Hong Kong

Hong Kong bankers play an anxious waiting game

26 Sep 2023

Fewer IPOs in the city mean firms such as UBS and Bank of America are more willing to handle middling transactions like Tuhu’s $150 mln offer. But as big deals stir in New York and beyond, the downsizing increasingly will look like an awkward stopgap for Wall Street.

Nomura is merely first in line for new China risk

25 Sep 2023

Charles Wang Zhonghe, the firm’s Hong Kong-based chair of investment banking for the People’s Republic, is barred from leaving the mainland. Overseas banks committing to bulk up in the country may no longer be able to avoid the effects of President Xi Jinping’s crackdowns.

Samsonite’s baggage is heavy with geopolitics

12 Sep 2023

Of all the global companies listed in Hong Kong mulling full or partial exits from the city, the $5 bln luggage maker has the least financial motive to move but is “evaluating” venues nonetheless. It hints at the growing pressure on multinationals to plan for extreme scenarios.

Richard Li can afford to be fifth time lucky

11 Sep 2023

The tycoon’s Asian insurer FWD looks set to let its Hong Kong listing application lapse. Ending its fourth IPO push is sensible: it doesn’t urgently need funds. Yet Li’s multi-year run at a debut for his sober business is turning into a test for the languishing capital market.

Revamped Pru faces up to an old problem

31 Aug 2023

CEO Anil Wadhwani boosted the insurer’s new business profit by a third in the first half and laid out new growth targets. But despite shedding its UK and US arms to focus on Asia, the $35 bln group’s valuation still lags rival AIA. A slowdown in China makes it harder to catch up.

Global insurers surf China’s storm while they can

24 Aug 2023

AIA’s value of new business in Hong Kong more than doubled in the first half. The $100 bln giant and peers are benefitting again from selling policies to returns-hungry mainland visitors. Insurers may become victims of their success if Beijing’s angst over capital flight deepens.

A less friendly Hong Kong awaits global investors

15 Aug 2023

The city ditched a requirement for Chinese firms to hold separate votes on certain matters for onshore and offshore shareholders. It hits at the outsize influence BlackRock and others long exercised via Hong Kong and is another reason to buy mainland shares instead.

L’Occitane buyout is bad look for Hong Kong

10 Aug 2023

Boss Reinold Geiger wants full ownership of his skincare group. At $7 bln, it would be the city’s largest take-private and L’Occitane could relist at a higher valuation at home in Europe. It’s a no-brainer others will want to copy and shows up the Asian hub’s helplessness.

Bubble tea will test limits of China’s consumers

8 Aug 2023

Half a dozen boba-drink makers including Mixue Bingcheng are looking to list abroad. Profit margins are low in the $20 bln sector. But as shoppers reduce higher-end spending, the cheap-and-cheerful brews can thrive – even if Beijing holds back on much-needed stimulus.

HSBC invites shy investors to turnaround party

1 Aug 2023

Boss Noel Quinn is upping targets at the $160 bln bank after first-half pre-tax profit more than doubled. It’s good timing: pushy shareholder Ping An and its breakup hopes may have been effectively silenced, but other owners need convincing that Quinn’s overhaul has legs.

Swire’s Coca-Cola sale gives investors sugar rush

29 Jun 2023

Handing its US drinks subsidiary to its parent for $3.9 bln allows the Hong Kong conglomerate to pay a tasty dividend, cut net debt and still run the division for a fee. It’s a sweet deal for investors, as long as property, airline Cathay Pacific and other holdings recover soon.

Hong Kong’s market promotions get shrill

28 Jun 2023

The city’s bourse is trying to lure foreign listings from Europe and the Middle East while regulators push local lenders to bank crypto exchanges. The first initiative is worthwhile but unlikely to yield much new business; the latter creates fresh headaches for HSBC and peers.

Hong Kong’s yuan-trading push is a long-term bet

19 Jun 2023

The city’s bourse operator will allow investors to trade some stocks in yuan. The hope is to eventually lure more mainland Chinese and offshore investors. But as with the near decade-old trading link with China, any tangible financial benefits will take a while to flow through.

Vodafone’s do-or-die UK deal is a risky bet

14 Jun 2023

The $24 bln telecoms firm is merging its UK mobile business with CK Hutchison’s Three to create Britain’s largest network. It is promising investment to win over competition watchdogs. It could backfire, but CEO Margherita Della Valle has few easy ways to please weary investors.

Yacht maker’s Italy pivot shows the way for Prada

8 Jun 2023

A year after its Hong Kong IPO, the Chinese-owned maker of boats loved by Hollywood stars is rushing to also list shares in Milan. The move offers scant valuation upside, but hedges geopolitical risks. If Ferretti can pull it off, luxury brand Prada will follow.

Wall Street faces life in China’s second tier

1 Jun 2023

Morgan Stanley, Goldman Sachs and rivals are trimming jobs in Greater China due to a slow recovery and US tensions. Even when activity picks up, boosting market share in the world’s second-largest economy will be tough. The usually dominant financiers will remain fringe players.

Geely’s Aston Martin stunt could backfire

19 May 2023

The Chinese auto giant is doubling its stake in the storied carmaker to 17%, and snagging a board seat. But the 45% premium looks rich. Aston Martin needs to speed electrification and sales in China, but Geely will struggle to squeeze value from a stalling British business.

Chinese tourists return with lighter wallets

3 May 2023

More than 240 mln people are visiting mainly domestic spots like Shanghai and Hong Kong during the Labour Day festivities. It’s slightly more than pre-Covid levels, but spending is lower as many find cheaper ways to have fun. That bodes ill for an already weak retail revival.

Hong Kong bourse’s profit pop looks passive

27 Apr 2023

Earnings popped 28% last quarter, but mostly thanks to the exchange operator’s investments gains; its core business of listings and trading was lacklustre. Boss Nicolas Aguzin can only hope IPOs and transactions revive in case returns from HKEX’s own trades aren’t sustained.

Hong Kong’s dollar stress gets more fundamental

24 Apr 2023

The peg against the greenback is under mounting pressure; officials have run down reserves to a 15-year low defending it and they can keep going. But only part of the currency weakness is speculative. The trend highlights worries about the Asian hub’s long-term economic future.