Author Archive
Apr
(The author is a Reuters Breakingviews columnist. The opinions expressed are her own)
By Wei Gu
HONG KONG, April 29 (Reuters Breakingviews) - Li Ka-Shing didn't become Hong Kong's richest man by leaving money on the table. Hui Xian, a real estate trust backed by the tycoon, dropped 10 percent on its trading debut on April 29. As the first-ever offshore listing in Chinese yuan, that sets a bad precedent. It is especially bad news for underwriters HSBC Holdings Plc , and Bank of China Ltd , whose hot new investment idea now looks like a flop.
Hui Xian didn't have great timing. Another initial public offering, Pangda Automobile Trade Co Ltd , plunged 23 percent on its Shanghai debut the previous day. Hong Kong's Hang Seng Index has lost 2 percent since Hui Xian's price was set on April 20. Meanwhile, the Chinese currency has been on an appreciation spurt. Increased volatility may have damped the fad for all things yuan.
A bigger factor is price. Li and his banks priced the stock aggressively, betting on hot demand. Although Hui Xian was issued at the bottom of the indicated price range, its forecast 2011 yield of 4.3 percent was still the lowest in the market. Yet it carries big liquidity risk, since the pool of offshore yuan is limited. Only 10 percent of shares changed hands on the first day, much less than similar issues.
The flop will affect sentiment for future yuan stocks in Hong Kong. But it will also cost the two major underwriters, who have styled themselves as leaders for offshore yuan products. Bank of China is the designated clearing bank for Chinese currency in Hong Kong. HSBC proclaims its Chinese roots and global reach as big advantages in capturing offshore yuan business. This poor showing won't help them one bit.
Context News
--Hong Kong's first yuan-denominated initial public offering, Hui Xian Real Estate Investment Trust tumbled 10 percent on April 29. Hui Xian, which owns the Oriental Plaza complex in Beijing, priced its offering at the low end of the indicated price range, which equates to a dividend yield of 4.3 percent.
--Link REIT is forecast to yield 4.5 percent in 2011, Regal REIT 4.8 percent, GZI REIT 6.9 percent, Prosperity REIT 5.8 percent and Fortune REIT 6.5 percent, according to estimates by UBS.
--Chinese car dealer Pangda Automobile Trade Co Ltd fell 23 percent in its Shanghai debut on April 28. For a related news piece: RELATED COLUMNS How and Y Yuan IPOs -- For previous columns by the author, Reuters customers can click on (Editing by John Foley and Chris Lewis)
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Apr
TEC PLC PRELIM
19/May 09:00 I S SOLUTIONS PLC AGM
19/May INVENSYS PLC PRELIM
19/May MARSTON S PLC H1
19/May NATIONAL GRID PLC PRELIM
19/May 08:15 NATIONAL GRID PLC CONFCALL
19/May 08:00 NEXT PLC AGM
19/May 10:00 OFFICE2OFFICE PLC AGM
19/May PREMIER OIL PLC TRADING
19/May 11:00 PETROPAVLOVSK PLC AGM
19/May 10:00 PRUDENTIAL PLC AGM
19/May SABMILLER PLC FINAL
19/May 09:00 SUMMIT CORP PLC AGM
19/May 09:30 TOTAL PRODUCE PLC AGM
19/May TALKTALK TELECOM GROUP PLC TRADING
19/May 10:30 TT ELECTRONICS PLC AGM
19/May 08:30 THE UNITE GROUP PLC AGM
19/May THE VITEC GROUP PLC TRADING
19/May 09:30 THE VITEC GROUP PLC AGM
19/May 10:00 ZAMANO PLC EGM
----- ---- --------------------------- ---------- ----------
20/May 10:00 ALLIANCE TRUST PLC AGM
20/May 15:00 CONCURRENT TECHNOLOGIES PLC AGM
