The following press releases and media reports about Chinese companies were carried on October 31. To view a full article or story, click on the link next to the headline.
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- China’s Big Banks Set For Slowest Annual Profit Growth Since Going Public (English article)
- Air China (HKEx: 753), GA Telesis in Aircraft Leasing, Spare Parts JV (Businesswire)
- ICBC (HKEx: 1398) Announces Q3 Results (HKEx announcement)
- Dangdang (NYSE: DANG) Opens Store on TMall (Chinese article)
- Baidu’s (Nasdaq: BIDU) Qunar Aims for US IPO By Year End (Chinese article)
- Latest calendar for Q3 earnings reports (Earnings calendar)
A number of interesting tidbits are sifting through the online world today, including news from the e-commerce space that Jingdong Mall is entering the electronic payments space and that Dangdang (NYSE: DANG) has replaced its CFO. Meantime, online search leader Baidu (Nasdaq: BIDU) has reported its latest results that show its growth continues to slow, with the rapid rate of the slowdown slightly alarming.
A couple of major overseas moves are in the headlines today, spotlighting the fact that Chinese firms are becoming increasingly adept at relatively simple resource deals, even as they still lack sophistication to do M&A in other, more complex sectors. In the former category, oil major PetroChina (HKEx: 857; Shanghai: 601857; NYSE: PTR) has reached a deal to co-develop a $3 billion oil pipeline in Canada with a local partner, in the largest project of its kind by a Chinese firm to date. In the latter, a white-knight rescue bid by a relatively obscure Chinese firm for bankrupt plane maker Hawker Beechcraft has collapsed, leaving the US company no choice but to work out a reorganization plan with its creditors.
Domestic auto giant SAIC (Shanghai: 600104) may be the king of China’s car market, but it clearly has a sensitive stomach for overseas activity as reflected by its recent decision to largely abandon its wobbly India joint venture with longtime partner General Motors (NYSE: GM). I have to admit that I’m a bit mixed on my feelings about this latest news, which has seen Shanghai-based SAIC sell most of its stake in the 50-50 India venture back to GM just 3 years after the venture’s formation.
The long awaited clean-up of China’s cluttered group buying sector appears to be accelerating, with new reports that a potential cash-rich consolidator has emerged in the form of GroupNet, which is itself the product of the merger earlier this year between former mid-sized players FTuan and Gaopeng. The new reports say that GroupNet has raised $40 million in new funds, which it will use to acquire other companies in the money-losing space where many players are now on life-support after burning through hundreds of millions of dollars in investor dollars over the last 2 years. (
The year 2012 will easily go down as the worst for New York IPOs by Chinese firms since the global financial crisis, though there’s still some hope we could see one or 2 offerings in the next couple of months by cash-starved Chinese firms. A social media website named YY surprised many when it made a preliminary New York IPO filing earlier this month (
The headlines are buzzing with news bits from each of the country’s 3 major telcos, with high-speed services taking big steps forward even as US telecoms equipment powerhouse Cisco (Nasdaq: CSCO) could be bracing for a Chinese winter. In the former group of headlines, media are reporting that China Mobile (HKEx: 941; NYSE: CHL) has made a significant step into 4G with plans to expand its trial TD-LTE network into China’s interior, while China Telecom (HKEx: 728; NYSE CHA) has just won an important new license to offer TV and other video and data services over its fixed-line broadband network. Meantime, China Unicom (HKEx: 762; NYSE: CHU) is also making headlines with reports that the company is replacing Cisco-supplied equipment from some of its key network due to security concerns.
China’s biggest brokerage CITIC Securities (HKEx: 6030; Shanghai: 600030) could be a company to watch over the next 2-3 years as it attempts to become the country’s first truly global player using its newly acquired CLSA unit as a stepping stone. If I were making bets, I would say the company has the resources it needs to become one of the top second-tier global players in the next 4 or 5 years, competing successfully with the likes of names like Japan’s Nomura and Britain’s Barclays Capital. If it can do that, I would even give the company a chance of eventually entering the echelons of a global elite that includes names like Morgan Stanley (NYSE: MS) and Goldman Sachs (NYSE: GS), though that will take at least a decade or possibly longer.
When ZTE (HKEx: 763; Shenzhen: 000063) warned 2 weeks ago that it would post a massive third-quarter loss, everyone assumed that its smartphone business was partly to blame as the company sacrificed margins in exchange for fast growth. Now it seems that even its smartphone plans were overly ambitious, with ZTE’s newly released official results showing it is likely to miss its smartphone target for the year by a big gap. Meantime, Lenovo (HKEx: 992), still basking in the glory of recently becoming the world’s biggest PC seller, is also making its own smartphone moves with news that it will start to sell its models outside China. I’ll admit I have my doubts about this new smartphone push by Lenovo, as the company has enjoyed far less success with this product in its home China market than with its core PC business.
