It’s one thing when analysts say China’s banking sector is facing a massive bad loan crises, but quite another when someone from the industry admits there is a problem, which is what has finally happened with new remarks from Bank of China’s (HKEx: 3988; Shanghai: 601988) chairman. Analysts have been warning of this problem for more than a year now, and a regulator even added his voice to the concerns last month (previous post), after China’s top banks went on a lending binge in 2009 and 2010 as part of Beijing’s 4 trillion yuan economic stimulus package.
Journalist China
Tencent Ties Up With Activision 腾讯牵手动视暴雪
Leading Internet firm Tencent (HKEx: 700) is solidifying its place as China’s top online game company, following the announcement that it has entered into a long-term strategic alliance with US-based Activision Blizzard (Nasdaq: ATVI), a leading global game developer. (company announcement) This new tie-up is interesting for a number of reasons, marking not only the latest in a recent string of strategic moves for Tencent but also for its implications for Activision’s hugely popular World of Warcraft game, which it currently licenses to rival online game operator NetEase (Nasdaq: NTES).
Qihoo Under New Assault 奇虎再遭做空机构阻击
How many short sellers does it take to kill a strange tiger, or the company more commonly known as Internet software security specialist Qihoo 360 (NYSE: QIHU)? The question itself may sound strange, but Qihoo, whose Chinese name means “strange tiger,” is once again in the spotlight after its data has been questioned once again by yet another short seller. This marks the third time such a report has come out since late last year, reflecting the wide degree of skepticism that many feel towards this company and its controversial leader.
News Digest: July 4, 2012 报摘： 2012年7月4日
The following press releases and media reports about Chinese companies were carried on July 4. To view a full article or story, click on the link next to the headline.
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◙ Everbright Bank Said to Plan $1.8 Billion Share Sale (English article)
◙ Qihoo 360 (NYSE: QIHU) Rejects Allegations From Known Short Supporter (PRNewswire)
◙ Activision Blizzard (Nasdaq: ATVI), Tencent (HKEx: 700) In Long-Term Partnership (Press release)
◙ Sohu’s (Nasdaq: SOHU) Sogou Seeks New Investment After Alibaba Sale (Chinese article)
◙ China Mobile’s (HKEx: 941) Anhui Unit Allows Users to Move Cities, Keep Number (English article)
Apple iPad Settlement: A Victory for China iPad商标纠纷获和解 对苹果和中国是双赢
After months of haggling, Apple (Nasdaq: AAPL) has finally settled a high-profile trademark dispute with a bankrupt Chinese company over use of the iPad name, paving the way for the US tech giant to continue an aggressive ramp-up in a market that has become its second largest worldwide. News of this settlement looks good for not only Apple but also China, allowing the former to reclaim rights to the iPad name while showing companies that Beijing is committed to creating a business friendly environment for those who play by the rules.
More Trouble Signs in Youku, Tudou Union 优酷与土豆联姻问题重重
New signs are emerging of trouble brewing in the pending marriage of China’s top 2 online video sites, with leading site Youku (NYSE: YOKU) announcing some new top executive changes that completely ignore top managers from its future partner Tudou (Nasdaq: TUDO). I previously predicted this kind of discord could quickly snowball after Youku and Tudou announced their unlikely marriage last year, due to very different leadership styles of their 2 heads, along with indications that neither leader was prepared to leave the merged company.
Dangdang Links With Tencent 当当网和腾讯联手
China’s overheated e-commerce wars are quickly becoming a game of musical chairs that has seen many top names form partnerships with other big players, including an interesting new tie-up between top-tier operator Dangdang (NYSE: DANG) and leading Internet company Tencent (HKEx: 700). This new tie-up looks quite interesting and significant, though I should also point out that it’s just the latest in a steady string of recent initiatives for Dangdang, which has also just announced the launch of a more dubious move targeting the wedding market.
China Accelerates Telecoms Opening 中国加速电信业开放
After years of protectionism that effectively locked out private investment from the sensitive telecoms sector, Beijing finally looks ready to open up the space with its release of a draft plan detailing new areas for private investors. This latest development follows signs earlier this year that the telecoms regulator was preparing to open up the sector, which many greeted with skepticism due to Beijing’s previous empty pledges to open the industry when it entered the World Trade Organization back in 2001.
New Stumbles from BYD, Sina, Qunar 比亚迪、新浪及去哪儿遭遇新问题
Chinese companies are feeling the summertime heat of a slowing home economy, with new reports emerging from an array of sectors reflecting turbulence at troubled car maker BYD (HKEx: 1211; Shenzhen: 002594), and also at a year-old struggling luxury goods channel operated by leading web portal Sina (Nasdaq: SINA). Neither of these reports is too surprising for reasons I’ll soon explain; but perhaps a bit most worrisome are other reports saying up-and-coming online travel services site operator Qunar has also laid off some employees, in a sign that China’s economic slowdown is starting to affect even healthier companies.
Xiaomi’s Mega-Funding: Investor Exit Near
The news keeps coming thick and fast for Xiaomi, arguably China’s hottest company right now in the overheated tech space, which has just raised a tidy $216 millon in funding as its low-cost, high-performance smartphones become the latest must-have item in China’s mobile market. That kind of new funding for young high-tech companies hasn’t been seen in China for nearly a year now due to concerns about an Internet bubble, making this capital injection all the more impressive for a company like Xiaomi which only launched its first product last fall. The big size of the funding leads me to suspect that Xiaomi’s investors are aiming to boost not only the company’s manufacturing capacity and profile, but also its valuation in the run-up to either an IPO or perhaps a sale of the company as early as by the end of this year.
Solar: Trina Dumps Deloitte, LDK Shares Tank 光伏行业：天合光能解除与德勤审计关系 赛维LDK股价大跌
New developments from Trina Solar (NYSE: TSL) and LDK Solar (NYSE: LDK) reflect the financial turmoil gripping the struggling solar sector, boding poorly not only for these 2 major players but also for the China arm of Deloitte, the controversial auditor that has just been dumped by Trina. The developments are all part of a bigger picture that has seen the solar sector gripped by its worst-ever downturn for more than a year now, sending all manufacturers into the red and possibly pressuring some to resort to creative accounting to mask the gravity of their situations.