20/May 10:00 DERWENT LONDON PLC AGM
20/May 11:00 ENERGETIX GROUP PLC AGM
20/May FUTURE PLC H1
20/May 12:00 INTERTEK GROUP PLC AGM
20/May JOHN MENZIES PLC TRADING
20/May 11:15 JOHN MENZIES PLC AGM
20/May 11:00 MICHAEL PAGE INTERNATIONAL PLC AGM
20/May 10:00 PREMIER OIL PLC AGM
20/May SCOTTISH AND SOUTHERN ENERGY PLC PRELIM
20/May 09:00 TRIBAL GROUP PLC AGM
----- ---- --------------------------- ---------- ----------
23/May 08:30 AG BARR PLC AGM
23/May BRITISH LAND CO PUBLIC LTD COMPANY(FINAL
23/May 11:00 DUNEDIN INCOME GROWTH INVESTMENT TRAGM
23/May FFASTFILL PLC PRELIM
23/May 11:30 MARTIN CURRIE PORTFOLIO INV TRUST AGM
23/May MITIE GROUP PLC PRELIM
23/May 13:00 PANMURE GORDON AND CO PLC AGM
23/May 10:00 RSA INSURANCE GROUP PLC AGM
23/May RYANAIR HOLDINGS PLC CONFCALL
23/May RYANAIR HOLDINGS PLC FINAL
23/May 10:00 READYMIX PLC AGM
23/May VECTURA GROUP PLC PRELIM
----- ---- --------------------------- ---------- ----------
24/May 08:00 ANT PLC AGM
24/May BIG YELLOW GROUP PLC PRELIM
24/May 09:00 CORERO PLC AGM
24/May CABLE AND WIRELESS WORLDWIDE PLC FINAL
24/May DE LA RUE PLC PRELIM
24/May ENDACE LTD PRELIM
24/May ENDACE LTD ANALYST
24/May 10:00 FAIRPOINT GROUP PLC AGM
24/May GREENCORE GROUP PUBLIC LTD CO H1
24/May GREAT PORTLAND ESTATES P L C PRELIM
24/May HOLIDAYBREAK PLC H1
24/May HOMESERVE PLC PRELIM
24/May MARKS AND SPENCER GROUP PLC PRELIM
24/May 08:30 NYRSTAR SOCIETE ANONYME EGM (Second Ca
24/May PARAGON GROUP OF COMPANIES PLC H1
24/May PENNON GROUP PLC PRELIM
24/May STRATEGIC THOUGHT GROUP PLC PRELIM
24/May TOROTRAK PLC PRELIM
24/May VICTREX PLC H1
24/May 08:00 ZENERGY POWER PLC AGM
----- ---- --------------------------- ---------- ----------
25/May ALLIANCE TRUST PLC INVESTOR
25/May AURELIAN OIL & GAS PLC AGM
25/May 13:00 AVIS EUROPE PLC AGM
25/May AVEVA GROUP PLC PRELIM
25/May BTG PLC PRELIM
25/May 11:00 CHARLES TAYLOR CONSULTING PLC AGM
* 25/May 06:00 CALEDONIA INVESTMENTS PLC PRELIM
25/May CABLE AND WIRELESS COMMUNICATIONS PFINAL
25/May 08:30 CABLE AND WIRELESS COMMUNICATIONS PANALYST
25/May DRS DATA & RESEARCH SERVICES PLC TRADING
25/May 14:00 DRS DATA & RESEARCH SERVICES PLC AGM
25/May 13:00 ENQUEST PLC AGM
25/May 10:00 EDINBURGH US TRACKER TRUST PLC AGM
25/May 08:00 G4S PLC CONFCALL
25/May 11:00 HILTON FOOD GROUP PLC AGM
25/May 14:30 KINGFISHER PLC INVESTOR
25/May 13:30 LEGAL AND GENERAL GROUP PLC AGM
25/May 09:00 LOOKERS PLC AGM
25/May QUINTAIN ESTATES AND DEVELOPMENT PLPRELIM
25/May ROBERT WALTERS PLC AGM
25/May SPORTINGBET PLC Q3
25/May TELECOM PLUS PLC PRELIM
* 25/May THE INNOVATION GROUP PLC H1
----- ---- --------------------------- ---------- ----------
26/May 09:00 ALLIANCE PHARMA PLC AGM
26/May BURBERRY GROUP PLC PRELIM
26/May 06:00 DAILY MAIL AND GENERAL TRUST P L C H1 (DMGOa.L)
* 26/May 09:00 ELAN CORP PLC AGM
26/May MAN GROUP PLC PRELIM
26/May F&C CAPITAL AND INC INV TRUST PLC H1
26/May HELICAL BAR PLC PRELIM
26/May 11:00 HYDRO INTERNATIONAL PLC AGM
26/May 14:00 INVISTA REAL EST.INV MNGT HLDGS PLCAGM
26/May 09:30 ING UK REAL ESTATE INCOME TRUST LTDAGM
26/May KCOM GROUP PLC PRELIM
26/May 09:30 LOMBARD MEDICAL TECHNOLOGIES PLC S/HOLDERS
26/May PROSTRAKAN GROUP PLC AGM
26/May 13:00 PV CRYSTALOX SOLAR PLC AGM
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Apr
BUCHAREST, April 29 |
BUCHAREST, April 29 (Reuters) - Here are news stories, press reports and events to watch which may affect Romanian financial markets on Friday.
