Chasing $13 bln Nexon throws Tencent off its game 25 Jan 2019 The Chinese titan behind “League of Legends” is eying control of its rival, which makes “Counter-Strike.” Tencent probably could help Nexon move faster from PCs to mobile. But slower industry growth and a Beijing crackdown suggest boss Pony Ma would be wiser to focus elsewhere.
Big Brother startups offer white knuckle returns 24 Jan 2019 Facial recognition startups SenseTime and Megvii are in fundraising mode. Video surveillance in China is tipped to be a $20 bln industry by 2022. Sticky questions could result in volatile valuations, but Beijing’s resolve to watch its citizens closely will drive growth.
Evergrande’s desperation to drive could find road 24 Jan 2019 The Chinese conglomerate’s health unit is making another quirky bet on electric vehicles as the property market at its core stalls. Yet a $900 mln move for NEVS might make more sense than earlier purchases if Evergrande can use it to help startups overcome production problems.
Trump risks Pyrrhic victory in China trade war 23 Jan 2019 Market woes could push the U.S. president to accept superficial concessions such as Beijing buying more American goods without cutting subsidies or stopping tech transfers. Yet the damage inflicted by his tariff fights on everything from farmers to supply chains could be lasting.
Burberry’s hopes rest on new designer’s magic 23 Jan 2019 The British fashion house eked out 1 pct growth in same-store sales last quarter, worse than luxury rivals. A looming hard Brexit could also be a massive headache. The weak results mean the group badly needs 44-year-old Riccardo Tisci’s debut collection to be a hit.
Toyota JV recharges Panasonic’s battery business 23 Jan 2019 The two Japanese companies are uniting to power electric vehicles. It should provide a technological step forward for the $200 bln automaker, but also reduce Panasonic’s dependence on Elon Musk’s Tesla. Toyota’s control, though, may yet limit plans to sell to other manufacturers.
Super-apps hold back Chinese movie-ticketing IPO 22 Jan 2019 Maoyan may wind up going public below its latest $3 bln valuation. Slowing box office growth and cooling tech stocks are two problems. A bigger issue is that investors can already buy shares in backers Meituan and Tencent, whose all-in-one apps have a stronger lock on users.
Fewer Chinese babies intensify an old story 22 Jan 2019 The country’s birth rate fell below 11 for every 1,000 people, its lowest level since the People’s Republic started in 1949. It’s a reminder that the country’s working-age population will keep shrinking, and makes redesigning a weak pension system a far more pressing matter.
Bold Chinese stimulus will have to wait 21 Jan 2019 GDP grew 6.4 pct in the fourth quarter, down from 6.5 pct in Q3. The economy is cooling faster than Beijing wants, but not fast enough to warrant the aggressive monetary and fiscal steps some bureaucrats, and many investors, would like. For now, expect more talk than action.
TPG takes fresh stab at China buyout quandary 21 Jan 2019 After a long dry spell on the mainland, the private equity firm co-led by Jim Coulter will now work with CICC to pursue deals. Overseas funds have struggled to find targets, but also generate better returns than local rivals. It makes a partnership model worth testing in China.
Fortnite outplays media titans in a battle royale 18 Jan 2019 The video game may have raked in as much as $2.4 bln in sales last year, more than any 2018 Hollywood blockbuster. Now Netflix says it is threatened too. Success comes from mass appeal: both young and old gamers are hooked. Streaming giants and movie outfits are right to be alarmed.
Viewsroom: China’s slowdown is not created equal 17 Jan 2019 People in the Middle Kingdom are buying fewer iPhones and cars, but Nike and others are chugging away nicely. Meanwhile, India’s struggling rural farmers are a force too big to ignore in this year’s general election. Plus: The Detroit auto show reflects the industry’s gloom.
China can give stock buying idea a wide berth 15 Jan 2019 Beijing’s financiers are abuzz with debate about whether the central bank should buy equities as part of official efforts to help a slowing economy. Drawbacks would outweigh limited benefits. Luckily there is a better way to channel money to where it would do growth more good.
AB InBev’s Asia sale needs breathalyser test 14 Jan 2019 The Belgian brewer is said to be mulling an IPO of its Asian unit. The region is a fast-growing jewel in the drinks giant’s crown, yet it faces stiff competition in China, and still struggles in India and Southeast Asia. The mooted $70 bln valuation will be tough to keep down.
Chinese mystery beauty queen is ripe for makeover 11 Jan 2019 Pechoin is giving global cosmetics brands a run for their money in China’s $30 bln skincare market. Its revival from state-owned obscurity is impressive; it did so without outside investors or partners. As the economy cools, however, it could make an attractive acquisition target.
Beijing U-turn hints at silly season for subsidies 9 Jan 2019 The state planner is hinting at measures to increase domestic consumer spending on cars and appliances. Any tax cuts or handouts would be a short-term fix that shifts focus away from efforts to cut excess capacity. It underscores China’s determination to prop up the economy.
HNA’s haphazard selloff keeps getting trickier 9 Jan 2019 The Chinese conglomerate is flogging stakes in an online lender, life insurer and brokerage. A lack of clear strategy and market perceptions of creditor clout will make it harder to profitably unwind HNA’s $50 bln buying spree. Falling asset prices aren’t helping, either.
Citi plays longer game in China 9 Jan 2019 Even as the mainland economy wobbles, the U.S. mega-bank is ditching a Shanghai underwriting and advisory JV to build a brokerage it can control. A more pliant partner would help Citi compete against entrenched Chinese rivals. Slumping markets should make finding one easier.
iPhones are unreliable Chinese shopping indicators 4 Jan 2019 Apple’s warning about China iPhone sales has freaked out markets. Yet foreign luxury brands – such as thousand dollar smartphones - make shallow indicators of broader trends. Chinese demand is indeed cooling, but unevenly. Investors need not panic just yet.
Airbnb will succeed where U.S. peers failed: China 4 Jan 2019 Unlike Google or Facebook, the home-sharing app’s model dovetails with Beijing’s view that property be used for living, not speculating; and its rating system helps with social credit scoring. Domestic rivalry will be fierce, but Airbnb’s global network gives it one advantage.