HONG KONG: The oracle of Hong Kong has spoken. His message: It is time to consider buying stocks and real estate.
The proclamation Thursday by Li Ka-shing, the self-made billionaire who controls some of the largest Hong Kong companies and carries enormous sway with Asian investors, was made at one of his rare public appearances.
Exuding confidence, Mr. Li joked with reporters and looked anything but depressed about the sharp drop in profit his companies reported Thursday.
Whether Mr. Li is proved right about stocks and property — and he certainly has a lot to gain if he is right — his comments come at a time when stock markets have rallied on hopes that the economic slump is bottoming out.
“If you have money in your pocket,” Mr. Li said, consider buying into stocks. As for the property market in Hong Kong, he said, “history tells us that if you buy in a slow market, in the medium term you get good returns.”
Mr. Li repeatedly declined to say whether he thought the stock market had reached bottom. And he advised against borrowing to invest in what remains a shaky and volatile environment.
Even though they were couched with caution, Mr. Li’s comments echoed around the investment world and helped send the Hang Seng index in Hong Kong up 3.6 percent Thursday.
Mr. Li is the man the local media dub “superman” and is likened to the American investor Warren Buffett. Mr. Li, considered one of Asia’s most powerful men, is also one of the continent’s most generous philanthropists.
Over the past year, as the economic crisis deepened, Mr. Li has jumped in from time to time to try to restore confidence. Thursday was the latest example of that.
In September, shortly after the collapse of Lehman Brothers had caused the world’s financial system to convulse, people with savings accounts lined up in Hong Kong outside the Bank of East Asia, one of the best-known and biggest banks in the city, amid rumors that the bank was in trouble.
Mr. Li let it be known that he had been buying shares in the bank, an expression of confidence that quickly helped put an end to an old-fashioned bank run.
And this month, HSBC was trying to raise $18 billion in a share offering, causing the bank’s shares to fall. Many local residents own shares in the bank, which now has its headquarters in Britain but has its roots in Hong Kong.
When it appeared that the share offering might falter, Mr. Li, along with several other Hong Kong investors, pledged to put about $300 million into the offering to help get it off the ground.
Still, it has been a difficult year for Mr. Li, and the title of “superman” sat a little awkwardly on him Thursday after Cheung Kong Holdings and Hutchison Whampoa, the flagship companies of the conglomerate he controls, both reported declines in net profit of more than 40 percent for 2008.
The rapid slowdown in the global economy has tipped Hong Kong, along with the United States, Japan and other countries, into a painful recession and put a damper on the breakneck growth in mainland China.
Rental and property prices in Hong Kong, a mainstay of the conglomerate’s earnings, are expected to fall more this year, hitting developers hard.
But the Cheung Kong group is not just any Hong Kong company, and Mr. Li is not just any Hong Kong chairman.
The event Thursday was not just any annual news conference, but the pinnacle of the Hong Kong earnings season, complete with a boisterous and noisy media crowd that made Mr. Li seem like a pop star.
The complex network of companies Mr. Li controls — three of them are listed on Hong Kong’s benchmark Hang Seng index — epitomize the hustle and bustle of Hong Kong and its roller-coaster economy.
And Mr. Li has the kind of rags to riches history that many in Hong Kong dream about.
The Cheung Kong group and its various interlinked companies grew out of the humble beginnings: a plastic-flower manufacturing business Mr. Li set up in the 1950s. Through them, five decades later, Mr. Li is one of Hong Kong’s leading developers of residential, commercial and industrial properties.
About one in seven private residences here was developed by the group.
Hutchison Whampoa, where Mr. Li also is chairman, operates ports, hotels and supermarket and drugstore chains and is a major telecommunications operator in Hong Kong and abroad.
Cheung Kong Infrastructure, run by Mr. Li’s son, Victor, and HK Electric, one of the city’s dominant power companies, also belong to the Cheung Kong/Hutchison stable of businesses.
Together, the businesses are a cross-section of Hong Kong’s economy, and they reflect more than any other company the city’s boom-to-bust character, riding the wave of Asia’s breakneck growth in recent years and now suffering with the slowing global economy.
Likewise, no one could be more typical than Mr. Li of Hong Kong’s business scene, which is dominated by a handfuls of super-rich and super-influential investors, many of them in their 70’s or 80’s and many of them entrepreneurs who made their fortunes in the city after fleeing mainland China.
Mr. Li moved to Hong Kong during World War II and built up what is now Hong Kong’s biggest fortune.
