Breakingviews

Missing motorbikes point to Indonesian demand hole

June 19, 2015

A 36 percent slide in motorcycle sales in May shows just how fast falling commodity prices are eroding purchasing power. More worrying, however, is President Joko Widodo’s failure to offset the shortfall by boosting investment. A weakening currency is compounding the challenge.

AirAsia takes multi-stop route to capital-raising

June 18, 2015

Concerns over debt and accounting have hammered shares in Asia’s largest budget carrier. It says a rights issue isn’t needed and can recoup cash from overseas offshoots. But this requires investors to put fresh capital into the loss-making affiliates. That won’t be an easy sell.

How to tell if Japan’s shareholder love-in is real

June 15, 2015

Japan Inc. faces unprecedented pressure to get leaner, better-run, and more profitable. Real success means higher returns on equity. First comes a tough AGM season that could embarrass the likes of Sony and Sharp. Then expect more buybacks, stake sales, activism and M&A.

Return to China tough for American orphan stocks

June 12, 2015

Soaring home markets are prompting Chinese companies to delist from U.S. exchanges. The likes of social network Renren and data centre group 21Vianet may hope for higher valuations in China. But rigid rules make mainland listings harder. Only the unloved will attempt the journey.

Hardball Samsung move sets up chaebol reform test

June 11, 2015

Samsung C&T has sold a 6 pct stake to a friendly party to neuter opponents of its $10 bln merger with the South Korean conglomerate’s holding company. Official reaction to the underhand maneouvre will show whether the country really wants to rein in its large corporations.

MSCI lets fund managers ignore China a bit longer

June 10, 2015

The index compiler says China’s $10 trln stock markets aren’t quite ready for global benchmarks. That’s a relief for investors worried about inflated mainland valuations. But inclusion is only a matter of time. Being underweight will soon be a matter of choice, not inertia.

Tesco’s South Korean unit stacks up for a buyout

June 9, 2015

A disposal for around $6 bln would do much to fix the British grocer’s strained balance sheet. Tesco might not miss the Korean earnings that much either. It’s hard to see trade buyers bidding up the price. But it presents a rare opportunity for private equity in Asia.

Japan’s GDP lift is bounty from currency war

June 8, 2015

Output grew 3.9 percent in the first quarter, much faster than the 2.4 percent rate previously estimated. Investments made all the difference. Japanese exporters are ramping up capacity as they use the weak yen to fight for market share. Higher wages may be the next hopeful sign.

Review: Growth pains for Asia’s eco-capitalists

June 5, 2015

A new book by Mark Clifford hails green business as the antidote to Asia’s environmental crisis. But the eulogy inadvertently highlights companies’ unhealthy dependence on subsidies and debt. Clean-tech businesses must confront this flaw if they are to live up to the hype.

India GDP growth is one-third statistical illusion

June 5, 2015

Official data have become utterly unreliable. A Breakingviews analysis of corporate and consumer behaviour suggests growth is now closer to 5 percent than the 7.5 percent claimed by the authorities. Investors are quite right to be upset by half-hearted monetary easing.