Economy

New Railway Development Plan Costing $106 Billion Spurs China CSR and CNR in Shanghai

by

Chinese-trainDue to the government’s announcement that China will invest 700 Yuan ($106 Billion) in the railroads in 2011, the stocks of China’s two biggest train manufacturers, CSR Corp. and China CNR Corp., shot up in trading on the Shanghai market.

In China there is a trading limit that stocks can only go up by ten percent per day. China CNR reached its ten percent limit and CSR rose 9.8 percent after the Govenment announcement. According to Railway Minister Liu Zhijun, this investment decision is part of China’s plan to expand it railways from 91,000 Kilometers to 120,000 in 5 years. 1.68 billion passengers traveled on the railways in 2011 and freight transports rose to 3.63 billion tons which is 9.3 percent increase. Improving railways will also reduce air pollution and traffic.

In addition, a Shanghai-Beijing high-speed train line will be starting up in June of 2011 at a cost of 220.9 Billion Yuan.

Domestic Vietnamese Companies Invested $900 Million Overseas This Year

by

VietnamOf pledged investments of approximately $2.93 billion by Vietnamese companies, approximately $900 million have been invested in projects overseas. In 2010, private and state owned companies have invested in 25 countries in 107 projects according to the Ministry of Planning and Investment.

The Ministry of Planning and Investment reported that Vietnamese companies’ investments of $900 million was invested as follows: $700 million was invested in oil exploration and extraction projects, $53 million was invested in the retail trade, $70 million went into agriculture projects, $25 million was invested in energy, and $33 million was invested into telecommunications. Most of these investments have not brought any income into Vietnam because they are still in the beginning stages.

Hyundai Makes Rs400 Crore Investment In New Indian DieselEngine Plant

by

HyundaiHyundai Motors has operated successfully in India and has solidified its operating procedures there over the past several years. During the next three years Hyundai will build a new diesel engine factory costing Rs400 crore. Recent feasibility research showed this to be an appropriate investment according to the CEO. Three different sized engines will be produced.

The new factory should be opened in 2013 or 2014. It will produce diesel engines for the Indian market. These engines will be in three sizes: 1.1 liters, 1.4 lit, and 1.6 lit. Hyundai’s Sales and Marketing Director said that this year Hyundai had to use all of its production to satisfy growing local demand. In previous years, Hyundai’s Indian division was able to produce enough cars for both the Indian and foreign markets.

J.P. Morgan was Awarded Hong Kong’s Best Foreign Investment Bank

by

The Asset Triple A Award for Hong Kong’s Best Foreign Investment Bank was awarded to J. P. Morgan for the sixth consecutive year. J. P. Morgan exhibited has consistently displayed leadership through a wide variety of products. It is a major adviser to a big portfolio of blue chip clients in the Hong Kong area. They also have an ongoing repeat business.

Through the listing by introduction of Fortune Reit in 2010, J.P. Morgan instituted Hong Kong’s first bridging dealer mechanism. This mechanism allows the Hong Kong Exchange and Clearing to use introduction to approve listings.

Japanese traders increase investments in Chinese start-ups

by

Japan’s large trading companies, seeing the excellent returns from the growth of Chinese start-ups, are channeling more of their investments into these start-ups.

Mitsui & Co purchased 12.2 percent of Hutchison MediPharma Ltd, a division of Hutchison China MediTech Ltd. Mitsui sent a representative to sit on the board in China.

In order to raise the Hutchison’s corporate value, Mitsui plans to make an alliance with a Japanese pharmaceutical company.
Mitsui expects to invest approximately 3 billion yen a year in Chinese start-ups that show good potential.
Mitsui hopes to double its investment, up to 15 to 20 billion yen, in the next three years.

An anonymous Mitsui official explained that “In general, corporate value increases by 100-200 percent when a business goes public,” In addition, “It can be as high as 400-500 percent if it is a long-term investment.”

Banks Dumping Japanese Government Bonds

by

YenAs demand for loans dropped in Japan, Japanese banks bought record amounts of government debt. Now they are selling the bonds for the first time this year as prices are in free fall.

