Category: China

Alibaba update

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It was a short while ago (last Nov) Alibaba did its high profile IPO in Hongkong. Now it’s back in the news again. Don’t get me wrong, Jack Ma (Ma Yun), the founder and Chairman of Ali, was always in the news. I remember a few years ago (when the company was private) he said Ali pays 1 millions Yuan everyday, that’s not a small number and people thought Mr. Ma was bragging. Oh, well, bragging or not. Alibaba’s IPO was very successful, and it created a few hundred millionares (stock option holders) in its employee bases, from what I read last Oct.

Fast forward to March 2008. It reported a good quarter but stock continued to drop (see Sramana Mitra at Seekingalpha). And there is a rumor about class action lawsuit coming (news in Chinese).

Alibaba 1688 stock chart
(Alibaba 1688.HK 6 month stock chart, full size pic here).

Tags 1688, Alibaba, NINE, Ninetowns

China Stocks

Bear, liquidity, soft commodity

Post author By stlplace
Post date March 14, 2008
No Comments on Bear, liquidity, soft commodity

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Bear Stern (NYSE:BSC) spoiled the market today. There was some confusion about Citic Securities recent agreement. As far as I know, according to Bloomberg, there was a small stock swap deal and potential JV. But lately they are under a talk to revise the deal. So nothing like the China Invest Co. Blackstone IPO fiasco.

Liquidity in my little portfolio
Interestingly, I found when market is in panic selling, big name stocks such as China Mobile (CHL), Research in Motion (RIMM) usually got down, and small name stock such as GSI Technology (GSIT) did not go down too much, sometimes it even went up. How come small stock got the power to fight against the market? Well, the answer lies in liquidity. When the big guys got panic, and decided to sell, they will usually sell the Microsoft, the Google, the Pizer,…because those stocks are traded millions of shares a day, and they could find buyer easily, without too much discount. This is not the case for GSIT, which trades about 50,000 shares a day. It takes a few buyer for my 500 shares.

Soft Commodity

Tags Bear-Stern, BSC, liquidity, soft-commodity, Tao-Dong

China IPO

The economy of China Economy Hotel

Post author By stlplace
Post date March 13, 2008
No Comments on The economy of China Economy Hotel

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In his annual letter to shareholders, Buffett said the “party is over”. He was referring to the insurance business, which is the cornerstone of Berkshire Hathaway.

It appears the party for the economy hotels in China is over too. You can read this Chinese article at Sina if you know Chinese. This is understandable because as the leader of this pack, Home Inns (Rujia, HMIN) got listed in the US in Nov. 2006, lots of money has been poured into this hot sector in China, notably the 7daysInn (fund by warburg pincus), Hanting (found by Home Inns founder Ji Qi, raised $85 million fund last year, about the same size of Home Inns’ IPO proceeds).

Now they are paying the price of over-investment and fierce competition thereafter. Let me quote the Chinese article:

锦江之星的这家店位于吴中路和桂林路口，这里并不是上海人气最高的地段。但在不足4公里长的吴中路周边，却挤下了莫泰、7天连锁酒店、上海优家旅店、上海东湖之旅虹锦酒店等超过8家经济型酒店，其中汉庭竟然在同一区段拥有两家店面！

English translation: JinJiang star hotel is located at intersection of WuZhong Rd. and GuiLin Rd., which is not a hot district in Shanghai. But along this less than 4km WuZhong Rd., there are more than 8 economy hotels including motel168, 7daysInn etc., and HanTing even has two hotels in this district!

Jinjiang Inn at ChangNing Rd.
(JinJiang Inn at Shanghai ChangNing Rd., March 2007, full size pic here.)

Tags HMIN, home-inns

China

Mindray buys into US market

Post author By stlplace
Post date March 11, 2008
No Comments on Mindray buys into US market

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Mindray (NYSE:MR) continued its US market expansion today, as it agreed to buy the Patient Monitoring business of DataScope (Nasdaq: DSCP) for $202 m (see this Reuters news). My gut feeling is this is a fair deal. Mindray paid about 1.25 times sales revenue for the unit. According to Reuters: “The (DataScope) unit had total revenues of $161.3 million in calendar year 2007, approximately the same as those generated from Mindray’s home China market.”