GOVERNMENT MEETING
The centrist coalition government holds meeting where it is expected to approve the country's updated euro convergence programme.
BANCA TRANSILVANIA
Romania's second-largest listed bank Banca Transilvania BATR.BX releases Q1 financial results.
ROMANIA SEEN KEEPING RATES FLAT IN MAY/JUNE
The central bank is seen holding rates at 6.25 percent in May, maintaining its neutral stance of the past year, as inflation might not yet have peaked given that food and fuel price pressure is set to remain strong in coming months.
[ID:nLDE73R0MS]
BCR
Romania's largest bank, BCR, owned by Austria's Erste Bank (ERST.VI), recorded a net profit of 76.1 million lei ($27.70 million) in the first quarter of this year.
Ziarul Financiar, Page 1
BANCA TRANSILVANIA
Shareholders of Romania's Banca Transilvania approved plans to increase capital by 296 million lei to 1.77 billion.
Ziarul Financiar, Page 3
TRANSELECTRICA
Romanian state-owned power grid operator Transelectrica TSEL.BX will have a new head as of May 11, as the economy ministry decided to replace Stelian Gal, sources say.
Adevarul, Page 20
NOTE- For a diary of forthcoming Romanian events, double click [RO/DIARY], and a calendar of east European economic indicators, see [CONV/DIARY].
For other related news, double click on: --------------------------------------------------------------- Romania Market Debt [RO-DBT] Romanian forex [RO-FRX] Romania Market Report [ROL/] Romanian money [RO-M] Emerging Market Debt [EMRG/DBT] Emerging forex [EMRG/FRX] All Emerging Markets news [EMRG] CEE indicators [CONV/DIARY] All East Europe News [EEU] E.Europe equities [.CEE] TOP NEWS -- Emerging markets [TOP/EMRG] TOP NEWS -- Convergence watch [TOP/EAST] Romanian indicators [RO/ECI] Main page of Reuters poll <RO/POLL1> ---------------------------------------------------------------
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Apr
* Cbank expected to raise rates by at least 25 bps on Tuesday
* Sensex down 0.2 pct; to post second weekly fall in three
* State Bank, HDFC Bank, Steel Authority drop
* ICICI Bank, ITC gain (Updates to mid-morning)
MUMBAI, April 29 (Reuters) - Indian shares slipped on Friday and were on course to drop for the second week in three as investors braced for a hawkish statement from the central bank when it releases policy on Tuesday.
Financials led the decline with the market expecting the Reserve Bank of India (RBI) to raise key short-term rates by at least 25 basis points. It would be the ninth increase since mid-March last year to rein in high inflation.
HSBC said a worsening inflation outlook strengthens the case for continued monetary tightening by the central bank, and it may lift rates by 50 basis points on Tuesday. [ID:nL3E7FT0JV]
"We are holding up our hopes that they will deliver a more decisive move to avoid falling too far behind the curve and help better anchor inflation expectations," HSBC economists Leif Lybecker Eskesen and Prithviraj Srinivas wrote in a note.