1 comment:
It’s time to buy, the oracle of Hong Kong says
By Bettina Wassener
26 March 2009
HONG KONG: The oracle of Hong Kong has spoken. His message: It is time to consider buying stocks and real estate.
The proclamation Thursday by Li Ka-shing, the self-made billionaire who controls some of the largest Hong Kong companies and carries enormous sway with Asian investors, was made at one of his rare public appearances.
Exuding confidence, Mr. Li joked with reporters and looked anything but depressed about the sharp drop in profit his companies reported Thursday.
Whether Mr. Li is proved right about stocks and property — and he certainly has a lot to gain if he is right — his comments come at a time when stock markets have rallied on hopes that the economic slump is bottoming out.
“If you have money in your pocket,” Mr. Li said, consider buying into stocks. As for the property market in Hong Kong, he said, “history tells us that if you buy in a slow market, in the medium term you get good returns.”
Mr. Li repeatedly declined to say whether he thought the stock market had reached bottom. And he advised against borrowing to invest in what remains a shaky and volatile environment.
Even though they were couched with caution, Mr. Li’s comments echoed around the investment world and helped send the Hang Seng index in Hong Kong up 3.6 percent Thursday.
Mr. Li is the man the local media dub “superman” and is likened to the American investor Warren Buffett. Mr. Li, considered one of Asia’s most powerful men, is also one of the continent’s most generous philanthropists.
Over the past year, as the economic crisis deepened, Mr. Li has jumped in from time to time to try to restore confidence. Thursday was the latest example of that.
In September, shortly after the collapse of Lehman Brothers had caused the world’s financial system to convulse, people with savings accounts lined up in Hong Kong outside the Bank of East Asia, one of the best-known and biggest banks in the city, amid rumors that the bank was in trouble.
Mr. Li let it be known that he had been buying shares in the bank, an expression of confidence that quickly helped put an end to an old-fashioned bank run.
And this month, HSBC was trying to raise $18 billion in a share offering, causing the bank’s shares to fall. Many local residents own shares in the bank, which now has its headquarters in Britain but has its roots in Hong Kong.
When it appeared that the share offering might falter, Mr. Li, along with several other Hong Kong investors, pledged to put about $300 million into the offering to help get it off the ground.
Still, it has been a difficult year for Mr. Li, and the title of “superman” sat a little awkwardly on him Thursday after Cheung Kong Holdings and Hutchison Whampoa, the flagship companies of the conglomerate he controls, both reported declines in net profit of more than 40 percent for 2008.
The rapid slowdown in the global economy has tipped Hong Kong, along with the United States, Japan and other countries, into a painful recession and put a damper on the breakneck growth in mainland China.
Rental and property prices in Hong Kong, a mainstay of the conglomerate’s earnings, are expected to fall more this year, hitting developers hard.
But the Cheung Kong group is not just any Hong Kong company, and Mr. Li is not just any Hong Kong chairman.
The event Thursday was not just any annual news conference, but the pinnacle of the Hong Kong earnings season, complete with a boisterous and noisy media crowd that made Mr. Li seem like a pop star.
The complex network of companies Mr. Li controls — three of them are listed on Hong Kong’s benchmark Hang Seng index — epitomize the hustle and bustle of Hong Kong and its roller-coaster economy.
And Mr. Li has the kind of rags to riches history that many in Hong Kong dream about.
The Cheung Kong group and its various interlinked companies grew out of the humble beginnings: a plastic-flower manufacturing business Mr. Li set up in the 1950s. Through them, five decades later, Mr. Li is one of Hong Kong’s leading developers of residential, commercial and industrial properties.
About one in seven private residences here was developed by the group.
Hutchison Whampoa, where Mr. Li also is chairman, operates ports, hotels and supermarket and drugstore chains and is a major telecommunications operator in Hong Kong and abroad.
Cheung Kong Infrastructure, run by Mr. Li’s son, Victor, and HK Electric, one of the city’s dominant power companies, also belong to the Cheung Kong/Hutchison stable of businesses.
Together, the businesses are a cross-section of Hong Kong’s economy, and they reflect more than any other company the city’s boom-to-bust character, riding the wave of Asia’s breakneck growth in recent years and now suffering with the slowing global economy.
Likewise, no one could be more typical than Mr. Li of Hong Kong’s business scene, which is dominated by a handfuls of super-rich and super-influential investors, many of them in their 70’s or 80’s and many of them entrepreneurs who made their fortunes in the city after fleeing mainland China.
Mr. Li moved to Hong Kong during World War II and built up what is now Hong Kong’s biggest fortune.
Jaymee Ng contributed reporting.
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