Chinese ADR Buyouts in Progress (Update)

Stabilization of the Chinese domestic markets has improved prospects for completion of a majority of the ADR buyouts announced this year.  In the past week shareholders approved the buyout of Shanda Games (GAME) and the buyout was Sungy Mobile (GOMO) was approved and closed. The CSI 300 market cap weighted index of the 300 largest … Continue reading Chinese ADR Buyouts in Progress (Update)

Advertisements

A Look at Xinyuan Real Estate’s Asset Turnover

Xinyuan Real Estate has suffered from its overexpansion in late 2013 and early 2014: Launching projects in markets where it did not have a well-developed brand (Chengdu, Changsha, and Sanya) High prices paid (Shanghai 14526 RMB/sqm, Chengdu 4150 RMB/sqm, and Suzhou 5816 RMB/sqm) The consequences of this overexpansion into a weakening market have been: Amidst the challenges … Continue reading A Look at Xinyuan Real Estate’s Asset Turnover

Impact of Recent Vehicle Sales Trends on US Listed Chinese Auto Suppliers

Passenger Vehicle sales in China rebounded in October to a year-over-year gain of +13.3% following a 50% reduction in the purchase tax on smaller vehicles.  10 month YTD sales were +3.9%.  The long-term outlook remains mildly favorable due to the country's low level of vehicle ownership and rising personal incomes. Commercial Vehicle sales in China … Continue reading Impact of Recent Vehicle Sales Trends on US Listed Chinese Auto Suppliers

US Listed Chinese companies are finding ways to access the Chinese Equity Market

The 30+ pending buyouts of US listed Chinese companies are driven by the higher valuations available to similar businesses in the domestic Chinese equity market.  But recent announcements demonstrate ways that companies can issue shares in China without undergoing privatization restructuring and relisting: Soufun will inject assets into an existing Shanghai listed shell company CNinsure … Continue reading US Listed Chinese companies are finding ways to access the Chinese Equity Market

McKinsey Report: Five Myths about the Chinese Economy

A new report argues against five common pessimistic beliefs: China has been faking it China's economy lacks the capacity to innovate China's environmental degradation is at the point of no return Unproductive investment and rising debt fuels China's rapid growth Social inequalities and disenfranchised people threaten stability Full report available here

China IPO freeze will end in two weeks

Press reports indicate that the China Securities Regulatory Commission has granted approval for resumption of domestic IPOs from November 20: Reuters: China resumes IPOs as stock market revives NYT: China Plans to Lift Moratorium on I.P.O.s by End of Year This should increase the likelihood that pending buyouts of US-listed Chinese companies will be completed. IPO of … Continue reading China IPO freeze will end in two weeks