Analysts polled by Reuters this week showed they expect a total of 75 basis points increase in rates for the rest of 2011, up by 25 bps from a forecast in March. [ID:nL3E7FQ0YW]
Top lender State Bank of India and HDFC Bank were down 0.7 percent and 1.1 percent respectively.
ICICI Bank extended gains and rose 0.2 percent after it reported on Thursday its strongest quarterly profit growth in at least seven years and signalled further improvement in asset quality. [ID:nL3E7FS1X6]
At 10:55 a.m. (0525 GMT), the 30-share BSE index was down 0.24 percent at 19,245.93 points with 12 components declining.
It is down 1.7 percent for the week and nearly 1 percent lower in April.
Data from the market regulator showed, foreign institutional investors (FIIs) were sellers for the first three trading sessions this week.
"FIIs are just booking profits. I don't see this as a withdrawal from Indian stocks," Deven Choksey, managing director and CEO of KR Choksey Shares. "People are also hesitant before the RBI policy next week."
Foreign funds, who had been net sellers in January and February, have bought a total of $3.2 billion over the past eight weeks.
The 50-share NSE index was down 0.2 percent at 5,773.90. Losers outpaced gainers in the ratio of 1.3 to 1in the broader market, with 244 million shares traded on the NSE.
Cigarettes-to-hotels group ITC was up 0.8 percent on demand optimism based on India's robust consumption story.
Steel Authority of India was down 1.3 percent ahead of its March quarter earnings.
The MSCI's measure of Asian markets other than Japan was down 0.8 percent, while Japanese markets were closed for a public holiday.
STOCKS ON THE MOVE
* Crompton Greaves tumbled 11.6 percent to 248.15 rupees after the power equipment maker reported late on Thursday a 6 percent decline in March quarter profit. [ID:nBMB012762]
Credit Suisse said in a note a sharp fall in margins was a concern.
* Manappuram General Finance & Leasing was up 4.2 percent at 137.15 rupees after the non-banking lender said its fiscal year 2011 net profit more-than-doubled and the firm's board approved a one-for-one bonus issue of shares. [ID:nWNAS1959]
MAIN TOP THREE BY VOLUME ON NSE
* Alok Industries on 11.5 million shares
* Unitech on 9.7 million shares
* Crompton Greaves on 6.2 million shares
FACTORS TO WATCH * For technical analysis see: www.reuterstechnicals.com * Indian rupee report * Indian bonds report * Punch-drunk dollar struggles to get off the canvas * Crude falls on fears slower U.S. growth may cut demand * Ailing dollar boosts demand for commodities, credit
* Dow transports hit record, lifting Wall St * For closing rates of Indian ADRs (Reporting by Ami Shah; Editing by Ranjit Gangadharan) (If you have a query or comment on this story, send an email to newsfeedback.asia@thomsonreuters.com)
ASIA-PACIFIC STOCK MARKETS: Pan-Asia........ Japan....... S.Korea.. S.E. Asia....... Hong Kong... Taiwan... Australia/NZ.... India....... China....
OTHER MARKETS: Wall Street .... Gold ....... Currency. Eurostocks..... Oil ........ JP bonds.. ADR Report ..... LME metals. US bonds.. Stocks News US.. Stocks News Europe
DIARIES & DATA: Indian Data Watch [ID:nINDATA] Asia earnings diary U.S. earnings diary European diary Indian diary Wall Street Week Ahead Eurostocks Week Ahead
TOP NEWS: For top Asian company news, double click on: U.S. company news European company news Forex news Global Economy news Technology news Telecoms news Media news Banking news Politics/General news Asia Macro data A multimedia version of Reuters Top News is available at: topnews.session.rservices.com
LIVE PRICES & DATA: World Stocks <0#.INDEX> Currency rates Dow Jones/NASDAQ Nikkei FTSE 100 Debt <0#USBMK=> Indian rupee LME price overview
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Apr
WARSAW, April 29 |
WARSAW, April 29 (Reuters) - Polish lender BRE Bank BREP.WA doubled its net profit in the first quarter of the year, beating forecasts thanks to improving business conditions that boosted revenue and reduced bad loans.
