The Asian universe of income stocks is witnessing a wave of positive dividend surprises in 2013. The market has generally reacted favourably to this theme and we expect the trend to continue as dividend per share growth has lagged earnings per share revisions since 2011. With capital expenditure intensity falling for the Asian universe and corporate balance sheets in the region remaining strong, we believe the environment is ripe for further positive dividend surprises.
Source: Datastream, CLSA Asia-Pacific Markets, March 2013. Data rebased to 100.
Investments in this region continue to benefit from positive share price reactions, driven by rising dividend payout ratios and continuing strong operational trends. We also believe that valuations for dividend growth companies remain at appealing levels. Two examples of stocks that have provided dividend surprises are property developer Wharf Holdings and technology firm Asustek Computer.
Wharf Holdings focuses on property and infrastructure development and investment in Hong Kong and mainland China. The company’s 2012 fiscal year (FY) results revealed a 55.7% dividend per share increase, year-on-year, which was significantly above consensus estimates. At an operational level, strong retail sales are continuing to drive the Hong Kong business and in China contract sales are expected to increase by up to 33% in 2013. Despite a rise of 85% in the price of the stock over the last 12 months, we believe the valuation is still attractive as it trades at a significant discount to its net asset value and on a price to book ratio below one.
Asustek is a leading technology company in Taiwan that designs and develops electronic-based products including PC components, such as motherboards, notebook computers and smartphones. FY 2012 dividends per share increased by an impressive 31% to 19 New Taiwan (NT) dollars, when many of its technology sector peers do not pay a dividend. Meanwhile, the company recently raised NT$4.66bn (US$158m) from the part sale of its shareholding in Pegatron, its former motherboard and graphics card subsidiary. The firm was spun-off in 2010 to increase Asustek’s competition with the likes of Dell, Hewlett Packard and Intel. The proceeds from the disposal, which takes Asustek’s stake in Pegatron to below 20%, could be returned to shareholders in the form of dividends.
Foto: Alvesgaspar. La volatilidad no es motivo de pánico, sino una oportunidad para entrar en el mercado
The steep correction in the Japanese stock market since last week and the recent rise in bond yields (JGBs and USTs), coupled to lower inflation readings in the developed world and some allegedly disappointing economic data (HSBC PMI for China) have raised questions about the possibility of a directional change in the markets.
Axa IM believes that these concerns are exaggerated. The global economy is progressively healing, beginning with the US consumer sector and fears of a hard landing in China are unjustified. The asset manager also believes that deflation is unlikely to take root and, therefore, that global fundamentals remain positive for equities and negative for government bonds.
Yet, as the world comes closer to a fundamental shift in the stance of US monetary policy, as well as to the implementation of a monetary experiment in Japan of a scale never seen before, Axa thinks it should be no surprise to witness higher volatility in financial markets, adding that as long as global fundamentals remain well oriented, they would rather see downside corrections in risk assets as buying opportunities.
Axa IM’s two main investment conclusions are:
Japanese Equities: buy on dips but mind the beta factor
Stay away from US Treasuries and do not fear a JGB market crash
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Wikimedia CommonsFoto: Art Comments. UBS se convierte en socio global de Art Basel
Art Basel is delighted to announce a new global partnership with its long-term partner UBS. As Art Basel’s Lead Partner, UBS will support Art Basel on a global level and across its shows in Basel, Miami Beach and Hong Kong. The multi-year agreement commences on May 28, 2013, and is a testament to both organizations’ shared aspiration of creating a global platform for the exchanges that drive the art world forward, and the development and promotion of the visual arts.
The announcement coincides with the 20th anniversary of the organizations’ partnership for the Basel show. In 2000, UBS extended its support to Unlimited, Art Basel’s unique exhibition platform for museum-quality artworks that transcend the traditional art fair stand, and in 2002 UBS became the founding partner of Art Basel’s show in Miami Beach.
From its second edition, UBS will become the Lead Partner of Art Basel in Hong Kong, which next year will take place from May 15 to 18, 2014 at the Hong Kong Convention and Exhibition Center.
Sergio Ermotti, Group CEO UBS, said: ‘We are proud to be a global partner of Art Basel’s shows in Basel, Miami Beach and now in Hong Kong. We share a passion for art and have been actively supporting cultural and artistic endeavors across the world for many years. This new collaboration ideally complements our existing portfolio of sponsorships and underlines our ongoing commitment to supporting and promoting contemporary art.’
Fitch Ratings will host its annual Global Banking Conferences in nine cities, beginning Monday 10th June 2013 in Frankfurt. The conferences will highlight key credit and regulatory trends for the global banking industry, as well as individual regions.
