Asia-Pacific

Breakdown: Narendra Modi’s not-so-bright spot

17 October 2017

The premier has called India’s sharp economic slowdown temporary but must be worried about a prolonged slump as state elections approach. Investors are more sanguine. Breakingviews explains how things went wrong, what is at stake, and why India might wait out the pain.

Guest view: Chinese oil can fuel North Korea talks

16 October 2017

Nothing will concentrate the minds of North Korean leaders more than a Chinese oil embargo. Nearly 90 percent of the country's petroleum comes across the border with China. Cutting off shipments would weaken the North's military capacity and help restart negotiations.

Blame for Deutsche Bank woe extends beyond CEO

16 October 2017

Reports of boardroom tension at the German bank are adding to unease among investors already rattled by a sliding share price. While boss John Cryan may be in the firing line, Chairman Paul Achleitner helped set the strategy. He shares some responsibility for the bank’s malaise.

Toshiba chips let Bain surf a Big Data wave

16 October 2017

A group led by Bain is paying $18 bln for Toshiba’s flash-memory unit after a drawn-out sale. The memory industry is cyclical and capital-intensive, and it's also in China’s strategic crosshairs. But a rising tide of demand for bytes will lift Bain's boat first.

Microfinance goes mainstream in India

16 October 2017

IndusInd, a bank, has agreed to buy Bharat Financial Inclusion in an all-share deal valuing the poster child of niche lending at $2.4 bln. The 11 pct premium is small but fair given concerns over the long-term sustainability of independent pure-play lenders to the poor.

TPG follows Turkish raki feat with Myanmar whisky

13 October 2017

The buyout firm has sold out of Myanmar’s largest spirits company in a $1 bln deal. As it did in Turkey, TPG again bought small, scaled up and sold to a big corporate buyer. Making deals in places like Yangon is an acquired taste – but can yield potent returns.

Communist Party assault muddles Chinese capitalism

12 October 2017

The government hopes to regain the private sector's confidence even as it tightens its grip, in particular on the critical tech sector. Alignment with state priorities could ease red tape, but bureaucrats make lousy CEOs, and vicious factional politics will distract executives.

Warning signs flash at Samsung after big quarter

13 October 2017

The tech group's top executive unexpectedly resigned following record-smashing forecasts for operating profit. An early lead in memory chips has fuelled blistering earnings growth at Samsung despite legal woes. But as rivals circle, a widening leadership vacuum looks worrying.

Fast Retailing tailors a bright future in Asia

13 October 2017

Full-year results from the $32 bln fashion retailer behind Uniqlo show it is back on track overseas. Fast Retailing is growing rapidly across Asia, has staunched U.S. losses, and has bold plans for China. After earlier missteps, this Japanese group is going global in fine style.

Sky investors choose between profit and principles

12 October 2017

Chairman James Murdoch faces a backlash over concerns about his independence as Twenty-First Century Fox, which he runs, tries to buy the UK pay-TV group. Shareholders have legitimate corporate-governance grievances. But financially they’d be better off with Murdoch’s money.

KKR sets a collision course with Elliott in Japan

12 October 2017

The buyout firm raised its bid for a Hitachi subsidiary, offering outside investors $1.3 bln. That price might not satisfy activist shareholder Elliott. KKR may need to sweeten the deal, within reason - its reputation in Tokyo for disciplined buying is worth preserving.

Beijing’s closer embrace is bad news for Big Tech

12 October 2017

China wants stakes and board seats at web giants like Tencent, the WSJ says. Beijing is already influential behind the scenes in technology, and given its tightening grip elsewhere, a power grab in this vital sector was all but inevitable. This will nonetheless cost investors.

UBS no longer lonely in Hong Kong’s IPO sin bin

12 October 2017

The securities watchdog says it is probing shoddy work by 15 firms on Hong Kong listings. That takes some heat off UBS, the only active IPO bank named so far. A lot has changed in recent years, but the regulator’s zeal in cleaning up the market is nonetheless welcome.

Hadas: Economists need more psychological abuse

11 October 2017

Insights from the study of the mind helped Richard Thaler win the Nobel Prize in economics. The dismal science would benefit from more thoughtful analysis. Rules of thumb could help with investments, statistics would become less alien, while ethics could illuminate big decisions.

Hong Kong’s new leader clears first hurdle

11 October 2017

In her maiden policy address, Carrie Lam unveiled lower taxes for small firms and more affordable housing for the middle class. Her proposals mark a decent start for tackling the city’s economic divide. If she follows through, Lam could earn support tackling more divisive issues.

Syngenta puts Beijing’s unspoken promises to test

10 October 2017

The Swiss seed company’s Chinese parent and its state backers disagree over whether they stand behind its legal bills. It’s a dynamic found across China’s financial system: implicit guarantees are common, and rarely tested. The government has good reason to keep things ambiguous.

Companies WACC central bankers on yields

10 October 2017

Rate-setters have engineered ultra-low borrowing costs and the risk premium on stocks is down. In theory, that lowers the bar for business investments. In practice, corporate hurdle rates have barely budged for decades. It’s a reality check for policymakers trying to fan growth.

IKEA digital surrender raises flicker of IPO hope

10 October 2017

The Swedish furniture firm has grown through its warren-like stores and without needing external capital. Yet it now plans to sell through websites like Amazon to reach new customers. With competitive pressures growing, IKEA might also revisit its aversion to selling stock.

Money-go-round is neat way to fix Indian banks

10 October 2017

New Delhi might issue "recapitalisation bonds" to stressed lenders and use the proceeds to bail them out, as it did in the 1990s. This makes sense: banks are flush with cash after Premier Narendra Modi banned big banknotes. It might also help to contain the fiscal deficit.

Breakdown: Xi and China’s leadership reshuffle

10 October 2017

President Xi Jinping may be China's strongest leader in decades, but reform has been slow on his watch. Some believe that if he can consolidate power at the Party Congress next week, he'll liberalise further. Four key benchmarks will help measure the strengthening of Xi's grip.