Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
  1. Homepage
  2. Equities
  3. Hong Kong
  4. Hong Kong Stock Exchange
  5. China Unicom (Hong Kong) Limited
  6. News
  7. Summary
    762   HK0000049939

CHINA UNICOM (HONG KONG) LIMITED

(762)
  Report
SummaryChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

Analysis: Sanctions-hit Chinese firms surge as global buyers swoop in

01/14/2021 | 04:42am EDT
FILE PHOTO: FILE PHOTO: The company logo of China Telecom is displayed at a news conference in Hong Kong

SHANGHAI/SINGAPORE (Reuters) - Asian and European investors are snatching up discounted Chinese stocks hit by a U.S. investment ban, finding bargains as giant American funds bail out and shrugging off concerns that the sanctions could hurt the companies' prospects.

Swiss investment bank UBS said clients were interested in taking advantage of the selldown. In a week that saw Vanguard and BlackRock announce divestments, cash has poured in to lift Hong Kong-listed shares of Chinese telecoms by more than 15%.

China Mobile is heading for its best week in nearly 12 years. State-owned oil company CNOOC Ltd is up 16% and chipmaker SMIC 10%. All three are subject to the sanctions and have been, or risk being, removed from global indexes.

The flows and price moves point to deep faith abroad and especially at home in the worth of the 35 Chinese companies, and subsidiaries, that Americans are barred from holding after November 2021. It also raises questions over how painful the sanctions will prove.

"I think it's worth monitoring the market closely these days because there will be forced liquidations triggered," said UBS' head of China strategy Wendy Liu. "We do have European investors interested in stocks blacklisted by the U.S."

U.S. funds are scrambling to sell following a November order from President Donald Trump banning buying companies deemed to have links with China's military. He clarified on Wednesday that the ban extends to owning the stocks.

Passive investors are also responding to the removal of more than a dozen companies from benchmarks compiled by MSCI, FTSE Russell and S&P Dow Jones Indices.

Vanguard and BlackRock have given few details of their divestments and have not detailed exactly which stocks they have sold. Vanguard has said it has sold to comply with the rules and BlackRock said its index funds have responded to index changes.

"Opportunity exists now," said portfolio manager Dave Wang at Singapore's Nuvest Capital, which has increased exposure to state-owned firms in the construction and energy sectors in China since the U.S. sanctions were announced.

"Profit outlook is trending upwards, while valuation has been depressed and lots of pessimism is priced in due to the (U.S.) list."

HOME BUYERS

Support for the sanctioned companies seems to run strongest in China, where brokers have issued buy recommendations and some retail investors mentioned patriotism along with profit as their motive for buying.

Ding Ning, a retail investor on investment website Xueqiu.com, estimates China Mobile already offers a good dividend and "if you take into account the potential valuation repairment, supporting share prices for the country would generate handsome returns".

Cash flows into Hong Kong from the mainland hit record levels this week as Chinese investors snapped up sanctioned companies listed there.

Holdings by mainland Chinese in China Mobile, China Unicom, China Railway Construction Corp and CNOOC have more than tripled since the companies fell under the remit of sanctions, among other heavy inflows to affected stocks.

But though the stocks have rallied, prices are still lower than before the companies were sanctioned, and they face months more of selling as well as loss of access to the world's deepest pool of capital. There is also a lot of uncertainty around the details of the rules.

But U.S. fund managers say investors are taking no chances.

"The prevalence of U.S. firms all along the financial supply chain means that liquidity will dry up," said David Loevinger, California-based managing director at asset manager TCW's emerging markets group.

"This is forcing investors to sell now while they still can."

And that means picking their moment before November to part with the sanctioned sections of their exposure to the world's best-performing big economy.

"I think the fundamentals don't change. They're still sound," said Paul Sandhu, head of multi-asset quant solutions in Asia at France's BNP Paribas Asset Management. "The burden of these sanctions has really fallen on U.S. investors."

