Finance

All in the Family: Cash-strapped ZhongAn Taps Chairman’s Ties to Fund a Money-losing Unit

Sinolink, majority-owned by ZhongAn’s chairman Ou Yaping, will provide about $103 million in fresh capital for a ZhongAn unit that develops businesses overseas Key Takeaways: Sinolink will buy about 156 million new shares in ZhongAn’s overseas business development unit, ZhongAn International, for about $103 million The deal comes in a difficult year for ZhongAn, whose own cash holdings are dwindling By Warren Yang Created in 2013 by Alibaba-affiliated (BABA.US; 9988.HK) Ant Group, Tencent (0700.HK) and Ping An Insurance (2318.HK; 601318.SS), ZhongAn Online P&C Insurance Co. Ltd. (6060.HK) has been working…

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U.S.-China Audit Deal Won’t Slow Hong Kong Dual Listing Train, Analysts Say

The landmark information-sharing agreement won’t dispel concerns over delistings of Chinese firms from New York until the deal is smoothly implemented Key Takeaways: Despite a landmark U.S.-China information-sharing agreement, some predict dual listings in New York and Hong Kong will remain the preferred choice for Chinese stocks UBS estimates Hong Kong Stock Exchange trading volume could rise up to 25% if all U.S.-traded Chinese stocks delist from New York and move to Hong Kong By Ken Lo The new information-sharing agreement between U.S. and China stock regulators was a welcome…

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Credit, Anyone? China’s Online Loan Platforms Get Stuck as Quality Borrowers Dwindle

Three online loan facilitators reported second-quarter profit declines of varying degrees, as China’s slowing economy forced them to prioritize risk management over revenue growth Key Takeaways: FinVolution’s revenue growth slowed to about 12% in the second quarter from 16% and 32% in the previous two quarters, while its latest quarterly net profit fell about 6% 360 DigiTech and Lexin posted little or no revenue growth for the quarter, as their profits plunged 37% and 80%, respectively, during the period By Warren Yang It’s difficult for any lender to grow its…

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KE Holdings Deconstructed by Slumping Real Estate Market

The residential property broker’s revenue tumbled by more than 40% in the first half of the year, sending it into the red Key Takeaways: KE Holdings swung to the red in the first half of the year on the back of a slumping Chinese real estate market The company is trying to offset anemic property trading income with new businesses that are growing but still account for just a small share of revenue By Tina Yip The Chinese real estate market has moved into the doldrums, the result of government…

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China, U.S. Stock Regulators Hope New Agreement Will Succeed Where Others Haven’t

New information-sharing deal will give U.S. accounting regulator access to audit records for New York-listed Chinese firms. But will it really get what it wants? Key Takeaways: Having reached a tentative deal that could remove the delisting threat for U.S.-traded Chinese stocks, China and the U.S. will conduct a trial period through the end of this year Different interpretations on reciprocity and cooperation could become stumbling blocks that ultimately derail the deal – following the failure of two previous agreements By Doug Young Will the third time be the charm?…

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OneConnect Inches Closer to Profits Under Leadership of New Chairman

The technology-as-a-service provider’s net loss narrowed substantially in the second quarter, as it continues trying to cut costs and expenses Key Takeaways: OneConnect’s revenue increased 17% in the second quarter, while its loss narrowed by nearly a third The company promoted CEO Shen Chongfeng to the additional role of chairman, consolidating its leadership into a single executive By Warren Yang Financial technology service provider OneConnect Financial Technology Co. Ltd. (OCFT.US; 6638.HK) is continuing to make strides in its journey to profitability, as reflected in its latest financial results that show…

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Is Tencent Winding Down Its Big Investments?

A report that the tech giant is looking to sell its Meituan stake is stoking concerns of more similar divestments to come Key Takeaways: Reuters reported Tencent might sell some or all of its Meituan holdings this year, though Tencent called the report ‘inaccurate’ Some think Tencent might sell other stakes in its more than 70 U.S.- and Hong Kong-listed portfolio companies to raise funds to buy back its shares By Fai Pui China’s anti-monopoly crackdown of more than a year has taken a toll on the nation’s private sector,…

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SMIC Warns of Industry Downturn as U.S. Sanctions Cloud Its Future

China’s top chipmaker’s second-quarter results matched market expectations, but it warned of a cyclical slowdown in the global semiconductor industry Key Takeaways: SMIC’s second-quarter revenue rose by 40% year-on-year and 3.3% quarter-on-quarter, but the company forecast possible flat sequential growth in the third quarter The U.S. has tightened restrictions on semiconductor equipment exports to China, which will reportedly impact SMIC’s 12-inch fab construction By Ken Lo As a leading force in China’s drive to build up its chip sector, Semiconductor Manufacturing International Corp. (SMIC, 0981.HK; 688981.SH) has become a lightning…

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AMTD Digital Becomes Unexpected Meme Stock. And Surprise – It’s Already Crashing

The company’s shares soared as much as 21,426% in the weeks after its IPO last month, making it Wall Street’s newest meme stock Key Takeaways: Shares in digital financial services incubator AMTD Digital spiked to as high as $1,679 following their July 15 trading debut from an IPO price of $7.80 The dramatic surge is reminiscent of last year’s saga involving GameStop, whose stock skyrocketed, fueled by retail investors looking to punish short sellers By Warren Yang Shares of newly listed financial services incubator AMTD Digital Inc. (HKD.US) have gone…

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Alibaba Eyes Hong Kong Primary Listing as Hedge to U.S. Delisting Threat

Primary listing in Hong Kong in addition to its New York listing could also make the e-commerce giant’s shares accessible to mainland China investors Key Takeaways: Alibaba said it expects the upgrade of its secondary Hong Kong listing to primary listing status to be complete by the end of 2022 The SEC has placed Alibaba on a list of Chinese firms facing potential delisting as the deadline nears for U.S.-listed Chinese firms to comply with American audit rules By Ken Lo Alibaba Group Holding Ltd. (BABA.US; 9988.HK) applied for a…

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