In a Major Shift, Equities Replace Debt as Favorite of Asian Investors
Spurred by a run of initial public offerings from China and renewed confidence in Asia's economic stability, equities have replaced debt as the investment and financing means of choice in the region.
It's a dramatic change in investor sentiment. Through most of 2003, jittery investors -- spooked by the war in Iraq and the outbreak of severe acute respiratory syndrome -- fled equities in favor of debt, propelling corporate- and government-debt issuance in Asia excluding Japan to a record US$33.38 billion last year, up 55% from US$21.52 billion in 2002. (The figures were boosted by US$9.5 billion of bonds issued by Hong Kong-based holding company Hutchison Whampoa Ltd.)
However, equities staged an impressive comeback in last year's fourth quarter as a faster-than-expected recovery from SARS enhanced corporate confidence in the region and led to an increase in stock offerings. In the fourth quarter, the Hong Kong IPO of PICC Property & Casualty Co., a unit of People's Insurance Co. of China, raised US$800 million in Hong Kong, while the December IPO of China Life Insurance Co. in New York and Hong Kong raised US$3.46 billion -- making it the world's biggest IPO in 2003.
That momentum continued through the first three months of this year, propelling equity issues in the recently completed first quarter to a record US$19.24 billion, data from financial information provider Thomson Financial shows. Many investment bankers are optimistically forecasting that equity capital raised in Asia this year outside Japan could surpass the record US$40 billion set in 2000 during the peak of the technology-stock craze. Some bankers are even forecasting equity issuance of US$60 billion or more in Asia this year.
"Asia is undergoing a real renaissance in equities, and running at record levels," says David Hancock, co-head of institutional equities in Asia-Pacific at J.P. Morgan Securities Ltd. in Hong Kong.
Not that the debt markets have died. In fact, debt issues also had an impressive first quarter. The question is whether that strength will last. "There is a big risk that debt issues will taper off as the year progresses," says Marc Jones, head of debt capital markets at J.P. Morgan in Hong Kong.
Mr. Jones expects the U.S. Federal Reserve to raise interest rates this summer, and that other countries will follow, ending the current historically low rates globally. Also, many companies borrowed in the first quarter against the rest of this year and are unlikely to tap the debt markets again. Plus, retail investors are switching to equities and cash from fixed-income vehicles; several planned sovereign-bond issues may be delayed by coming elections, such as in the Philippines; and there are unlikely to be any big corporate-bond issues of the size done last year by Hutchison Whampoa. "I fear the strength we saw in the first quarter may not continue," he says.
While elections region-wide are proving to be a wild card for deals of all kinds this year, several countries are planning sovereign-bond issues. The most eagerly anticipated offering is by the Hong Kong government, which is preparing a HK$20 billion (US$2.6 billion) bond issue, to be done over several tranches.
China and South Korea are also planning sovereign issues, each of which is likely to be US$1 billion to US$2 billion, say bankers. And the Philippines and Thailand may also tap the debt markets later this year with US$1 billion bond issues each. Indonesia's government recently successfully issued a US$1 billion 10-year bond, the first time it has done a sovereign-bond offering since the 1997-98 financial crisis.
However, even those hefty sovereign-bond issues will be dwarfed in size by the IPOs planned for this year, in particular by multibillion-dollar issues in the pipeline from China. Merrill Lynch & Co. forecasts that China IPOs will total US$15 billion this year, more than double the value of issues last year. Chinese IPOs expected to hit the Hong Kong stock exchange over the summer include a US$2 billion issue from coal company Shen Hua Group, a US$2 billion offering from China Netcom Corp., a big fixed-line phone operator, and a US$2 billion IPO by Ping An Insurance Co., one of China's largest insurers.
Smaller planned IPOs include a US$1 billion issue by China Shipping Container Lines Co., a unit of China Shipping (Group) Co., and an US$800 million offering by China Power International Holding. The blockbuster IPO this year may be the US$5 billion IPO in New York and Hong Kong of China Construction Bank, one of the country's four massive state-owned lenders. However, several bankers say it may take until 2005 for China Construction Bank to finalize its IPO.
