Alibaba’s cracks show by revisiting Hong Kong 28 May 2019 The $400 bln e-commerce company plans to raise up to $20 bln from a second listing, five years after its New York IPO. Investors closer to home may give Alibaba a richer valuation. But seeking fresh capital alongside younger rivals also suggests its dominance is under threat.
Corporate clout on the line in Hong Kong fight 22 May 2019 From Washington to Wan Chai, executives are loudly protesting the city’s plan to allow extradition to mainland China. The business community often gets its way in the financial hub. Losing in this standoff would signify a turning point in Hong Kong for more reasons than one.
HSBC’s rich valuation reflects spare buyback ammo 3 May 2019 The emerging market lender’s pre-tax profit jumped a tenth in the first quarter, buoyed by a lending boom in Asia. Investors are assuming the bank will hit its 11 percent return-on-equity target in 2020. Surplus capital of $2.6 bln gives boss John Flint extra room for manoeuvre.
Hong Kong currency peg seduces yet again 29 Apr 2019 Hedge fund manager Kyle Bass is the latest investor to lay out a dire case about a long-time link to the U.S. dollar. His rambling argument suggests overleveraged banks and political ructions make the peg precarious. It probably will require a real crisis to prompt any overhaul.
Asian logistics IPO delivers at a discount 11 Apr 2019 Warburg Pincus plans a Hong Kong listing for $4 bln warehouse operator ESR. Fancy godowns are in short supply and e-commerce is booming. Yet public markets have not favoured regional rivals like GLP, taken private in 2017. Plain packaging will help the sale stack up.
Obsolescent Hong Kong lenders get a virtual kick 2 Apr 2019 City regulators have awarded three online-only banking licenses, hoping to shake up a lucrative $23 bln local market after years of underinvestment. Tough requirements mean two have gone to ventures backed by big names, not startups. That won't stop them tackling HSBC and others.
Cathay’s budget-airline deal may add HNA surcharge 28 Mar 2019 Buying Hong Kong Express from the ailing Chinese conglomerate for $630 mln is a sensible defensive move. One investor – maybe the target’s own chairman – has threatened to fight the sale, however. That could raise the price for Cathay, and is a warning to suitors for HNA assets.
The Exchange: Fomenting rugby fever in Hong Kong 26 Mar 2019 As the city braces for the annual Sevens showdown, organiser Robbie McRobbie tells Breakingviews what the event reveals about its host. From fancy dress and fancier corporate suites, to a real estate dilemma, the sports extravaganza tracks the financial hub’s health and wealth.
Cleaning up Hong Kong’s small caps is dirty work 22 Mar 2019 Scandals and high fees doom over 1,000 companies listed in the city to low valuations and feeble trade. The exchange may cut transaction costs to boost turnover, but that won’t solve deeper issues. Delisting would be a better solution for many, even if the process will be grimy.
Hong Kong fumbles its China extradition fix 21 Mar 2019 The city may exclude white-collar crimes from a mooted deal to exchange suspects with the mainland, to assuage the business community’s concerns. Unfortunately, such an awkward compromise would only confirm the tension between the financial hub’s needs and Beijing’s ambitions.
Chinese stock xenophobia is a problem for MSCI 11 Mar 2019 After expanding the weight of A-shares in its benchmarks, the index provider had to drop a popular tech stock thanks to policies capping foreign shareholdings. If it happens too often, MSCI indexes will be less representative of demand. It’s a bad look for China’s market opening.
Review: Gig-economy firms tread precarious path 8 Mar 2019 The likes of Uber tapped casualised labour to become global giants. They have created a “precariat” class of workers, open to exploitation and abuse. Colin Crouch’s “Will the Gig Economy Prevail?” offers a manifesto for a benign alternative, but underplays technological shifts.
Hong Kong bank showcases the XX factor 8 Mar 2019 As International Women’s Day brings more sad stats about corporate diversity, $46 bln Hang Seng Bank can stand proud. Its shares have outperformed under three consecutive female CEOs and a cohort of female directors. It sets a powerful example for companies worldwide to follow.
Stricken Hanergy drops investors into black hole 1 Mar 2019 The solar company wants shareholders to swap frozen shares for stock in a vehicle which may or may not relist in China. Hanergy might well be ejected from the Hong Kong exchange before trading resumes, denying them an alternative. This raw deal would set a terrible precedent.
Hong Kong exchange primed for some M&A trades 28 Feb 2019 The $43 bln bourse operator enjoyed a blowout 2018, but its three-year strategic plan offers few bold ideas for reducing dependence on local equities. Looming Chinese reforms pose a further threat. A trio of new blue-chip advisers may be able to help HKEX diversify its portfolio.
StanChart makeover gets scarcely halfway there 26 Feb 2019 The Asia-focused bank kept expenses under control and curbed bad debts, but socking away $900 mln for fines restrained profit growth. CEO Bill Winters promises more cuts and to double return on equity to 10 pct by 2021. Even then, StanChart would seriously lag Singapore peer DBS.
Only next crash will test HK bank chief’s legacy 22 Feb 2019 Norman Chan, head of the Hong Kong Monetary Authority, plans to retire. Supervision was a bigger focus than traditional monetary policy during his decade in office, using controls such as mortgage curbs to limit a housing boom. Only a downturn will determine whether that worked.
Lenovo’s reboot could run low on battery 21 Feb 2019 Quarterly pre-tax earnings more than doubled from a year earlier, confirming a turnaround at the world's top PC-maker. That's mostly powered by cost cuts in the $9 bln group's handset and server units. With demand cooling for both, this comeback may prove difficult to sustain.
HSBC pushes investor goodwill to its limits 19 Feb 2019 The Asia-focused bank fell short of expectations after a fourth-quarter slowdown. Even so, boss John Flint is sticking to his 11 pct return on equity target for 2020 despite strong Brexit and China headwinds. Already valued at 1.2 times book value, there is no room for error.
China’s big urban-zone idea lacks finer points 19 Feb 2019 Beijing unveiled a blueprint to link Hong Kong, Macau and mainland cities into a $1.5 trln economic powerhouse. The Greater Bay Area plan is packed with industrial-planning jargon. What’s missing is nitty-gritty on taxes, consumer banking and commuting, which will matter most.