Some of the featured presentations and panel discussions include:
The End of Growth? Global Growth Challenges in a Highly Indebted World
Why are 2013 and 2014 So Pivotal for European Banks?
U.S. Banks: What are the New Banking Realities?
Chinese Banks: Why Shadow Banking Risks are a Concern
Is Banking Union Positive or Negative for Eurozone Bank Default Risk?
Senior members of Fitch’s global Financial Institutions and Sovereigns team will lead the presentations. Several of the conferences will also feature a guest panel discussion with leading industry figures.
The Park Hill Group, a division of Blackstone, today announced that Pablo Calo has joined its secondary advisory business as a Managing Principal, based in London. This business delivers liquidity and capital solutions to private equity investors and managers.
Calo has spent the last sixteen years dedicated to private equity, most recently as the Head of European Private Equity Secondaries at PineBridge Investments (formerly AIG Investments). Prior to this, Calo spent nine years at AIG Capital Partners, in both New York and Buenos Aires. At Park Hill, Mr. Calo will focus on providing secondary advisory services to clients across Europe.
Larry Thuet, a Senior Managing Director at Park Hill, said, “We are delighted that Pablo has joined us. He brings a strong tenure as a secondary investor, insight as limited partner and extensive experience in direct and mezzanine investments globally. Pablo will complement our team, which collectively has almost 80 years of experience and completed $11.5 billion in volume of secondary transactions.”
Wikimedia CommonsFoto: poison orange. Edgar, Dunn & Company abre una nueva oficina en Ciudad de México
Edgar, Dunn & Company (EDC) is proud to announce the official opening of its new office in Mexico City. The inauguration is part of EDC’s expanding footprint in Latin America and reinforces its presence in the region.
“Payments services are increasing in sophistication and we believe that our presence in Latin America will go a long way towards supporting our clients with the new challenges these developments represent for the industry.”
“EDC is committed to our payments and financial services clients by providing consulting services in Latin America. Our new office ensures that we have people on the ground to support and grow our relationships and provide the required level of service that we are known for,” says Bob White, Managing Director.
Jan Smith, a Director at EDC and a payments expert with twenty years of consulting experience within Latin America, will head the new office. Jan will promote EDC’s services among Latin American and foreign-based clients in the payments and financial services arena.
“In recent years, Latin America has increased in importance to our existing clients, and we also appreciate the growing need among regional players for our services,” said Smith. “Payments services are increasing in sophistication and we believe that our presence in Latin America will go a long way towards supporting our clients with the new challenges these developments represent for the industry.”
The recent gold price falls followed by record physical gold buying, concentrated in China and India, have shone a light on the paper and physical gold markets. A range of opinions exist on the workings of these markets, but where is the gold price really set?
Gold futures markets are worth $75 billion, with the Chicago Mercantile Exchange accounting for 85% of this
Only 5% of COMEX open interest is backed by bullion in depositories
The four most popular gold-backed ETFs are worth over $59 billion
The gold ETF, GLD, accounts for nearly 60% of the ETF market
The ten 10 largest gold refineries have annual capacity of 5,000 tonnes
Valcambi, the largest refinery, has capacity of 1,400 tonnes worth a potential $63bn
Head of Research, Jan Skoyles , comments: “With recent tremors in the gold market, the increasingly obvious disparity between physical and paper gold, and recent rapid draining of COMEX inventories, where gold price discovery really happens is increasingly in the spotlight.”
Wikimedia Commons. Purchase of shares, transfers and balance inquiries at the summit of Mount Everest
Two mountaineers have set a world record by being the first to use a mobile banking app on Mount Everest. Climbers Horacio Galanti , from Grande Prairie in Alberta, Canada, and Horacio Cunietti, of Mendoza, Argentina, achieved the feat using Standard Chartered Breeze mobile banking apps during their expedition to summit the highest peak in the world; an altitude of 8,848 metres above sea level.
Coinciding with the 60th anniversary of the first ascent of Mount Everest by Sir Edmund Hillary and Sherpa Tenzing Norgay on 29 May 1953, the two Horacios are aiming to climb into the Guinness Book of World Records. In a series of firsts for banking, they have successfully traded shares with Breeze Trade and conducted funds transfers with Breeze Banking at various stages around the summit of Mount Everest.
These achievements come after they made history earlier in their journey with the world’s first stock trade for 50 Standard Chartered shares (2888.HK) at the Mount Everest South Base Camp at 5,364 metres using the Breeze Trade app. Apart from proving that with Standard Chartered Breeze, banking is possible anywhere and anytime, the duo are also serving an environmental purpose by helping in the restoration of Mount Everest by recovering debris left behind by other expeditions over the decades.