BRE, a unit of Germany's Commerzbank (CBKG.DE), said on Friday its net profit reached 230 million zlotys ($86.6 million) compared to 220 million expected by analysts in a Reuters poll. In the same period of 2010 it earned 115 million zlotys. (Reporting by Chris Borowski)
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Apr
MUMBAI, April 29 |
MUMBAI, April 29 (Reuters) - Indian shares edged up 0.1 percent in choppy trade early on Friday after declining for four days.
At 9:17 a.m. (0347 GMT), the 30-share BSE index was up 0.09 percent at 19,309.44 points with 17 components advancing.
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SINGAPORE/HONG KONG, April 29 |
SINGAPORE/HONG KONG, April 29 (Reuters) - Kohlberg Kravis Roberts & Co is in talks to buy Singapore-listed abalone farmer Oceanus Group Ltd in a deal that may be worth around $500 million, three sources with direct knowledge of the matter told Reuters.
Private equity firm KKR has lined up financing of $300-400 million from a group of banks, according to one of the sources.
KKR and Oceanus declined to comment. (Reporting by Charmian Kok and Stephen Aldred; Editing by Denny Thomas and Muralikumar Anantharaman)
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Apr
MUMBAI, April 29 |
MUMBAI, April 29 (Reuters) - Billionaire Mukesh Ambani-controlled Reliance group is in talks to buy the stake held by Bharti Enterprises in an Indian insurer joint venture with AXA Group , the Economic Times reported on Friday.
The discussions with Bharti have not yet reached a conclusion, the newspaper quoted people familiar with the matter as saying.
Reliance group, which controls energy major Reliance Industries , is keen to enter insurance and has been approached by two to three companies but is yet to finalise a partner, the paper said, quoting a senior executive familiar with Reliance' financial sector plans.
A Reliance spokesman said the company does not comment on market speculation. Bharti could not immediately be reached by Reuters for a comment.
Bharti AXA is a joint venture between Bharti Enterprises, which controls leading Indian telecoms firm Bharti Airtel , and AXA, Europe's second biggest insurer.
Last month, Reliance Industries said it agreed to set up a joint venture with D.E. Shaw Group to build a financial services company. [ID:nSGE72R00J] (Writing by Neha Singh; Editing by Ranjit Gangadharan)
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Apr
* H2 profit A$553 mln vs A$541 mln expected by analysts
* Signals worst may be over
* Dividend 100 cents
* Says expects higher 2012 earnings, subject to market conditions
* Securities business profit contribution falls 70 pct on year (Adds fund manager quote, details)
SYDNEY, April 29 (Reuters) - Macquarie Group , Australia's largest investment bank, said on Friday the worst may be behind it for its volatile trading and investment banking businesses despite reporting its fourth half-year profit fall in five.
Macquarie said its equity trading driven securities business, which saw its profit contribution fall 70 percent to a five year low of A$175 million, will perform better this year than in 2011 as will its marquee investment bank.
"They seem to have weathered the worst. Whether the recovery is more hockey stick kinds or flattish is now a function of investment markets," said Paul Biddle at Celeste Funds Management.
"I wouldn't yet ring the bell and say they have hit the bottom. The results say if you are investor you sit but it still doesn't spur one to go and buy," added the fund manager.
The challenge for Macquarie Chief Executive Moore is to lift return on equity which is at a 10-year low by reallocating capital to productive business and fend off calls for job cuts as some investors feel the bank bulked up prematurely.
The other divisions of lending, asset finance, funds and fixed income and commodities would be up or broadly-in line with 2011, it said. Thomson Reuters I/B/E/S estimates a net profit of A$1.25 billion in 2012, versus A$956 million in 2011.