(Additional reporting by Gaurav Dogra in Bengaluru and Rodrigo Campos in New York; Editing by Vidya Ranganathan and Jacqueline Wong)

By Samuel Shen and Tom Westbrook


ę Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
BLACKROCK, INC. 1.52% 880.66 Delayed Quote.22.05%
CHINA MOBILE LIMITED -0.31% 48.6 End-of-day quote.9.95%
CHINA RAILWAY CONSTRUCTION CORPORATION LIMITED 0.27% 7.56 End-of-day quote.-4.30%
CHINA RAILWAY GROUP LIMITED 0.38% 5.32 End-of-day quote.0.95%
CHINA UNICOM (HONG KONG) LIMITED -0.47% 4.25 End-of-day quote.-4.49%
CNOOC LIMITED 1.33% 9.14 End-of-day quote.27.30%
HANDSOME CORP. -0.68% 43500 End-of-day quote.43.80%
LONDON BRENT OIL 0.38% 73.01 Delayed Quote.40.00%
SEMICONDUCTOR MANUFACTURING INTERNATIONAL CORPORATION -0.83% 23.8 End-of-day quote.7.69%
UBS GROUP AG 0.21% 14.58 Delayed Quote.16.92%
WTI 0.42% 71.231 Delayed Quote.45.60%
All news about CHINA UNICOM (HONG KONG) LIMITED
06/03Factbox-U.S. Treasury updates list of Chinese entities hit by investment ban
RE
05/30China Unicom Files for Deregistration of ADS, Termination of Reporting Obliga..
MT
05/25China's Telecom Operators Make Progress in Expanding 5G Mobile Network
MT
05/23Hang Seng Index to Add Xinyi Solar, BYD, Country Garden as Constituents Under..
MT
05/21CHINA UNICOM HONG KONGá : Mobile Phone Subscribers Rise in April to Over 300 Mil..
MT
05/20CHINA UNICOM (HONG KONG) LIMITED : Ex-dividend day for final dividend
FA
05/18China Mobile Turns to Shanghai Exchange as New York Listing Door Closes
MT
05/17China Mobile Proposes Mainland IPO After NYSE Delisting
MT
05/17China Mobile eyes $6 billion Shanghai listing after flagging NYSE exit
RE
05/13CHINA UNICOM HONG KONGá : Poll Results of Annual General Meeting and Payment of ..
PU
More news
Financials
Sales 2021 319 B 49 813 M 49 813 M
Net income 2021 14 249 M 2 227 M 2 227 M
Net cash 2021 32 380 M 5 060 M 5 060 M
P/E ratio 2021 7,52x
Yield 2021 5,29%
Capitalization 107 B 16 757 M 16 751 M
EV / Sales 2021 0,23x
EV / Sales 2022 0,21x
Nbr of Employees 242 121
Free-Float 20,1%
Chart CHINA UNICOM (HONG KONG) LIMITED
Duration : Period :
China Unicom (Hong Kong) Limited Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends CHINA UNICOM (HONG KONG) LIMITED
Short TermMid-TermLong Term
TrendsBearishBearishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 22
Average target price 5,87 CNY
Last Close Price 3,50 CNY
Spread / Highest target 160%
Spread / Average Target 67,4%
Spread / Lowest Target 4,85%
EPS Revisions
Managers and Directors
NameTitle
Xiao Chu Wang Chairman & Chief Executive Officer
Zhong Yue Chen President & Executive Director
Ke Bing Zhu Chief Financial Officer & Executive Director
Shui Ming Chung Independent Non-Executive Director
Wing Lam Cheung Independent Non-Executive Director
Sector and Competitors
1st jan.Capitalization (M$)
CHINA UNICOM (HONG KONG) LIMITED-4.49%16 757
AT&T INC.1.95%209 345
T-MOBILE US7.79%181 231
SOFTBANK GROUP CORP.-0.72%124 813
KDDI CORPORATION18.07%74 431
AMÉRICA MÓVIL, S.A.B. DE C.V.12.08%53 965