Hong Kong

Li’s escape from Hong Kong value trap looks tough

16 Feb 2024

Richard Li has pulled his plans to float Asian insurer FWD many times, forcing his backers to wait for an exit. M&A may now be on the table. Nabbing a $10 bln valuation in a mooted stake sale to global peers like Sun Life will be tricky, even if the business is performing well.

Xi can wait out the Anywhere-But-China trade

8 Feb 2024

Removing the chair of the securities regulator offers a scalp for the market crash as domestic and foreign investors dump stocks and claw at other destinations. Confidence is flagging, but the Chinese leader's best option may be to let benchmarks find a bottom first.

Dismantling Evergrande exposes Hong Kong-China gap

29 Jan 2024

A court in the financial hub has ordered the world’s most indebted developer to liquidate after talks with offshore creditors collapsed. Yet how this will be enforced on the mainland, where most of Evergrande’s assets are, is unclear. The experience of HNA may offer some clues.

Hong Kong-China travel flip is a new headache

8 Jan 2024

It is one year since the border reopened and fewer mainlanders are arriving in the offshore hub. But Hong Kongers are increasingly travelling to Shenzhen and beyond to shop and eat. That’s a blow for the Asian centre's retail and property, and part of the shift looks permanent. 

Toyota will engineer a half-electric renaissance

27 Dec 2023

The world’s largest carmaker is playing catchup with electric upstarts like Tesla and China’s BYD, just as global demand for EVs slows. But boss Koji Sato will capitalise on the Japanese giant’s edge in hybrid vehicles as the tech enjoys a sudden renaissance.

The Li clan will deal their way out of value trap

20 Dec 2023

The Hong Kong-based empire founded by Li Ka-shing is unloved by investors. Despite his son Victor’s efforts to boost value, the $20 bln CK Hutchison trades at a big discount to its net assets. With 80% of revenue outside Greater China, it makes sense to explore a sale or breakup.

StanChart M&A theory will finally become reality

19 Dec 2023

For years, the bank run by Bill Winters was cheap but dysfunctional. Now, it’s producing significantly higher returns on tangible equity but the valuation remains low. If that persists in 2024, it will be hard for suitors like First Abu Dhabi Bank to resist launching a bid.

New Hong Kong bourse CEO picks up unfinished task

15 Dec 2023

Under Nicolas Aguzin, the $42 bln market operator failed to win big IPOs and the stock lagged its Singapore rival. His successor Bonnie Chan needs to diversify the business. She is starting from a low base in ropey markets and faces investor aversion to China. It’s a tough job.

Hong Kong’s property pain may soon get real

13 Dec 2023

The city’s leader John Lee is talking tough on illegal structures, a hot topic in the world’s most unaffordable housing market. Tackling the issue will frustrate the rich and may hit government revenues but it would please Beijing and the public. The necessity to act is growing.

Midea will test China Inc’s welcome overseas

7 Dec 2023

The world’s largest home appliance company plans to use proceeds from a Hong Kong listing to buy global brands. It follows the $48 bln firm’s 2017 purchase of Germany’s Kuka. Outbound M&A has shrunk but a weak Chinese economy provides a growing incentive to pursue deals abroad.

CATL prepares to power up wildest electric dreams

5 Dec 2023

The world’s largest battery maker boasts $14 bln in net cash, making a possible Hong Kong listing seem unnecessary. But the extra funds would help CATL grow in Europe and could potentially fuel explosive expansion in Southeast Asia and the US too.

For global banks, India could soon be worth it

7 Nov 2023

CEOs have descended on Hong Kong for a summit, but investment bankers based in the city are spending time elsewhere in Asia as revenue from China shrinks. In India, IPOs are on the rise and fees are improving. Buyout firms’ behaviour suggests those trends will continue.

HSBC’s profit resilience may face sterner tests

30 Oct 2023

Europe’s largest bank doubled third-quarter earnings and is buying back $3 bln of stock, despite a hit from Chinese real estate. Yet the benefit of higher rates is wearing off while costs are stubbornly rising. CEO Noel Quinn’s targets leave room for bigger setbacks.

StanChart hopes crash into harsh market realities

26 Oct 2023

Shares in the lender run by Bill Winters tanked by up to 17% after surprise hits to its China bank and real estate holdings. These may be one-offs. But the reaction is a reminder that StanChart’s current mediocre goals, after years of subpar results, offer little room for error.

Hong Kong property stares into the abyss

24 Oct 2023

Secondary sales prices in the world’s least affordable housing market fell 19% since a 2021 peak, the biggest slump since the global financial crisis. High interest rates are a pain and slashing stamp duties may not help. The city’s image problem will keep hurting sentiment.

China’s consumers look more golden closer to home

9 Oct 2023

Domestic tourists splurged $103 bln over Golden Week, marking the busiest holiday in five years. Yet fewer consumers are venturing further afield, including to Hong Kong, while those who do spend less. That’s a smaller problem for Beijing than it is for the rest of the world.

Spying suspicions will stalk Alibaba and Wall St

6 Oct 2023

Belgium is scrutinising the tech giant’s European logistics hub as its courier unit prepares to list. The issues may be old but the risks facing Chinese firms going global are rising. Elections in the US and beyond will only make China deals harder to execute.

Alibaba spinoff can deliver two recovery packages

4 Oct 2023

Logistics unit Cainiao’s name may mean “rookie”, but the group is profitable and weaning itself off dependence on its parent. A successful IPO valuing it at $10 bln or more would warm up Hong Kong’s market and show Alibaba’s overhaul is on track after CEO Daniel Zhang’s exit.

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.