Fintech

Tencent holds key to China’s e-sports bonanza

15 July 2019

DouYu, which lets fans live-stream top video gamers, wants to raise $1 bln in a New York IPO. Competition for star players has crushed margins. Investors will bet backer Tencent, which also owns a stake in a rival, can limit the destruction and push for consolidation.

Amazon could be a smart shopper in Southeast Asia

8 July 2019

The U.S. e-commerce giant pushed into Singapore in 2017, but hasn’t tackled the region's larger, faster-growing markets. Indonesia’s $7 bln Tokopedia and Alibaba-owned Lazada are among those scrapping for dominance. Amazon would be a formidable rival if it bought Sea's Shopee.

UK’s fallen fintech star highlights sector perils

2 July 2019

Funding Circle shares dropped 20% after it cut growth forecasts in half. The $600 mln peer-to-peer lender’s post-IPO decline underscores the trade-off between managing risk and meeting investors’ growth expectations. Regulators should be on the lookout for less prudent rivals.

Tech’s finance push is disrupting regulators too

25 June 2019

Innovations like Facebook’s proposed digital currency challenge established banking rules. New arrivals are hard to pin down, weaken existing players, and invert the risks and rewards of competition. A joined-up global response is necessary - but will be hard to agree.

Facebook throws down crypto-gauntlet to critics

18 June 2019

The social network’s poor track record on privacy makes it an unlikely creator of digital money. Yet it boasts 2.4 bln users and has enlisted some of the biggest names in tech and finance as partners. The new currency, Libra, is a bet that Facebook’s trust problems are overblown.

Sweden provides a cautionary digital tale for HSBC

18 June 2019

Hong Kong’s new online banking licences open the UK-based titan to new challenges in a market that accounts for 30% of pre-tax profit. Scandinavian giants such as Swedbank quickly fell prey to startups. And HSBC will be up against the likes of tech-savvy Alibaba and Tencent.

U.S.-PRC tensions upend tech funding supply chain

4 June 2019

American venture capitalists pumped a record $19 bln into Chinese startups in 2018 while flows the other way reached a high of $3.6 bln. Tougher foreign-investment rules and rising nationalism are set to add friction to capital movement, creating new winners and losers.

Payments bonanza has spoils even for latecomers

28 May 2019

Global Payments’ $22 bln merger with Total System Services is the sector’s third big deal this year. What it lacks in first-mover advantage it makes up for with sensible terms – the premium is less than FIS is giving Worldpay. Missing consolidation would have been a worse fate.

Dimming Huawei could help recharge Xiaomi phones

20 May 2019

The Chinese telecom group led by Ren Zhengfei may have lost access to Google's apps and services. This setback hits as $34 bln Xiaomi offset fewer total handset shipments last quarter by selling pricier models. It would further benefit from a weaker Huawei in Europe and beyond.

Tencent need not envy Jack Ma’s finance fame

20 May 2019

The $432 bln tech giant has offered investors a peek into its mobile money arm. It is accelerating into payments and wealth management, catching up with the Alibaba founder’s Ant Financial. Ma’s aggressive expansion rankled bank regulators. Tencent would be wise to stay low-key.

Finablr fire sale implies more than dicey markets

14 May 2019

The Travelex owner cut the price of its IPO by 17%, eating into proceeds for its billionaire owner. Had jumpy markets been the only issue, the float could have been delayed. A drastic price cut instead suggests wider investor quibbles with the currency and payments business.

Finablr struggles to ride payments IPO wave

10 May 2019

The Travelex owner is pursuing a London listing that will value it at a minimum of $1.9 bln. The foreign exchange and payments company’s valuation is lower than recent fintech floats. After a mixed bag of European offerings, however, investors may already have had their fill.

Wirecard $19 bln short trade belongs on the shelf

8 May 2019

The payments group made a natural target for investors betting on share price falls after the Financial Times questioned the integrity of its accounts. But now CEO Markus Braun has the backing of auditors and SoftBank, and has upped EBITDA guidance. Shorts face too many hurdles.

PayPal’s ride-share with Uber may be bumpy

26 April 2019

The $129 billion payments company could pick up some decent new business by investing $500 million in the ride-hailing firm’s IPO. But Uber is a riskier bet than other firms PayPal has taken stakes in. CEO Dan Schulman could be in for an uncomfortable journey.

SoftBank’s easy credit doesn’t extend to Wirecard

24 April 2019

The Japanese group is putting $1 bln into the under-fire fintech firm. Unlike some of SoftBank’s flightier deals, this will be done with convertible debt. Wirecard gets validation from a respected backer, which gets a disruptor on the cheap without taking upfront equity risk.

Payments duo hush European IPO bankers’ lament

10 April 2019

Nexi and Network International are selling shares worth $4 bln amid a dearth of new issues in 2019. The Italian and Middle Eastern groups have reliable revenues and high margins, drawing interest even from edgy investors. Network’s superior growth rate merits a higher multiple.

Volvo’s green car forecast flashes an amber light

29 March 2019

Boss Hakan Samuelsson says electric vehicles will be as lucrative as gas guzzlers by 2025. Taken at face value, that's optimistic, given Tesla, BYD and Nio struggle to break even. It's also a warning: making traditional engines ever cleaner and more efficient is driving up costs.

Huawei’s charm offensive scores only half-points

27 March 2019

The Chinese telecom champion is engaging in an unprecedented public relations push, battling U.S. allegations of spying, IP theft and opacity. Its arguments about security have some merit, but the campaign might convince more sceptics if Beijing wasn't trying so hard to help.

Wirecard’s relief surge has gone too far

26 March 2019

The 15 billion euro payment group’s shares rose more than a quarter after a review found no evidence of any misconduct that would have a material financial impact. Its valuation is now uncomfortably close to sector stalwarts Visa and Mastercard. A bigger discount is merited.

Tencent needs new obsession to replace video games

21 March 2019

The web giant’s fourth-quarter earnings slumped by nearly a third to $2 bln as Chinese curbs on mobile games took effect. Bets on payments and cloud computing have yet to pay off, and Tencent’s M&A record is patchy. Investors deserve a clearer idea of where it’s headed next.