August 2007 – Page 5

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Last Updated on August 7, 2007 by stlplace

Shanghai is an expensive city. I’m not talking about the red hot housing market, we all know the housing is getting very expensive here. I was talking about the relative income vs. spending.

Income
Yesterday evening an old friend of mine, who works for a investment research firm, told me a fresh graduate is paid CNY 3,000. This is actully fairly high pay for new college graduate, cosidering financial is a hot area, and the fresh graduate is from Tsinghua/Bei Da (think that as MIT, or Harvard of China), with very good spoken English.

Experienced people are paid more. I learned from anothetr friend who is a HR executive, about 10% of people makes more than CNY 10,000 per month. Note this is also the threshold of income tax.

In the IT arena, I know some senior developer positions at MSFT pays more than 20,000 Yuan per month. I believe other multinational companies should have equivalent pay.

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Last Updated on August 8, 2007 by stlplace

I read its earning report this morning (Shanghai is 12 hrs ahead of US EDT). They reported an inline quarter. In the past that could send the stock tank. Not this time, because the stock has been down 27% since Jan 1. The expectation is already very low. With a PE about 33, and revenue growth of 20%, and a superior brand, I believe its future in the long term.

Let me talk things beyond the earnings. In the Cloud 9 (shopping mall and office building, where I work these days) there are 2 Starbucks stores. Around Zhongshan park I’m aware of 4 stores total.

According to “Shanghai Metro” newspaper yesterday, Coca cola is the No. 1 brand in the world, it brand is est. valued at $65 b (I believe its market cap is more than $100 b). Starbucks is not on the top 10, but could it fetch $ 6.5 b? Note SBUX has a market cap of about $20 b lately.