The list of traditional retailers suffering from the e-commerce challenge has gained a new member, with domestic giant Wumart (HKEx: 1025) reporting its profit for 2013 fell for the first time in 5 years. It’s noteworthy to point out the last time Wumart’s profit fell was at the height of the global financial crisis in 2008, when the reasons for the downturn were sudden and severe but also relatively short-term. This time the reasons are much more gradual and signal a longer term decline for traditional retailers like Wumart, which are facing an unprecedented challenge from big e-commerce names like Alibaba, JD.com and Amazon China (Nasdaq: AMZN). Read Full Post…
Tag Archives: retail
Gap’s China Plan: Chasing the Middle End Gap锁定中国中产阶层
US retailer Gap (NYSE: GPS) is bringing its formula for selling cheap but trendy clothing to mainstream young Chinese, with a plan that looks like a smart way to tap the nation’s growing urban middle class despite its late arrival to the market. Executives from the US chain, an early pioneer in the trendy, affordable clothing business whose image has become a bit faded lately, detailed their China plans during a trip to the region late last week for the opening of their first Hong Kong store. (company announcement; English article) According to reports from the event, the company plans to have 15 stores in China by the end of its current fiscal year, and then to triple the number to 45 within a year of that. Frankly speaking, the company’s arrival to China is a bit late, as big foreign names like Japan’s Uniqlo (Tokyo: 9983), Hong Kong’s Esprit (HKEx: 330) and Sweden’s Hennes & Mauritz (Stockholm: HMb) have all operated in the market for several years now. But that said, all these foreign chains do quite well in China, and their stores are often packed on weekends with eager young urban shoppers eager to spend their hard-earned savings on the latest trendy but affordable clothes that these companies all offer. I see no reason why another big name like Gap can’t survive in this market, especially if it can find the right clothing mix and create a marketing campaign to establish itself as a trendy fashionable brand with strong overseas roots. Of course, that might be easier said than done, as Gap’s image in the US has faded quite a bit in recent years as the brand ages and younger, trendier chains like H&M take a bigger slice of the market. Still, if General Motors (NYSE: GM) can take a nameplate like Buick, considered a stodgy older brand in the US, and make it into a popular mainstream name in China, then there’s no reason why Gap can’t draw on its years of experience to do the same thing in China, potentially building the market into one of its top global contributors in the next 10 years.
Bottom line: Gap’s entry to China, despite its lateness, could stand a good chance of success, catering to young Chinese with limited funds but who still want to buy the latest trendy clothes.
Related postings 相关文章:
◙ Wal-Mart Buys Into China E-Commerce 沃尔玛进军中国电子商务
◙ Investors Feast on Sun Art 高鑫零售首日挂牌表现抢眼
◙ Welcome to the China Dollhouse: Barbie Packs Up Shanghai Camper
Wal-Mart Finds Bargain in China’s Internet Bubble
Yihaodian, the online merchant that made headlines earlier this year when it got an investment from global retail giant Wal-Mart (NYSE: WMT) (previous post) looks like the latest company to show signs of distress in China’s growing Internet bubble, following a report that gives it a surprisingly low valuation. According to the report, which cites an unnamed industry source, Wal-Mart, which bought an unspecified stake in the online retailer earlier this year, recently bought another 20 percent for a relatively modest $65 million. (English article) Some simple math will show this puts Yihaodian’s value at about $325 million if the report is correct. The same report cites Yihaodian’s chairman saying reports that Wal-Mart will take over the company are incorrect and that the size of the stake purchase is incorrect as well. But even if the numbers are slightly off, this market valuation for what is presumably an up-and-coming online retailer looks tiny compared to numbers being mentioned for other e-commerce firms, most notably an estimated $10 billion valuation given earlier this year by investors in 360Buy, China’s second biggest online merchant which is now hiring an investment bank for an IPO to raise up to $5 billion. (previous post) I realize that Yihaodian is much smaller than both 360Buy as well as leading online retailer Taobao Mall, owned by Alibaba Group. Still, this $325 million valuation looks like a real bargain for Wal-Mart, and no doubt represents an attempt by the worried seller of the stake, in this case Yihaodian’s controlling shareholder Ping An Insurance (HKEx: 2318; Shenzhen: 601318), to get back some of its investment before China’s Internet bubble bursts. As the Internet bubble swells and starts to pop, look for more of these sales at bargain prices as investors try to recoup some of their investments before it’s too late.
