LI KA-SHING, East Asia’s richest man with a net worth of 26 bln usd, had a red-letter first half, with two conglomerates he chairs – Hutchison Whampoa and Cheung Kong Holdings – seeing their bottom lines shoot up by around sixfold and twofold, respectively.
And despite the lingering slowdown overseas, this property and telecom tycoon is extremely bullish on prospects in Hong Kong’s mighty neighbor to the north.
Li’s telecommunications behemoth – Hutchison Whampoa (HK: 13) -- saw first-half net profit jump more than six times to a jaw dropping 46.3 bln hkd, while property giant Cheung Kong (HK: 1) jumped 169% to 33.3 bln hkd.
A Chinese language piece in Sinafinance cited the man once named “Asia’s Most Powerful Man” by Asiaweek as saying that he saw Mainland China as a major engine of growth for business going forward, especially as North America and the EU struggle to get their financial houses in order.
And Mr. Li should know a thing or two about regional potential, as his broad range of companies comprise a staggering 15% of the total market capitalization of the Hong Kong Stock Exchange.
Li, who received the inaugural “Malcolm S. Forbes Lifetime Achievement Award five years ago in Singapore, recently said: “The current global economic situation is still fraught with uncertainties and pitfalls, but I am very optimistic about the development of the Mainland Chinese market.”
But the financial struggles overseas did not prevent the many enterprises under Mr. Li’s massive umbrella from enjoying a robust first six months.
Hutchison Port Holdings Trust, which owns port assets in Hong Kong and Mainland China from Li's Hutchison Whampoa Ltd, listed in Singapore in March.
Shares initially had the misfortune of listing shortly after the catastrophic earthquake and tsunami in Japan, which resulted in a near 6% opening trading day drop.
Since then, the valuation has failed to take off and shares are trading near post-listing lows of 0.70 sgd.
However, the Singapore-listed trust along with Hong Kong-listed Huixian Trust both recently reported upbeat first half earnings which helped boost Mr. Li’s fortunes considerably.
Mr. Li, in typically understated fashion, said he was “satisfied” with the first half performance of his many enterprises, adding he was especially pleased with Hutchison Whampoa’s interim results.
However, he was fully aware that not all corners of the world had it as good as Hong Kong and Greater China in general.
He pointed out that the present global economy still was burdened with many uncertainties, such as Europe's debt problems and joblessness in the US, and recoveries in both major market are not yet gaining any recognizable traction.
Therefore, Mr. Li said his Groups’ future growth must take these pitfalls into consideration when planning expansion strategies.
However, Mainland China was a completely different story for the richest of the rich among Hong Kong's tycoons.
“I don’t think that the seemingly endless series of interest rate hikes and monetary adjustments in the PRC will result in a hard landing there. Despite the credit tightening moves slowing our Mainland China sales somewhat, I am still optimistic about our companies’ development in the PRC market.”
Time will only tell if Mr. Li’s dreams of making it even bigger in the world’s second biggest market will become reality.
But the 83-year old magnate has been atop of the business pyramid for decades, so he certainly knows a thing or two about long-term strategy and biding one’s time.
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