Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  Equities  >  Stock Exchange of Hong Kong  >  Tencent Holdings Ltd    0700   KYG875721634

TENCENT HOLDINGS LTD (0700)
Mes dernières consult.
Most popular
Report
End-of-day quote. End-of-day quote  - 11/23
419.6 HKD   -1.69%
11/23 TENCENT : Grant of Options
11/22 TENCENT : QQ teams up with Justice League; Box Office takes in over ..
11/22 TENCENT : Global stocks advance after Wall Street gains
SummaryChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector newsTweets

Tencent Unit's Hong Kong IPO Draws a Crowd

share with twitter share with LinkedIn share with facebook
share via e-mail
0
11/01/2017 | 02:09pm CET
By Saumya Vaishampayan 

The tech-stock ardor sweeping the world has reached Hong Kong, judging by the response to China Literature Ltd.'s initial public offering.

Orders for the IPO of the Tencent Holdings Ltd. unit, expected to raise $1.1 billion next week, have already topped $100 billion. Institutional investors have ordered more than 50 times their allotted shares; retail investors have been even keener, oversubscribing some 620 times.

The fever for China Literature, which operates an online library and has nearly 200 million monthly active users, partly reflects a phenomenal year for tech stocks globally. U.S.-listed shares of Alibaba Group Holding Ltd. have soared 111% in 2017, while Facebook Inc. shares have jumped 57%.

China Literature's links with Tencent are also a big draw for local investors, who hope some of its magic will rub off on the over-60%-owned subsidiary. Formed through a combination of Tencent Literature and Cloudary in 2014, China Literature makes money when its users pay to access books after reading the first few chapters free.

Tencent's domination of internet gaming and social networking in China--the latter via its hugely successful WeChat app--have helped it grow into one of the world's most valuable tech companies. Its own Hong Kong-listed shares have risen 90% this year.

China Literature is also benefiting from scarcity value. Tech stocks accounted for just 12% of Hong Kong's benchmark Hang Seng Index in September, compared with financials' 48%, according to Hang Seng Indexes. In the U.S., tech is the largest segment of the S&P 500 index, accounting for a quarter by weighting.

In September, Hong Kong retail investors placed orders for 393 times the initially available shares in internet-based insurance company ZhongAn Online Property & Casualty Insurance Ltd, co-founded by Alibaba founder Jack Ma. The stock is up more than 30% from its IPO price, according to FactSet.

The appetite for China Literature's IPO has helped drive up short-term interbank borrowing costs in Hong Kong this week, as investors using borrowed funds to place orders for shares effectively locked up piles of Hong Kong dollars. The overnight interest rate hit a nine-year high Tuesday, and though it fell back Wednesday, it remains elevated compared with levels earlier this year.

"This happens for very welcomed IPOs," said Iris Pang, a China economist at ING. The liquidity squeeze can be amplified when more than one popular company goes public at once, she added. Videogame-equipment maker Razer Inc. is looking to raise up to $630 million in Hong Kong this month.

China Literature and ZhongAn notwithstanding, Hong Kong's IPO market has been somewhat deflated this year. A total of 117 companies with a combined deal value of $13.1 billion have listed this year, according to Dealogic. That is the smallest year-to-date deal value since 2013.

Controversy has arisen over the quality of some companies listing in the city in recent years, in particular mainland financial companies that get heavy backing from "cornerstone investors"--who typically agree to buy big stakes before IPOs and hold them for a set period--only to perform poorly after the IPO. Such investors anchored Postal Savings Bank of China Co.'s 2016 IPO, at the time the world's biggest in two years. The bank's shares have risen just 11% in 2017, far behind the Hang Seng Index's 30%.

The stock price of Chinese brokerage Guotai Junan Securities Co., whose cornerstone-backed IPO was Hong Kong's biggest so far this year, fell in the month after the company went public in the spring, though it has since rallied. China Literature's IPO is set to be largest in Hong Kong this year not backed by cornerstone investors, according to Dealogic data.

Hong Kong listings facing other problems. The city's securities regulator said last month it is investigating 15 financial firms for their work on arranging shoddy IPOs in recent years that have caused investment losses in the billions of dollars.

As China Literature prepares to go public, two Hong Kong-listed global companies--mining giant Glencore PLC and handbag maker Coach Inc., which was recently rebranded as Tapestry Inc.--this week said they plan to delist, citing low trading volumes and lack of investor interest.

Write to Saumya Vaishampayan at [email protected]

share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on TENCENT HOLDINGS LTD
04:55a TENCENT : Good Week - Bad Week
04:55a TENCENT : DINNER PARTY INTEL...The topics you have to be able to discuss this we..
03:06a JSE weaker as Naspers softens
11/23 HSI opens up 29 pts to 30,033; H-share up 29 pts to 11,988
11/23 TENCENT : Grant of Options
11/23 ALIBABA : Net firms to curb illegal wildlife trade
11/23 Hope PUBG doesn't become a money game
11/23 HSBC : HSI opens up 269 pts to 30,087; H-share up 124 pts to 11,998
11/22 TENCENT : QQ teams up with Justice League; Box Office takes in over RMB 400 mill..
11/22 TENCENT : Global stocks advance after Wall Street gains
More news
News from SeekingAlpha
11/22 The Era Of Good Feelings - Cramer's Mad Money (11/21/17)
11/22 Tencent bringing top game to China with edits
11/22 WALL STREET BREAKFAST : Traders Digest Fed Minutes Before Thanksgiving
11/22 Hang Seng smashes through 30,000
11/21 THE BAK PORTFOLIO :  Making Money On Cannabis And Tech
Financials ( CNY)
Sales 2017 239 B
EBIT 2017 79 145 M
Net income 2017 64 436 M
Finance 2017 63 549 M
Yield 2017 0,21%
P/E ratio 2017 52,01
P/E ratio 2018 41,28
EV / Sales 2017 13,8x
EV / Sales 2018 9,80x
Capitalization 3 372 B
Chart TENCENT HOLDINGS LTD
Duration : Period :
Tencent Holdings Ltd Technical Analysis Chart | 0700 | KYG875721634 | 4-Traders
Technical analysis trends TENCENT HOLDINGS LTD
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 37
Average target price 371  CNY
Spread / Average Target 5,1%
EPS Revisions
Managers
NameTitle
Hua Teng Ma Chairman & Chief Executive Officer
Chi Ping Lau President & Executive Director
Yu Xin Ren COO & President-Interactive Entertainment Group
Shek Hon Lo Chief Financial Officer & Senior Vice President
Zhi Dong Zhang Chief Technology Officer
Sector and Competitors
1st jan.Capitalization (M$)
TENCENT HOLDINGS LTD122.72%511 673
NASPERS LIMITED83.68%122 463
NETFLIX58.58%84 954
WEIBO CORP (ADR)194.43%25 679
58.COM INC (ADR)180.50%11 561
COSTAR GROUP INC63.39%11 162