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from Breakingviews:

Li Ka-shing still has what investors want


By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Li Ka-shing may be an octogenarian but he still knows when to buy and sell. An analysis of 16 listed parts of the Hong Kong tycoon’s telecoms-to-energy empire, with a combined market capitalization of more than $170 billion, shows a mixed record of delivering shareholder returns. Yet Li’s flagship holding companies have matched or beaten the market over the past two and five years. For investors, it pays to invest as close as possible to the man himself.

Graphic: Does Li Ka-shing still have his golden touch?

Start at the top of the chain. Total shareholder returns from Cheung Kong Holdings, in which Li directly owns a 43 percent stake, and Hutchison Whampoa have outpaced those of the Hang Seng Index by as much as 3 percentage points over the past two years, and 5 percentage points over five years, according to Datastream. That’s despite a substantial discount to the sum of their parts that dates back to when Li began to invest in 3G technology in 2000. Both companies trade around one-third below their net asset value, according to brokerage CLSA.

Look further down the chain and returns are more mixed. The worst-performing bits of Li’s empire have been Hutchison Whampoa’s telecom business in Hong Kong and Hong Kong-listed property investment vehicle Hutchison Harbour Ring. The best have been some of Li’s real estate investment trusts, owned partly by Cheung Kong Holdings and Hutchison Whampoa. Cheung Kong Holdings’ local subsidiary CK Life Sciences has also delivered outsized returns.

from Breakingviews:

South Korea’s next leader will face a currency war

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Andy Mukherjee

Every new South Korean president has to contend with sabre-rattling by Pyongyang. It won’t be any different this time. North Korea’s recent rocket launch shows just what kind of reception the next occupant of Seoul’s Blue House can expect from across the demilitarized zone.