Consumer Products and Services

Alibaba drives home costs of Hong Kong unrest

21 August 2019READY SOON

The Chinese giant will delay a mooted $15 bln listing in the Asian hub after brewer AB InBev shelved its own. A trade war and protests are a poor backdrop for big offers. That will deter others and land a fresh blow to a city where business confidence is rapidly on the decline.

Meituan Dianping gets better at multitasking

21 August 2019

The $50 bln delivery-to-ride-hailing giant’s takeaway unit is expected to post its first profitable quarter on Friday, as it gets better at juggling multiple businesses. It has scaled down a costly bike sharing venture, while a push into groceries and maps plays to its strengths.

Smartphones may be as good as it gets for Xiaomi

20 August 2019

Revenue at the Chinese group's handset unit rose a tad despite shrinking demand for such devices. But a push into internet services has been disappointing: Boss Lei Jun is struggling to wring more money out of a growing user base. Xiaomi’s premium valuation looks too generous.

Twitter deserves a follow for China mute and block

20 August 2019

The $32 bln social network suspended state-backed accounts trying to subvert protests in Hong Kong. It also will stop taking ads from government-controlled media. Beijing’s wedge issue is a good opportunity for Facebook, YouTube and others to reconsider profiting from propaganda.

It is too soon to call a bottom on Baidu

20 August 2019

Despite a 62% decline in quarterly profit, the $36 bln Chinese internet company gave investors something to cheer with unexpected growth in video. Its main search business is hurting, though, and the ad outlook is weak. ByteDance and Meituan Dianping are coming for Baidu, too.

Walmart proves it’s a port in gathering storm

15 August 2019

Strong sales last quarter, especially in e-commerce, allowed the $300 bln giant to sail past growing headwinds battering retail rivals. It may even be able to withstand more Trump tariffs. And in a broader downturn, CEO Doug McMillon could pick up more price-conscious shoppers.

U.S.-China trade war hinges on farmers, not Apple

13 August 2019

The Trump administration is delaying import tariffs on some electronics, giving the iPhone maker and the S&P 500 a boost. That’s down to business lobbying and a little pragmatism. But the president wants to boost American agriculture. Until China helps, investors can’t rest easy.

Henkel struggles with consumer sector trade-off

13 August 2019

Today’s industry wisdom is that forgoing profitability to invest in brands can protect highly-prized top line growth. But the maker of Persil liquid is failing on both sales and margins. The market is right to be sceptical about the family company’s ability to turn things around.

Moutai investors channel their inner Carl Icahn

13 August 2019

Scrappy shareholders challenged the $180 bln Chinese distiller, echoing the U.S. activist’s tilts at titans such as Apple. State-backed Kweichow Moutai will sidestep a vote and cap related-party deals. There’s more work to be done, however, on Beijing-linked corporate governance.

Aramco stocks Reliance’s war chest for disruption

12 August 2019

Mukesh Ambani says the Saudi giant will buy 20% of his oil-to-chemicals unit at a healthy $75 bln valuation. The billionaire is adding cheap broadband to a revolutionary telecoms offering, and aims to reinvent Indian retail too. The Aramco sale hints at how far he'll go to win.

JD deserves to be in trade-war tech discount bin

9 August 2019

Chinese new-age stocks have turned volatile. Loss-making JD, the $40 bln Alibaba-rival, has lost up to one fifth its value since July. The retailer’s focus on sales of big-ticket items make it especially vulnerable to slowing growth and trade tensions. Rivals look more nimble.

J.C. Flowers’ Japan sale marks timely end of era

9 August 2019

The U.S. firm, once called a “vulture” by local press, is selling most of its stake in Shinsei Bank after 19 years. With Japanese lenders staggering, cashing out now of what has overall been a lucrative deal makes sense. Foreign funds owe Flowers for giving them a better name.

Hong Kong protests cloud Cathay Pacific’s skies

7 August 2019

The $5 bln airline delivered decent earnings and expects a better performance in the second part of the year. It won’t look so rosy, though, if anti-China clashes continue and prompt flyers to pick other hubs. Worse, Cathay’s ties to Air China are unlikely to provide shelter.

Kirin’s Japanese makeover is only half pretty

7 August 2019

The Japanese brewer is buying 30% of cosmetics and kale juice maker Fancl for $1.2 bln. Diversifying away from booze makes sense; rivals are doing it too. But paying a multiple of almost 40 times earnings, over twice the buyer’s own, for a minority stake is not a good look.

KKR gets a biscuit LBO do-over Down Under

2 August 2019

The private equity fund that invented the cookie buyout is acquiring Campbell's Australian snacks unit for $2.2 bln. It’s less audacious than the $25 bln RJR Nabisco deal 30 years ago. But if KKR can scrape out decent growth and profitability, this one may prove tastier.

Victor Li is a half mark up on Hong Kong’s tycoons

1 August 2019

Political unrest is a threat to top conglomerates with a big focus on the Fragrant Harbour. Earnings at Li’s CK Hutchison put a spotlight on the group’s shift away from the territory. Global growth is slowing and currencies are volatile, but a diversified bet still looks better.

Banking tests Jack Ma’s lemons-to-lemonade skills

1 August 2019

China makes life deliberately hard for online lenders like MYbank, backed by Alibaba's founder. The bank is now raising capital, but what it really needs are elusive deposits. Still, MYbank is growing and profitable, and Ma has experience at being the financial underdog.

Hadas: Gratuities reach an economic tipping point

31 July 2019

Customers like to reward good service. But food delivery service DoorDash’s now-abandoned policy of pocketing tips shows how generosity has become subservient to optimising profit. Fairer wages and clearer prices might work better.

EssilorLuxottica M&A invites sharp antitrust lens

31 July 2019

The $58 billion eyewear giant’s merger was waived through last year by regulators. But its purchase of Dutch optical retailer GrandVision risks curbing competition. It could promise to permit opticians to offer rivals’ products or sell some shops to a peer to help allay concerns.

Japan dims hopes of a Samsung memory chip rebound

31 July 2019

Shares of the $260 bln tech giant slid after the company warned of poor visibility into the impact of Tokyo's export curbs. South Korea’s escalating dispute with its neighbour threatens supply chains. It now throws into doubt Samsung's confidence that chip prices will recover.