Bottom line: Wal-Mart’s purchase of 20 percent of online retailer Yihaodian for a bargain price will be followed by similar sales, as investors try to recoup their money before China’s Internet bubble bursts.
Related postings 相关文章:
◙ 360Buy $5 Bln IPO Plan Looks Like Desperation 京东商城50亿美元上市计划凸显绝望
◙ Wal-Mart Buys Into China E-Commerce 沃尔玛进军中国电子商务
◙ Gaopeng, Kaixin Spotlight China Internet Turmoil 高朋网、开心网凸显中国互联网混乱现状
Investors Feast on Sun Art 高鑫零售首日挂牌表现抢眼
After weeks of seeing one IPO scrapped after another as market sentiment toward China listings evaporated, especially in the Internet space, it’s nice to see there’s still healthy demand for a good, solid offer like hypermarket operator Sun Art Retail Group’s (HKEx: 6808) $1 billion IPO. After pricing at the top of their range, Sun Art’s Hong Kong listed shares soared as much as 43 percent on their first trading day, in one of the best debuts this year and in sharp contrast to the many flops for Chinese companies going public in Hong Kong and the United States. (English article) Sentiment has dropped so sharply that three companies, Internet firms Xunlei, Tudou and Shanda Cloudary, have all yanked their offerings in the last week due to terrible demand as investors fret over the quality of these firms’ accounting. (previous post) Such is clearly not the case for Sun Art, which operates in a much more straightforward business running supermarkets, which also has huge potential. As China’s mid-tier and smaller cities become wealthier, supermarket operators like Sun Art, whose stores carry the RT-Mart and Auchan names, should be able to go into these areas and easily attract consumers with their stores that offer more convenience and variety to traditional food stores that now dominate most of these towns. A growing number of suburban satellite cities of major metropolises like Shanghai and Beijing should also provide good fodder for growth. Already ranking first in the hypermarket sector, just ahead of Wal-Mart (NYSE: WMT), China Resources Enterprise (HKEx: 291) and Carrefour (Paris: CAR), Sun Art seems in prime position to capitalize on China’s growing hunger for mega-supermarkets.
Bottom line: Sun-Art looks like a strong bet for China’s fast-growing supermarket space, with plenty of room for upside for its newly listed shares.