Tags DataScope, DSCP, Mindray, MR, Patient-Monitoring

China Stocks

Economist also believe in technical analysis?

Post author By stlplace
Post date February 25, 2008
No Comments on Economist also believe in technical analysis?

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By technical analysis (TA), I mean those candle charts, wave theory etc. Those are techniques day traders use frequently to make small profit out of price fluctuation. Nothing against it, but I feel those techniques are not useful for long term investors. Actually from I read, Buffett also learned all those stuff before, but obviously he did not make his fortune from TA.

The interesting point is, Ba Shu Song (巴曙松), the rising Chinese economist, seems also believed in this. From his blog post 投資港股有用網站連結, he listed some TA web sites in the end.

股票教學
咩野係股票 http://hkisc.hkstock.com.hk/hkstock/investment/ch1.htm
期權教學 http://fuweb.polaris.com.hk/home/qiquan/option28/typeoneoff.htm
技術分析教學
– http://td.hkii.org/investu/c_investuindex.php
– http://www.angelibrary.com/economic/gsjs/
– http://www.metaquotes.net/
– http://www.dick.cpcs.net/stock_game/tutorial2.php#
– http://www.pcn.com.hk/education_ma.html
– http://www.moneydj.com/z/analyst/analyst1.htm

Tags Ba-Shu-Song, Economist, Technical-analysis

China

The ad everyone is talking about

Post author By stlplace
Post date February 16, 2008
No Comments on The ad everyone is talking about

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Heng Yuan Xiang, 恒源祥, a wool clothing brand started in Shanghai since 1927, is airing the following ad in China. This Olympics sponsor TV ad is reciting 12 Chinese zodiacs (like spam). I think that’s why it got attention and also how it annoyed people, and drew critism.

Well, annoying or not, you can make your own judgement 🙂

(video from tudou.com)

Tags heng-yuan-xiang, Olympics-Ad, tudou, TV-ad, 恒源祥

China IPO

New Oriental EDU buy back

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EDU new oriental logo

A short while ago I decided not to short EDU. Today the EDU stock buy back program confirmed my reasoning. Here is their buy back plan (CNNMoney): New Oriental Education & Technology Group Inc. (NYSE:EDU) Thursday said its board had approved the buyback of 1 million American Depositary shares. The program is effective between Feb. 25 and Dec. 31, 2008.

According to Yahoo Finance, EDU has 37.54 million shares outstanding, and 3.55 million shares float. I verified it: those are ADR shares (note one ADR is equal to 4 ordinary shares for EDU).

No I haven’t got the stock buyback information from CEO Michael Yu in advance.

I remember in last conference call CFO Louis Hsieh said they would buy back stocks when they can not find other compelling opportunities (a.k.a, acquisition targets). It appears the competition landscape of China private education has been intensified in last few years.

Tags EDU, new-oriental, stock-buyback

China

5 billion text message greetings in China

Post author By stlplace
Post date February 7, 2008
No Comments on 5 billion text message greetings in China

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According to my friend Wang Jianshuo (and he got it through CCTV), Chinese people sent 5 billion text messages (SMS) for the New Year Greeting.

Separately, I picked up more China Mobile shares (CHL) today. Average down is not the best approach, I may sell some CHL (I bought at higher cost earlier) later on, if the share price goes up.

Tags China-mobile, New-Year-Greeting, SMS, text-message

China

China snow storm relief

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The unexpected snow storm hit China hard, at the worst time it could find: the Chinese New Year, when billions of people travell to their home to be with their families.

Here are some places that could use our little help.

1. China Snow Storm Disaster Relief Fund, the money will be forwarded to Red Cross China.

2. OSCCF（海外中国儿童救助基金会), note “snow storm relief“.

I will add more as I see other organizations who can help.

(picture from Boston Globe)

Tags China-snow-storm, donation, relief