Monday, August 17, 2009

Hong Kong Stock Market Wrap Aug 14th, 2009

HSI 20,891 +0.15% : HSCEI 11,899 unch : Turnover HK$62billion

Hong Kong opened up 200pts in the morning before falling away throughout the morning session. Afternoon session saw the market briefly slip lower before turning and gaining momentum to close the day in positive territory. Volumes retreated for the second day.

IPO: Sundart International (2288 HK), which is engaged in interior design and renovation for developers, was more than 720 times subscribed, attracting a combined HK$43.2 billion in funds. The international tranche of the offer was more than 10 times subscribed. Sundart is likely to price the shares at HK$4.18 each, the top end of the indicative price range, helping the firm to raise the maximum amount of HK$602 million from a share sale in Hong Kong. Sundart shares are set to commence trading on August 21. Evergrande Real Estate has changed its sponsors for its proposed Hong Kong listing. UBS withdrew last Friday while Goldman Sachs rejoined the listing plan. The sponsors of the developer’s listing are now Goldman Sachs, Merrill Lynch and BOC International. Evergrande planned to go public last year but the plan was shelved as the financial crisis hit. Sinopharm Holdings, the largest distributor in the Chinese pharmaceutical market, plans to raise up to US$700 million in its Hong Kong initial public offering next month. The company plans to issue H shares in September 25. China International Finance and UBS are the sponsors of its listing.

Resources: China Coal Energy (1898 HK), the listed entity of the country’s second-largest coal producer, first-half net profit rose 3.1 per cent to 4.35 billion yuan, helped by lower finance costs. Core operating profit, however, dropped 17.9 per cent year-on-year to 5.37 billion yuan due to lower sales volume and selling prices on falling coal exports. China Coal recorded a huge paper loss on China Cosco shares last year after the stock market bubble burst, but realized a 166 million yuan gain this year from selling the shares taking advantage of the market recovery. Sino Union Petroleum & Chemical (346 HK) has agreed to pay HK$4.8 billion for five mainland coal mines from Capital Kingdom, which is 67 per cent-owned by chairman Hui Chi-ming. Capital Kingdom bought last month the coal mines for merely HK$3.66 billion and would book a gain of HK$1.14 billion from the deal. Sino Union will pay by issuing HK$2.5 billion worth of new shares at 90 HK cents each and convertible notes. Trading in the company’s shares will resume today. Gold producer Zhaojin Mining (1818 HK), its first-half net profit surged 49 per cent to nearly 32 million yuan on a rise in self-mined gold output. Turnover surged 41 per cent to 1.06 billion yuan. Earnings per share jumped 46.67 per cent to 22 fen. No interim dividend was declared.

Insure: Ping An Insurance (2318 HK), China’s second-largest life insurer, said first-half net profit fell 45 per cent to 5.22 billion yuan because of higher costs and a lower profit contribution from realised equity investment gains. The Shenzhen-based insurer said it increased its equity investment amid the A-share market rally and lowered the proportion of its fixed-income asset holdings in the second quarter. Ping An declared an interim dividend of 15 fen, down 25 per cent from a year earlier.

Powers: Shanghai Electric (2727 HK) net profit for the six months to June fell 11 per cent to 1.37 billion yuan on falling power demand. The company proposed no interim dividend. Datang Power International Power Generation (991 HK) said first-half net profit amounted to 722 million yuan, up 53 per cent from a year earlier. The Beijing-based company, profit jump was due to higher power prices and lower coal costs that offset the impact of lower plant utilization. No interim dividend was declared. Meanwhile, Datang said parent China Datang Group had agreed to take a 40 per cent stake in its 16.2 billion yuan coal-to-chemicals project in Inner Mongolia.

Xiamen International Port (3378 HK), its interim profit for the year ended June 30 dived 64 per cent year-on-year to 25 million yuan due to profit reduction in its port service and material business. The company forecasts that profit for the first three quarters would drop 67 per cent.

Beijing Capital International Airport (694 HK), which operates the city’s airport, net profit for the six months to June surged 86 per cent to 105 million yuan because of increased traffic brought about by the central government’s stimulus measures. Revenue grew 15 per cent to 1.51 billion yuan. Earnings per share jumped 71 per cent to 24 fen. No interim dividend was declared.

Intime Department Store (1833 HK) has agreed to sell 50 per cent shares of Hangzhou tourist spot “Shopping Street” to its chairman Shen Guojun for 514 million yuan. The company sold the project because it was not a core business, and it had been making loss since it was acquired in December 2007.

Tianneng Power (819 HK) said net profit for the six months ended June increased 4.1 per cent from a year earlier to 126 million yuan. Earnings per share were 12.6 fen. The company proposes no interim dividend.

Sources: Sing Tao Finance, Hong Kong Economic Journal, Hong Kong Economic Times