随着市场对中国上市企业情绪转弱，数周来各公司纷纷取消IPO计划，尤其是在互联网领域。很高兴还能看到市场对像大卖场运营商高鑫零售有限公司<6808.HK>等好企业的股票需求强劲。高鑫零售IPO价格定在招股区间上限，规模为10亿美元。高鑫零售上市首日飙升43%。是今年上市首日表现最好的股票之一，与在香港和美国上市的其他中国企业股票的下跌形成鲜明对比。市场人气急转直下，以致迅雷、土豆和盛大文学三家企业均在上周搁置上市计划，因投资者担心各公司财务问题，认购情况不好。但高鑫零售很明显未受此影响。随着中国二线和较小城市日益富裕，高鑫零售等大卖场运营商应该能打入这些地区，并能轻易地吸引消费者。北京、上海等大城市周围日益增加的郊区卫星城市也将为其增长提供机遇。作为中国国内最大的大卖场运营商，高鑫零售似乎在中国超大型超市的发展中占得了先机。
一句话：在中国快速发展的超级市场行业，高鑫零售看似非常有潜力，其股票还有很大上升空间。
Related postings 相关文章:
◙ China’s Drive to the Suburbs: A Nice Supermarket Play 中国年轻人郊区购房 超市势将获益
◙ Wal-Mart Buys Into China E-Commerce 沃尔玛进军中国电子商务
◙ Belle, Baidu See Beauty in Online Shoe Store 百度和百丽投资优购网或为明智之举
Belle, Baidu See Beauty in Online Shoe Store 百度和百丽投资优购网或为明智之举
E-commerce in China is hot right now and apparel seems to be the latest hot area based on the latest deal involving online footwear seller Yougou. News on the investment is a bit conflicting, but consensus seems to be that Yougou has received hundreds of millions of US dollars in a new round of funding, and some are specifying the amount is around $450 million, with investors including Hong Kong-listed footwear distributor Belle International (HKEx: 1880) and Internet search leader Baidu (Nasdaq: BIDU). (English article; Chinese article) I haven’t been a big fan of Baidu’s e-commerce initiatives in the past, most notably its failed online store You’a, but this one certainly looks like it could have some potential with both a big Internet name behind it in the form of Baidu itself and a big apparel manufacturer and retailer in the form of Belle. This latest investment comes amid a recent flurry of activity in the e-commerce sector that points to its strong growth potential. Wal-Mart (NYSE: WMT) bought into online retailer Yihaodian in May (previous p
ost), and leading online apparel seller Vancl is reportedly in the process of an IPO that many believe will do well despite weak investor sentiment toward Chinese companies in general. Leading Web commerce company Alibaba also made headlines last month when it split its Taobao unit into three pieces, a move aimed at breaking out the more profitable online B2C store business from the more problematic online auction C2C site. (previous post) All these companies are clearly chasing a growing Chinese Internet market that now numbers more than 500 million users, many of whom like to shop online as such transactions become easier and provide more choice and quality guarantees to traditional brick-and-mortar stores. As the market develops, Yougou looks like it’s in a nice mainstream niche and should be an interesting company that, depending on its finances, could make an IPO in the next 2-3 years.
Bottom line: Online footwear seller Yougou looks like a smart investment for backers Baidu and Belle International, with potential for big growth and an IPO in the next 2-3 years.
电子商务目前在中国非常热门，鉴於鞋类销售网优购网日前获投资，服饰似乎是最新的一个热门领域。相关新闻说法略有些矛盾，但共识是，优购网在新一轮融资中筹到上亿美元，一些报导称，该融资具体金额约为4.5亿美元，投资者包括香港上市的鞋类销售商百丽国际<1880.HK>和网络搜索巨头百度<BIDU.O>。一直以来，我并不看好百度的各种电子商务举措，尤其是失败的百度有啊网站，但这次百度和百丽联手投资看似颇具潜力。电子商务领域近期各种动向均表明该领域极具增长潜力。沃尔玛<WMT.N>5月收购中国在线零售商1号店股权，有报导称凡客诚品正在准备首次公开募股（IPO），许多人认为，尽管对中国企业投资者情绪普遍偏弱，但凡客诚品IPO或会有良好表现。阿里巴巴集团上月将淘宝网分拆为三家独立公司，意在将盈利的B2C业务同问题重重的C2C业务分离。上述公司显然都加紧在中国互联网市场发展步伐，中国网络用户目前已突破5亿，许多人喜欢网上购物，因为交易更容易，选择更多，而且有质量保证。随着网购市场的发展，优购网看似发展方向不错，根据其财务状况，公司或会在未来两三年上市。
一句话：优购网增长潜力巨大，并有望在未来两三年上市，百度和百丽投资优购网似乎是明智之举。
Related postings 相关文章:
◙ Wal-Mart Buys Into China E-Commerce 沃尔玛进军中国电子商务
◙ Taobao Split: Separating Wheat From the Chaff 淘宝一分为三 如何取其精华
