Monday, September 7, 2009

Hong Kong Stock Market Wrap Sept 4th, 2009

IPOs: Lilang China, the mainland manufacturer and wholesaler of men's apparels, plans to issue 300 million shares instead of 200 million shares in its initial public offering on September 11, sources said. The company plans to launch its new brand “L2” which targets on young men fashion market next year.

Financials: Bank of Communications (3328 HK) gains approval from regulatory to buy 51 per cent stake in China CMG Life Insurance Company, becoming the first mainland bank which has holdings in insurance business. The lender said it is the first step of multi-operation development. HSBC Holdings (5 HK) said HSBC Bank Polska SA has agreed to sell its HSBC Credit branded consumer finance portfolio, and its credit card portfolio, to Alior Bank SA. The gross asset value of the two portfolios was US$350 million on July 31. The deal is expected to be completed in the fourth quarter. HSBC has submitted its buyout suggestion to ING to bid its investment banking for HK$12.7 billion. The ING buyout is one of the bailout measures of Dutch government to save the lending business in its country. HSBC is one of the five bidders. The other bidders include DBS and Julius Baer. The preferred bidder will be announced within ten days.

Properties: SPG Land (337 HK) recorded a net profit of 202.18 million yuan for the first half, rocketing 132.63 per cent compared with a year ago. The company attributed the gain to the surging sales in Shanghai. Earnings per share were 0.196 yuan. An interim dividend of 0.0295 yuan per share was declared.

Resources: Titan Petrochemicals (1192 HK) posted a first-half net loss of HK$53.8 million for the year ended June 30. The loss has been narrowed down from the HK$287 million loss last year. Losses per share were 0.83 HK cent. No interim dividend was declared. Citic Resources (1205 HK) reported yesterday a HK$307 million net loss for the first half, against a HK$520 million net profit last year. The company attributed the loss to the drops in demands and prices of energy and products. Losses per share were 5.08 HK cents. No interim dividend was declared.

Telecomm: China Unicom (762 HK) and Telefonica have agreed to have a mutual investment of US$1 billion in each other’s companies to strengthen their cooperation on the networks. Under the agreement, the Spanish telecommunications company will subscribe to 690 million new shares at HK$11.17 each in the mainland mobile company, increasing its stake to 8 per cent from 5.38 per cent. In return, Unicom will acquire 41 million shares or a 0.9 per cent stake in Telefonica at 17.24 Euro (HK$190.55) each.

Shares of Beijing Enterprises Water Group (371 HK) were offloaded by its major shareholder, Pioneer Wealth, as it rallies. Pioneer Wealth sold 109 million holdings of the company for HK$161 million at a 10 per cent discount to its initial price.

Beijing-based energy enterprise Huaneng Power (902 HK) announced that it will issue 5 billion yuan 9-month financial bills on September 9. The bills have no collateral and will be issued at par and the interest shall be decided by the resulted bookkeeping. Around 2.5 billion yuan of the proceedings will be used for repayment of bank loans and swap liabilities, while the rest 2.5 billion yuan will be applied in routine operational expense such as purchases of coal fuel and materials for power generators.

Qin Jia Yuan Media Services (2366 HK) announced that it has agreed to establish a joint venture with IMPACT Entertainment (International) to develop concert and entertainment markets in China. Qin Jia Yuan has invested 30 million yuan and it holds 65 per cent stake of the joint venture.

Nagacorp (3918 HK) recorded a 55 per cent year-on-year decline in its interim net profit to US$ 11.5 million (HK$90 million), dragged down by the poor performance of its casino and hotel business under the financial tsunami. An interim dividend of HK$ 2.57 HK cents per share was declared.

Consumer: Vinda International (3331 HK) recorded a 191.7 per cent year-on-year rise in its net profit to HK$ 180 million, benefited from the lower cost of raw materials and a 13.6 per cent increase in sales. The company proposed an interim dividend of 3 HK cents per share.

Weiqiao Textile (2698 HK) announced yesterday that its net profit rose 44.7 per cent to 394 million yuan for the first half, dragged down by weak overseas demand for textile. Earnings per share were 0.33 yuan. No interim dividend was declared.

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