India’s "tax terrorism" proves hard habit to kick 13 Mar 2015 The government could honour a campaign pledge to make taxation more certain by scrapping a rule that allows it to seek payment for past transactions. That is politically fraught but may be less damaging than pursuing the likes of Britain’s Cairn Energy for old deals.
China’s art market paints itself into a corner 13 Mar 2015 The People’s Republic has become one of the world’s largest art hubs, with sales of $12 bln in 2014. Yet minimalist cross-border trade sketches a picture of an introverted giant: heavy duties and local tastes mean most of the action is staying firmly within China’s borders.
U.S. toll road investor dodges predecessors’ ditch 12 Mar 2015 Australia’s IFM will pay $5.7 bln for a bankrupt Indiana turnpike operator, 50 pct more than Macquarie and a Spanish partner shelled out in 2006. Less than half the amount is debt, though, and the road is in far better shape. That should help the firm steer clear of any potholes.
Asia’s Alibaba wannabes buy into wishful thinking 12 Mar 2015 A new generation of Asian e-commerce companies is inviting comparison with Jack Ma’s tech colossus. The analogy is useful but not always flattering. Like Alibaba these young companies benefit from fast-growing online markets - but are less likely to become true giants.
Twin ghosts haunt Malaysia’s sovereign fund 12 Mar 2015 The country created 1MDB to finance big national projects, but poor management has left it with net debt of more than $10 bln. Its links with the prime minister complicate the mess. Though the fund is now being restructured, the clean-up brings both financial and political risks.
Wobbly stock markets are in thrall to central banks 11 Mar 2015 Performance this year reflects likely monetary policy. The euro zone is set to ease: equities are strong and insiders are selling down stakes in Zalando, JCDecaux and others at a record clip. The U.S. market is weaker as tightening nears. Dollar-exposed Asian bourses struggle.
Japan retail deal gets M&A process back-to-front 11 Mar 2015 Convenience stores FamilyMart and UNY have set a date for their $5.4 bln tie-up, but haven’t agreed key terms. It’s another sign of the complexities of dealmaking in a country where big domestic mergers are rare. No wonder investors are worried the union will destroy value.
Strong dollar fails to crank up Asia export engine 11 Mar 2015 The greenback has risen almost 14 pct in trade-weighted terms since last June. Europe is using its currency advantage to win market share in America. Asia, however, is being less bold. Years of weak global trade have sapped the confidence of the region’s exporting powerhouses.
Credit Suisse buys some insurance with Pru CEO 10 Mar 2015 Hiring Tidjane Thiam to replace Brady Dougan should bring a fresh perspective to capital and cost conundrums. The former consultant may encounter skeptical dealmakers and regulators. Even so, his decision to leave the fast-growing UK insurer is a vote of confidence in banking.
Kaisa haircut is bad omen for China property debt 9 Mar 2015 The troubled developer’s proposed restructuring leaves creditors facing lower interest rates and delayed repayments. A shrinking cash pile and the sudden appearance of $5.6 bln of previously hidden debt should alarm all investors in the sector. Kaisa may not be an isolated case.
Weak yen brings little cheer to Japan’s economy 9 Mar 2015 Fourth-quarter growth was worse than previously estimated, and half of the expansion came from exports. Two years of weak yen have allowed manufacturers to cut prices to win market share abroad. But by not sharing their bonanza with workers, exporters are thwarting local demand.
China’s internet sector runs on harmonious enmity 9 Mar 2015 For Amazon to open a store on rival online retailer Alibaba’s website sounds like sleeping with the enemy. But competition in China’s e-commerce sector isn’t as fierce as it seems. The big internet companies have too little. Their customers meanwhile have too much.
Chinese FX intervention could be due a comeback 6 Mar 2015 For over a decade a weak yuan brought in export revenues. Then a rising currency attracted investment. The falling exchange rate helps the former but puts the latter in jeopardy. In order to avoid a financial crisis, stronger is probably better, even if it means more meddling.
Lenovo smartphone market grab risks backfiring 6 Mar 2015 The Chinese group is planning to launch a new mobile brand in China just months after completing its $2.9 bln Motorola takeover. Juggling separate brands may help fend off domestic upstarts like Xiaomi. But with margins already razor-thin, Lenovo is in danger of overstretching.
China’s lower growth target is missed opportunity 5 Mar 2015 Premier Li Keqiang says GDP will grow about 7 pct this year. Though the lack of precision helps, the goal may still force the government into short-term stimulus or fudging the numbers. For all its progress, China is still not ready to scrap its big, reassuring objective.
JD.com tries Alibaba’s route to e-commerce profit 5 Mar 2015 Transactions that match buyers with retailers on the Chinese group’s website grew 220 pct in the fourth quarter, far outstripping growth in direct sales. Acting as a middleman, like larger rival Alibaba, may offer better margins. Earnings are still absent, but look less elusive.
StanChart gives new CEO a mixed welcome present 4 Mar 2015 Departing chief Peter Sands has ruled out a share issue while promising stronger capital this year and higher returns in future. That suggests the emerging market bank’s position is less bleak than some fear. However, it also leaves successor Bill Winters with less wiggle room.
Alibaba’s split nationalities invite trouble 3 Mar 2015 Taiwan wants to boot the e-commerce group out for not declaring itself Chinese. Yet Alibaba’s home changes depending on who asks. China’s taxman sees Hong Kong, licensing bodies see China, and investors see the Cayman Islands. The confusion may encourage regulatory meddling.
HK property shows limits of new central bank tools 3 Mar 2015 Regulators in the former colony have spent five years tightening mortgage controls, but real estate prices are still rising. It’s a reminder not to expect too much from “macro-prudential” policies. Authorities can stop banks from lending too much. Deflating a bubble is trickier.
India’s $13bln spectrum auction has room for upset 3 Mar 2015 The top mobile operators are limbering up to renew licences that support as much as 70 pct of their revenues. The worry is that rivals or new entrants such as Reliance Jio may bid aggressively for additional bandwidth. An expensive auction will weigh on balance sheets.