Lenders cut Japanese government debt holdings to 142.2 trillion yen ($1.7 trillion) as of Oct. 31 from a record high of143.2 trillion yen a month before, according to the Bank of Japan. The banks bought bonds in each of the previous nine months as outstanding loans fell 2.1 percent to 391.9 trillion yen, the lowest since May 2008. Government bonds lost 1.5 percent since Sept. 30, set for the worst quarter in the last seven years, indexes compiled by Bank of America Merrill Lynch show.

Thakral Sets New Strategy For Real Estate Business

by

Thakral Corporation will partner as a financial investor with with developers to implement its new strategy for its real estate business.
In its filing with the Singapore Exchange, the company wrote that as a capital investor, it seeks to invest in affordable mid-sized residential developments located in cities in Asia Pacific and Australia.

Thakral indicated that its new strategy will generate a second revenue stream for the company.

The firm is seeking returns of 15 to 25 per cent, with an exit strategy in 12 to 36 months.

Mr Singh said, “We will receive our returns and capital when the projects are completed and all units already pre-sold to buyers are settled.”

Thakral already owns commercial and residential property holdings in Hong Kong and China.

In addition to real estate, Thakral also distributes consumer electronic products in Singapore, India, China and Japan.

India Infrastructure Finance Company Ltd will issue a Rs 1200cr tax-free bond

by

India-Map2India Infrastructure Finance Company Ltd (IIFCL) will issue a Rs 1,200-crore retail infrastructure bond issue at the end of the year.

The bond issue would come in three stages of Rs 400 crore each between January and March, according to, managing director of IIFCL, S.K. Goel.

The IIFCL chief said the bonds that are AAA-rated will have a coupon rate of 8.5 per cent for 10 years and 8.75 per cent for the 15-year issue. At the end of five years both issues will have a put and call option.

The State Bank of India (SBI) bond issue received a great response from investors due to the high interest rates the bank is giving.

Cross-Shareholdings At Lowest Rates Since 1991: Japanese Banks Sell-Off Shares

by

Japanese Companies reduce their cross-shareholdings of allied companies to the lowest level since 1991. Banks sell shares due to narrower global capitalization requirements.

In the year that ended March 31, stocks owned with corporate allies dropped to 4.9 % of the nation’s shares. This represents a two-point drop from the previous year and the lowest rate since 1991.

Keisuke Nitta, a strategist at NLI Research Institute, explained that “Cross-shareholdings held by banks are based on relationships with clients, so it doesn’t mean that the shares they hold are ones that are likely to grow.”He continued “A lot of the superior shares have already been sold off. It means a lot of unattractive stocks are still on their books.”

Banks are positioning for new regulations decided upon by the Basel Committee on Banking Supervision which require Banks to double the Tier 1 capital reserve. Tier 1 capital includes cash and equities. Therefore, volatile and poorly performing stocks will lower a bank’s ability to lend.
Since the International Accounting Standards Board issued guidance last year that the current market value of shareholdings are required to be included in financial statements, companies are reducing their holdings.

Hidehiro Tomioka, who manages about $1.4 billion at the Japanese asset management u_wpnonce=b29c1b17d4

Nikkei Falls 0.84 % Due To Geopolitical Tension And Eurozone fears!

by

Tokyo stocks fell on Wednesday and the Nikkei stock index lost 0.84 percent, as tensions arose over geopolitical strife over conflagrations in Korean and the instability of the eurozone after Ireland’s debt-rating cut stressed investor feelings.

Standard & Poor’s downgrading of Ireland’s long-term debt caused fear of a domino effect in the eurozone and lowered investor confidence.
Adding to investor uneasiness are increasing tensions in Korean after artillery exchanges between the Republic of Korea (ROK) and the Democratic People’s Republic of Korea (DPRK).

Japan’s nearness to the conflagrations lead to share dumping in the Japanese market, according to some analysts.

Tokyo Electron fell 2.1 %, down to 5,150 yen. Mitsubishi Corp. lost 1.4 percent to 2,115 yen. Mitsui & Co. dropped 0.8 percent to 1, 330 yen.