Hong Kong Exchanges and Clearing Limited (HKEx) released earlier this week the findings from its Cash Market Transaction Survey for 2011/12, revealing the diversity among investors in its securities market.
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Last week saw a little noticed event in the cosy world of investment banking, with Russian (and emerging markets) firm Renaissance Capital calling it quits, and closing its offices in both Hong Kong and Beijing after only two years on the ground in Asia.
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Amid an 85% year-on-year decline in global IPO volumes, clean energy firm Huadian Fuxin is set to price an initial public offering of up to US$389 million equivalent (including a 15% over-allotment option) on June 20. As a concession to current volatility, the deal was cut from an original US$1 billion.
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A guest column I wrote for the China Economic Review.
2011 was a year marred by extreme volatility in markets, an earthquake and tsunami that disrupted global supply chains, renewed inflationary worries in Asia and, above all, the near collapse of the euro zone.
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HONG KONG (Dow Jones Investment Banker) – The Stock Exchange of Hong Kong’s growing effort to secure international listings speaks volumes about the possible threat posed by the Shanghai international board – when it eventually happens. Recent attempts, however, have been disappointing and HKEx should take stock of Kuala Lumpur’s (KL’s) Bursa Malaysia. Staying local has proved worthwhile.
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HONG KONG (Dow Jones Investment Banker) – Trigiant Group Ltd. has just filed a web proof information pack (WPIP) with the Stock Exchange of Hong Kong, the first step towards its proposed IPO. Little information has filtered about the structure of the deal, but a quick round up of ECM desks indicates that the mandate wasn’t competitive. Despite a limited trading history, the company has posted impressive growth rates and enjoys significant market share in an industry it dominates alongside two major competitors. At the same time, its reliance on a small number of clients and suppliers, and its high gearing, raise questions about the sustainability of its business model, as do some troubling past financial practices.
HONG KONG (Dow Jones Investment Banker) – The board of San Miguel Corp., the Filipino beer-to-infrastructure conglomerate, approved the reorganization of its power business and an increase in its share capital on August 12. After exploring several options, including a possible backdoor listing, San Miguel has settled for an IPO in Manila of up to US$500 million for its 75% subsidiary SMC Global Power Holdings. Macro factors, as well as current expansion plans for the business, look attractive, but San Miguel shareholders are unlikely to gain much through the value arbitrage.
HONG KONG (Dow Jones Investment Banker) – Singapore Exchange Ltd. (SGX) may have made headlines this year with the listing of one of Asia’s largest IPOs, Hutchison Port Holdings Trust, and, potentially, with the proposed flotation of Manchester United F.C., but Chinese mid-caps are increasingly leaving the shores of the Lion City to seek a quotation in Hong Kong. The reasons include, above all, greater liquidity, a wider following on the part of sell-side research analysts and, ultimately, a higher valuation.