Other countries have big issuance plans as well. Bankers say government privatizations in the region will spur IPOs valued at US$300 million or more in several parts of Asia, including Hong Kong, Singapore, Korea, Thailand, Indonesia and India.
Bankers acknowledge that there has been a downturn in investor enthusiasm for overseas IPOs of Chinese companies, and say they will have to do more to ensure that corporations coming to market from China avoid scandals and are appropriately priced. The US$3.46 billion IPO in New York and Hong Kong last December of China Life Insurance marked a high point in a frenzy over China investments that carried over into January and February, with the retail portion of some IPOs in Hong Kong more than 1,000 times subscribed. However, retail investors have since backed off and the share prices of some China plays have actually fallen on their debuts on the Hong Kong stock exchange.
Yet bankers insist that institutional investors remain focused on the huge growth potential of China's economy, and that retail investors will regain their enthusiasm for China as big share debuts come to market.
"People will be a lot more selective on China now," says Charles Li, chief executive of J.P. Morgan China. "But you can't expect that every IPO is going to go up 20% or 30%," he adds. "Nothing has fundamentally changed in China. I think equity issuance will continue to dominate in China."
While mergers and acquisitions are up this year from the doldrums they languished in last year during the SARS outbreak, the level of activity is still not as high as many bankers forecast in December.
"There are a finite number of companies in this region that can do deals of a certain size," says one senior banker in Hong Kong.
However, the year so far hasn't been a total disappointment. Citigroup Inc.'s US$2.71 billion acquisition of South Korean lender KorAm Bank created a lot of enthusiasm in the industry, say bankers. And many bankers say there are now a lot more discussions going on about possible mergers and acquisitions than a year ago.
"The first half of last year the dialogue was missing. Few companies were contemplating doing deals," says Gokul Laroia, head of M&A for Asia Pacific at Morgan Stanley.
Bankers say they are optimistic that consolidation will happen in several sectors across several markets around the region this year. In particular, bankers forecast consolidation in Taiwan's and Hong Kong's financial-services sector, as well as in Korea's telecommunications industry and in India's automotive-parts and steel sectors.
There is also an expectation of more cross-border M&A deals, particularly between Chinese companies and companies from the West. "Last year I had seven deals in the pipeline in China, one of them a Western cross-border deal," says Todd Marin, co-head of investment banking in Asia at J.P. Morgan in Hong Kong. "Today, I have 12 deals in the China pipeline, seven of them Western cross-borders."
With corporate confidence continuing to grow in the region, the level of M&A activity is expected to pick up as the year progresses, and bankers say they expect the total value of deals in Asia, excluding Japan, will surpass the US$102.6 billion reached last year -- which was down 22% from US$130.9 billion in 2002, according to financial-data provider Dealogic.
Risks remain. Terrorism, corporate scandals, political turmoil, a downturn in the U.S. recovery or an escalation of the violence in Iraq could all damage the outlook and business sentiment across Asia. "It's a volatile region. Things can change, and change quickly," says Morgan Stanley's Mr. Laroia.
Yet most bankers say they feel confident. "Things feel better now than they have in a long time," says Marshall Nicholson, head of equity capital markets for non-Japan Asia at Credit Suisse First Boston in Hong Kong.