Breeze mobile banking apps were developed in Singapore and now they’ve reached the top of the world.
Foto: Chenisyuan . Julius Baer empieza a transferir el negocio de Merrill Lynch IWM en Hong Kong y Singapur
Julius Baer announces that, in line with its original integration plans, the transfer of the Hong Kong and Singapore businesses of Merrill Lynch’s International Wealth Management (IWM) started this monday. This step represents another major milestone in the two-year integration process and will elevate Julius Baer into the leading group of international private banks in its second home market Asia.
The transfer of the businesses in Hong Kong and Singapore to Julius Baer’s existing entities is expected to double the Bank’s assets under management in Asia, thereby significantly strengthening Julius Baer’s already strong position in this important growth region.
Boris F.J. Collardi, Chief Executive Officer of Julius Baer Group, said: “Representing more than a third of IWM’s entire business in scope, the integration of the Hong Kong and Singapore businesses is a crucial part of the transaction. After the integration about a quarter of our total assets will be managed in Asia and it will make us one of the largest international wealth management players in our second home market. The transfer will double the number of our local employees. With this considerable reinforcement we have created excellent preconditions for further dynamic growth in this very important market in the years to come.”
Dr. Thomas R. Meier, Head Asia of Bank Julius Baer, added: “I very much look forward to welcoming the new colleagues and clients. The teams on both sides have already worked together very closely over the last few months to ensure that the transition will continue to proceed as planned. By combining the unique strengths and histories of both banks we will be able to provide an even better and more comprehensive service to clients in this region.”
IWM’s financial advisers, their client relationships and related assets under management of the respective businesses will be transferred to the Julius Baer platforms in stages and in line with applicable regulations in the two jurisdictions. The process in Asia is expected to be completed in the first quarter of 2014.
In Hong Kong, Bank Julius Baer will eventually move its newly combined business into One International Finance Centre, 1 Harbour View Street as its new prime location. In Singapore, Bank Julius Baer will continue to operate out of its existing premises at Asia Square and add an office at Mapletree Business City. Singapore will remain Julius Baer’s IT and operations hub for Asia.
Other major businesses adding further scale to follow shortly
As previously communicated, since the Principal Closing of the transaction last February already CHF 24 billion of IWM’s assets under management have been reported by the end of April 2013. The next businesses to transfer, expected to occur during the coming summer months, are in the UK, Spain and Israel, which will add substantial scale to Julius Baer’s global network, especially in the UK. The preparations for these transfers are well under way.
IWM is an excellent strategic fit for Julius Baer, strengthening the Group’s presence in key growth markets around the globe and significantly enlarging its asset base. The integration phase which was launched in February 2013 is expected to be completed in the first quarter of 2015, with the large majority of the assets under management targeted to be transferred in 2013.
Foto: Holiday Inn Express. Fibra Inn anuncia la adquisición de hoteles en Guadalajara y Playa del Carmen
Deutsche Bank Mexico, S.A., Banking institution, Trust Division F/1616 or Fibra Inn, a Mexican real estate investment trust specializing in the hotel industry serving the business traveler, announced that it has completed the acquisition of the Holiday Inn Express Guadalajara UAG hotel.
Fibra Inn paid Ps. 186.9 million for this hotel, excluding taxes and acquisition expenses, and the adjoining land where the Company is planning a room expansion. The property was paid in cash and it is the first hotel acquisition purchased with the proceeds from the initial public offering that took place on March 13, 2013. Furthermore, this hotel is part of the Acquisition Portfolio, which will include the purchase of five additional properties as part of the Initial Portfolio.
“This first acquisition represents a high-quality investment for the Company and one that will generate value for shareholders. As we mentioned during the IPO process, the Company is committed to disciplined growth for the Fibra, employing a long-term vision.”
The Holiday Inn Express Guadalajara UAG Hotel is a high potential property with 100 rooms; Fibra Inn expects to add 99 rooms, which will be operating by the first quarter of 2014. This property is located at close proximity to Plaza Andares, the Universityof Guadalajara, the Belenes Industrial Park, and is located a few Kilometers from Pemex’s offices.
Operadora de Comercios de Vallarta, S.A de C.V. will be the hotel operator of this hotel. During 2012, the occupancy rate was 65%, the average room rate was Ps. 1,142 and the RevPar was Ps.737.
Mr. Victor Zorrilla, President and Chief Executive Officer stated: “This first acquisition represents a high-quality investment for the Company and one that will generate value for shareholders. As we mentioned during the IPO process, the Company is committed to disciplined growth for the Fibra, employing a long-term vision.”
