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News Digest: November 20 报摘： 2012年11月20日

By newsdoug on November 19, 2012

The following press releases and media reports about Chinese companies were carried on November 20. To view a full article or story, click on the link next to the headline.
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HSBC (HKEx: 5) In Talks To Sell $9.3 Bln China Ping An (HKEx: 2318) Stake (English article)

Jingdong Mall Launches Online Music Service (English article)

MIIT to Release Plan for Trial Private Investment in Telecom Sector (English article)

Qihoo 360 (NYSE: QIHU) Reports Q3 Unaudited Results (PRNewswire)

Total (Paris: TOTF) Sells $2.5 Bln Nigeria Oil Field Stake to Sinopec (HKEx: 386) (English article)

Citi Heats Up China Credit Cards 花旗将引爆中国信用卡市场

By newsdoug on September 20, 2012

Citibank launches China credit cards China’s credit card market could be heading for a major explosion soon, following the official entry of the first foreign card issuer to the market in the form of global banking giant Citibank (NYSE: C). Foreign media have given relatively little coverage to this event, but in my view the development is quite significant for reasons that I’ll explain shortly that could ultimately lead to the kind of consumer credit bust that previously wreaked havoc on the banking sectors in Taiwan and South Korea.

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China Welcomes More 2nd-Tier Financiers 中国欢迎更多二级金融机构

By newsdoug on September 11, 2012

CIT doubles China lending program What I like to call the “second wave” of overseas financial institutions coming to China is picking up momentum, with announcements of new expansions in the market by relatively unknown players CIT Group (NYSE: CIT) and MoneyGram (NYSE: MGI). I’ll discuss what each of these companies does shortly, as neither enjoys the widespread recognition of much bigger names like Citigroup (NYSE: C) and HSBC (HKEx: 5; London: HSBA) that have been active in China for more than a decade now despite making only limited inroads during that time.

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Solar Shares: De-listings Ahead? 太阳能股票：未来会退市？

By newsdoug on May 27, 2012

Shares of solar panel makers took a beating last week, as brokerages downgraded a few amid flare-ups in the trade war between the US and China for an industry already suffering through its worst-ever downturn that has pushed most companies into the red. But while the war of words continues between Washington and Beijing, an even more interesting and potentially devastating low-key war is going on with the solar companies’ shares, which could soon face the very really threat of de-listing from the New York and Nasdaq stock exchanges. JA Solar (Nasdaq: JASO) crossed a quiet but critical threshold on May 18, when its shares closed below the critical $1 mark for the first time, ending that day at 89 cents. Since then they have gone 6 consecutive trading days without rising back above the $1 mark, closing last Friday at 92 cents. Stock market followers will know that rules dictate that US listed companies must maintain their share prices above $1 as a rule to remain listed on the big boards, and that trading below that mark for more than 30 days is grounds for potential delisting. JA Solar, whose market capitalization now stands at $186 million, is the first major player to fall below the $1 mark, but others could soon follow. Suntech (NYSE: STP), which calls itself the market leader even though its market cap is smaller than several of its rivals, saw its shares tumble 8 percent to $1.78 on Friday, near an all-time low, after HSBC reduced its price target for the company. (English article) HSBC cut its Suntech price target to $1 from a previous $1.27, and 13 of the 18 analysts who have updated their ratings on the company since last week now recommend a “sell”. Others who are hovering dangerously close to the de-listing range include Renesola (NYSE: SOL), now trading at $1.33, and Yingli (NYSE: YGE), whose shares now trade at $2.62. It’s unclear what would happen to JA Solar or any of the others if their shares really did trade below $1 for 30 days, as they could technically do a reverse stock split to bring their shares back above the $1 mark. But perhaps more importantly, falling below the psychologically critical $1 mark may finally be the wake-up call that many of these companies need to tell them they should seriously consider merging with some of their rivals to consolidate the crowded sector, or risk being de-listed or worse.

Bottom line: Several of China’s struggling solar shares are in danger de-listing, which could finally push some to consider mergers with rivals to save themselves.

CITIC Securities, Koreans Challenge Western Giants 中信证券和韩国电视台挑战西方企业

By newsdoug on December 28, 2011

CITIC Securities, Koreans challenge Westerns in growth areas Two separate news bits out today show that Asian firms, in this case leading brokerage CITIC Securities (HKEx: 6030; Shanghai: 600030) and 3 Korean TV program makers, may pose an interesting challenge to Western names in lucrative developing new business areas in now taking shape in China. In the first of those bits, CITIC Securities announced it has just received regulatory approval to become a renminbi qualified foreign institutional investor (RQFII), a new program that allows financial services firms to raise Chinese yuan outside the country for re-investment in China stocks and other financial products. (company announcement) RQFII specifically targets a growing number of foreigners who want to invest in the yuan offshore as China moves to internationalize its currency, also known as the renminbi. To date, this offshore yuan business, mostly centered in Hong Kong, has been dominated by big foreign names like HSBC (HKEx: 5; London: HSBA), so it’s interesting to see a big Chinese name like CITIC Securities getting involved so quickly in the new RQFII scheme. Of course CITIC Securities will now have to convince foreign investors that it can get them better returns for their yuan than big foreign names that are also applying for RQFII status. But given its market-leading position in China and strong knowledge of Chinese markets, I would expect to see CITIC Securities become a top-tier player in this new and potentially lucrative area in the next 1-2 years. In the second news bit, PPLive, an IPO candidate and one of China’s top video sharing websites, has signed an exclusive deal to license all TV dramas from 3 Korean TV networks for the next 3 years. (English article) No financial details were given and I’ll admit I don’t know anything about the 3 Korean networks in this deal; but the amount of programming does look massive, involving 12,000 episodes of various TV series with 13,500 hours of programming. This deal is interesting in the light of a recent series of high-profile licensing deals between other video sharing sites like Youku (NYSE: YOKU) and Tudou (Nasdaq: TUDO) with major Hollywood studios, and shows that other Asian program makers, whose shows are popular among many Chinese, will also be competing to cash in on demand from these content-hungry Chinese video sites. Look for more such blockbuster deals from other Asian markets like Japan, Taiwan and Hong Kong in the months ahead.

Bottom line: New deals involving CITIC Securities in the offshore yuan business and Koreans in video licensing show Asian firms will win growing business in areas traditionally dominated by Westerners.