亚洲投资者股市兴趣要大于债市
受到中国公司一系列首次公开募股(IPO)的刺激，同时也是因为投资者对亚洲的经济稳定恢复了信心，股票已经取代债券成为了亚洲地区首选的投资和融资方式。
这是投资人气的一次戏剧性转变。在2003年的大部分时间内，因伊拉克战争和非典型肺炎(SARS)爆发而惊慌失措的投资者纷纷逃离股市而涌向债市，导致去年亚洲除日本外地区的企业和政府债券发行额达到了创纪录的333.8亿美元，较2002年时的215.2亿美元增加了55%。（香港的和记黄埔(Hutchison Whampoa Ltd.)发债95亿美元对此居功至伟）。
不过，股市去年第四季度却实现了令人瞩目的回升，原因是亚洲经济在SARS疫情过后恢复的速度快于预期，这提高了企业对亚洲的信心，并导致股票发行交易的增加。去年第四季度，中国人民保险公司(People's Insurance Co.)的旗下子公司中国人民财产保险股份有限公司(PICC Property & Casualty Co.)在香港的IPO就募集了8亿美元资金，而中国人寿保险股份有限公司(China Life Insurance Co.)去年12月份在香港和纽约进行的IPO则募集了34.6亿美元资金，成为2003年全球规模最大的IPO。
股市融资的这股上涨势头延续到了今年前三个月，据金融信息提供商Thomson Financial发布的数据，今年第一季度的股市融资额达到了创纪录的192.4亿美元。许多投资银行家都乐观地预测，今年除日本外亚洲地区的股市融资额有可能超过2000年时创纪录的400亿美元，那一年正是科技股狂潮发展到顶峰的时候。一些银行家甚至预计，亚洲地区今年的股票发行额将达到600亿美元以上。
JP摩根证券(J.P. Morgan Securities Ltd.)驻香港的亚太区机构证券联席主管大卫?汉考克(David Hancock)说，亚洲地区的股市正在经历一场真正意义上的复兴，增长速度之快达到了创纪录的水平。
但这并不意味著债券市场已经陷入沉寂。事实上，今年第一季度的债券发行规模仍然令人印象深刻。问题是这一强劲势头是否能够维持下去。JP摩根(J.P. Morgan)驻香港的债务资本市场主管马可?琼斯(Marc Jones)说，债券发行业务今年很可能随著时间的推进而递减。
琼斯预计美国联邦储备委员会(Federal Reserve)今年夏季将上调利率，而其他国家也将跟进，从而结束世界各国利率普遍处于历史低点这一局面。此外，许多公司今年第一季度发债是为了满足全年之需，因此今年余下时间它们可能不会再涉足债券市场了。另一方面，散户投资者也正将手中的固定收入产品套现，转而投资股票；而菲律宾等国则可能因为大选临近而推迟主权债券发行；而且，今年也不大可能有像和记黄埔去年那样大规模的公司债券发行了。琼斯说，债券市场今年第一季度的强劲势头可能无法持续下去。 今年是亚洲许多国家的大选年，这对今年发行的各类债券看来都是一个不确定因素，不过仍有几个国家或地区计划发行主权债券。市场最为期待的是香港政府发行的债券，港府计划发行价值200亿港元的债券(合26亿美元)，这笔债券将分为几种不同的类型发行。
中国和韩国也计划发行主权债券，银行家们说，两国的债券发行规模预计都在10亿至20亿美元之间。菲律宾和泰国今年晚些时候也有可能涉足债券市场，各发行10亿美元的主权债券。印尼政府最近成功发行了一笔10亿美元的10年期债券，这是它自1997-98年金融危机以来首次发行主权债券。
然而，较之于今年计划中的IPO规模(特别是中国公司多起数十亿美元的股票发行计划)，即使上述这些规模不菲的主权债券发行规模也会相形见绌。美林公司(Merrill Lynch & Co.)预计，中国企业今年的IPO总额将达到150亿美元，超过去年的股票发行额一倍以上。今年夏季将在香港进行首次公开募股的中国大陆企业预计会有煤炭企业神华集团(Shen Hua Group)，股票发行规模20亿美元；大型固定电话运营商中国网络通信有限公司(China Netcom Corp.)，发行规模20亿美元；以及中国最大的保险公司之一平安保险(Ping An Insurance Co.)，股票发行规模20亿美元。