Macquarie's earnings announcement follows sharp earnings declines for bigger global rivals such as Goldman Sachs and Morgan Stanley which were also roiled by falling trading revenue. [ID:nN21242223]
MOMENTUM PICKING UP
Macquarie, emerging from the worst downturn in its trading history, said net profit in the second half fell 3.2 percent to A$553 million. That was slightly ahead of expectations as market conditions improved, and Macquarie said business momentum was picking up and could lead to a better result this year.
That compared with a Thomson Reuters I/B/E/S estimate of A$541 million.
Macquarie, which used to be called the "Millionaire's Factory" for its generous banker pay, said subdued equity market conditions were showing signs of improvement and deal pipeline in its investment bank was promising.
"The pipeline is definitely better than this time last year. We have signed more mandates than last year," Chief Financial Officer Greg Ward told reporters.
Its investment bank, which has for years topped the Australian investment bank league tables, is slipping as top deal makers retire or quit in an indication that lower-than expected bonuses are irking bankers.
Thomson Reuters data shows it stands at No.4 in the Australia M&A league table so far in 2011, down one spot. In Asia it is in 10th position, five notches below where it ended 2010.
Macquarie, seeking to transition from a managed listed funds model to a traditional investment bank, warned in February that its full-year profit may miss market expectations. It said the risk appetite of clients was improving though there was quite a long way to go before normalcy returned.
Amid volatile markets, Macquarie has remained focused on building its fixed income, currencies and commodities business globally as well as the fund management and corporate asset businesses that span equipment to aircraft leasing.
But with slipping profits, the group is also facing calls to trim its workforce to ensure top talent gets better pay. The group said it had 15,556 employees at the end of March, up from 12,716 two years ago.
The firm, which runs an employee profit-sharing plan that pays more as earnings rise, risks falling well behind main rivals on pay, hurting its capacity to compete, Nomura said in a recent report.
Macquarie pays bankers an average of A$300,000 ($327,825) a year, or about 40 percent lower than global rivals, the Nomura report said, adding the it would need to cut less efficient staff to retain key talent.
Macquarie said employment expenses rose a quarter during the year. While it expected to maintain the employee compensation ratio, it said there would be significant changes to employee count in the year leading to a tighter rein on costs.
Macquarie shares, which have seen only four annual falls in the past 14 years, are down 5.7 percent so far this year compared to a 2.7 percent rise for the broader index . ($1 = 0.915 Australian Dollars) (Editing by Ed Davies)
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Apr
* Says Q1 unique users grew 19 pct, not 29 pct
* Raises questions about its numbers ahead of planned IPO
NEW YORK, April 28 (Reuters) - In the run-up to one of the hottest social media IPOs of the year, China's Renren Inc lowered the number of users it said it gained in the first quarter of 2011, raising questions about the rest of the information it provided to investors in official filings.
According to the revised filing on April 27, the Chinese Facebook clone's monthly unique log-in user base grew by only 5 million, or 19 percent, in the first quarter of 2011 -- not the 7 million, or 29 percent, it reported in its first filing.
The difference came as the company, in its revision, said it had 26 million monthly unique log-in users in December 2010 -- the month before the quarter began -- after having originally put the number at 24 million.
Although bankers brush off concerns about the data and statistics provided by the frothy Chinese technology sector, Renren's revision highlights a broader trend of opaque reports Chinese companies provide to potential investors who are clamoring to profit from the booming pace of Internet expansion in China.
China's Internet sector -- the world's largest by users -- is red hot because it is difficult for outside competitors to overcome the political and cultural barriers to operate there, and some analysts warn of a bubble.
Renren, whose investors include private equity firm General Atlantic, hopes to tap the strong appetite for Chinese tech stocks and raise up to $584.1 million in an IPO next week. It is one of the first of a handful of Chinese "Facebooks," including Kaixin001, that are looking to boost their profile with U.S. listings.
Renren was not immediately available for comment.
Morgan Stanley, Deutsche Bank Securities and Credit Suisse are leading the underwriters on the Renren IPO. (Reporting by Alina Selyukh and Clare Baldwin; Editing by Gary Hill)
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