其他规模较小的拟议中IPO还包括：中国海运(集团)总公司(China Shipping (Group) Co.)的子公司中海集装箱运输有限公司(China Shipping Container Lines Co.)计划发行价值10亿美元的股票，中国电力国际(China Power International Holding)拟发行8亿美元的股票。今年规模最大的IPO可能是中国四大国有银行之一中国建设银行(China Construction Bank)计划在纽约和香港发行的50亿美元股票。不过也有一些银行家认为，中国建设银行的IPO可能要到2005年才能最终实施。
其他国家和地区也有大规模的股票发行计划。银行家们说，香港、新加坡、韩国、泰国、印尼和印度等国家和地区政府的私有化计划将刺激规模在3亿美元或者更高的IPO数量。
银行家们承认，投资者对中国大陆公司海外IPO的热情已有减弱。他们说，要避免中国大陆来海外上市的公司出现会计丑闻，并且使这些公司拟发行的股票被合理定价，他们还需要做更多的工作。中国人寿保险股份有限公司去年12月在纽约和香港成功发行34.6亿美元股票可以被视为最近一轮投资中国热的高潮，而且这一热潮一直延续到了今年一二月份。在香港市场，一些中国公司IPO面向散户发售的部分获得了1,000多倍的认购。但此后，散户投资者对中国大陆股票的兴趣已有减弱，在香港交易所，一些中国大陆公司的股票在上市首日实际上还下跌了。
但银行家们坚持说，机构投资者仍然看重中国经济的巨大增长机会，而当再有中国大陆公司在海外大规模发行股票时，散户投资者对中国的兴趣将会重燃。
JP摩根中国业务(J.P. Morgan China)的首席执行长查尔斯?李(Charles Li)说，人们现在投资中国大陆股票时要挑剔得多了。但他也说，不能指望每一只IPO股票都能上涨20%或30%。他认为中国经济的基本面没有改变，中国公司将继续主导股票发行市场。
与去年SARS爆发期间萎靡不振的状况相比，企业并购业务今年虽已升温，但繁荣程度仍无法达到许多银行家去年12月份时的预期。
香港的一位资深银行家说，亚洲能够进行有一定规模并购交易的企业不多。
不过，今年迄今为止这方面的市场表现并非完全令人失望。投资银行人士说，花旗集团(Citigroup Inc.)斥资27.1亿美元收购韩国借款银行KorAm Bank就在业内掀起了波澜。许多银行家都说，目前正在洽谈著的合并交易要多于去年同期。
摩根士丹利(Morgan Stanley)亚太并购业务的主管高浩澧(Gokul Laroia)说，去年上半年根本就没有人在商谈并购交易，当时也没有什么公司有意达成这类交易。 银行家们乐观地认为，今年亚洲一些市场的某些领域将发生行业整合。他们预计，台湾和香港的金融服务领域、韩国的电信业以及印度的汽车零部件和钢铁业最有可能出现行业整合。
跨国并购交易的数量也有望增加，中国和西方公司之间尤其有可能发生这类交易。JP摩根驻香港的亚洲区投资银行业务联席主管马宏涛(Todd Marin)说，去年他在中国大陆接手的并购业务有7起，其中有一起是西方公司的跨国并购。而目前他接手的中国大陆企业并购交易有12起，其中的7起是西方公司的跨国并购。
随著亚洲地区的企业信心继续增强，预计随著时间的推移，亚洲地区今年的并购活动也将提升到新的水平，银行家们预计，日本以外亚洲地区今年的并购交易总额将超过1,020亿美元这一去年达到的水平。金融数据提供商Dealogic公布的数据显示，去年的并购交易额较2002年的1,309亿美元下降了22%。
不过市场风险依然存在。恐怖主义威胁、企业丑闻、政治动乱、美国经济复苏势头减弱以及伊拉克的混乱局面加剧，无论哪方面出现问题，都有可能损害亚洲的经济前景和商业人气。摩根士丹利的高浩澧说，亚洲是个极易发生变化的地区，而且变化发生的速度会很快。
但多数银行家都说他们对亚洲有信心。瑞士信贷第一波士顿(Credit Suisse First Boston)驻香港的日本以外亚洲区股票资本市场业务的主管马歇尔?尼科尔森(Marshall Nicholson)说，亚洲地区目前的形势较以往很长一段时间都要好。
