Latest news with #NanshanGroup
Zawya
6 days ago
- Business
- Zawya
Shanghai bourse gives bond investors a taste of high yields with new framework, sources say
The Shanghai Stock Exchange plans to facilitate more companies to issue bonds and attract investors with a new framework for such issuances, two sources said, as China looks to boost funding options for the private sector to revive its economy. Fifty-three bonds worth 37 billion yuan ($5.2 billion) have been sold so far under the new mechanism, which was launched quietly as a pilot late last year, said the sources with direct knowledge of the exchange's scheme. The deals were made possible after the companies under the new framework, which excludes developers and financial firms, were required to make more timely disclosures about businesses, and to bolster measures to protect investors, they added. The aim is to double the issuance number this year, said the sources. Underwriters for these deals have been asked to play a more proactive role in creating demand by facilitating trading of the bonds in the secondary market, said the sources, who declined to be named as they were not authorised to speak to the media. These measures highlight Beijing's efforts to address a mismatch in China's 33 trillion yuan corporate bond market with state enterprises dominating the market. Currently, private issuers account for just 2.4% of China's credit bond market, compared with 95% for state-owned companies, according to Shenwan Hongyuan Securities. Beijing has vowed to broaden the financing pipeline for the private sector, which contributes more than 60% of the economic output and over half of tax revenue, especially as it looks to cushion the impact of Sino-U.S. tensions on the domestic economy. Investors typically do not consider onshore bonds of private firms as an investment option, as they seek safety in notes issued by state-owned enterprises (SOEs) and financial firms, said one of the sources. At the same time, "investors complain of meager yields" offered by state-backed issuers in a low-interest-rate environment, making the Shanghai exchange's new framework a timely move, said the source. The 53 companies, including privately owned conglomerate Nanshan Group and electrical equipment maker TBEA Co, offered coupon rates averaging just shy of 3% - and as much as 4% - for their bonds under the new framework, said the sources. That compares with financing costs of around 2% for big, state-owned issuers. Details of the new framework have not previously been reported. The Shanghai Stock Exchange did not respond to Reuters' request for comment. DEFAULT RISKS The Shanghai bourse arranges frequent virtual and physical roadshows for securities firms, hedge fund houses and wealth managers to better understand the businesses and financial health of the issuers under the initiative, the sources said. The bourse also pushes brokerages to buy the bonds they underwrite and trade the securities in the secondary market to create demand and whet investor appetite for these issuances, they added. Despite the allure of higher returns, some of the investors are not very sanguine about the investment option given the uncertain outlook for private business amid sluggish consumer demand in the world's second-largest economy. Huang Xuefeng, credit research director at Shanghai Anfang Private Fund Co, said his company had bid for some bonds under the new framework, but most of the issuers were not very appealing. "The coupon rates are not super attractive, especially when the issuer is a private company," Huang said. "One would prefer bonds sold by local government financial vehicles, which have few default risks." Huang said that coupon rates higher than 5% by private firms would be enticing, but such pricing could betray financial weakness, potentially discouraging investment by risk-averse institutions. Private companies accounted for 64% of China's bond defaults by value between 2014 and August 2023, according to Shenwan Hongyuan. Investors in China typically do not flock to low-rated, high-yield bonds, compared to the U.S. where the junk bond market is a key segment and has played a pivotal role in financing tech innovations and leveraged buyouts. (Reporting by Shanghai Newsroom; Editing by Sumeet Chatterjee and Stephen Coates)
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First Post
23-05-2025
- Business
- First Post
New battle brews against Beijing: Singapore, Indonesian holiday islands protest China's alumina push -- taking
China's Nanshan Group, has planned to establish a local unit in the Indonesian island of Bintan, sparking protests among businesses that operate there read more China's business ambitions are hurting the peace and calm of a cluster of islands that is a popular tourist spot among Singaporeans. A large China-based conglomerate, Nanshan Group, has planned to establish a local unit in the Indonesian islands of Bintan and other archipelagos, sparking protests among businesses that operate there. Although the company claims to adhere to environmental regulations and has pledged to minimise its ecological impact, the project has drawn renewed attention to the rapid expansion of Chinese raw materials firms in Indonesia. STORY CONTINUES BELOW THIS AD However, this will not be the first time Nanshan has built a presence in the Indonesian islands. The company's Gbkek Industri Park already has an industrial park in Bintan's southeast. The Indonesian government has created a special economic zone in the area to lure more investments, and as part of this status, Nanshan enjoys perks like tax waivers for up to 20 years. What's the plan? The firm has now announced plans to bring more Chinese firms to the site and build a $6 billion aluminium smelting complex by 2028. As part of this expansion, there are plans to develop another industrial park on nearby Pulau Poto, a small, low-lying sandy island. According to resort co-owner Andrew Dixon, citing environmental impact documents shared with local business operators, the proposed development includes a steel smelter, an oil refinery, and both multi-purpose and bulk cargo ports. Gbkek director Santoni told Bloomberg that the Indonesian government has permitted the company to expand its operations to Poto. He said that the firm will build a petrochemical industry on the island as well as build ports. 'We will expand and develop the GB Special Economic Zone, that is also our right. We don't understand what the objections of the resort operator are,' he said. Why are people protesting? Dixon has said that industrial operations on Poto 'would not just be devastating for our own business but it's going to devastate the communities in that area.' According to him, resort operators and landowners, who have been filing objection letters since 2023, submitted their most recent protest to the Indonesian government earlier this month, addressing it to the environment and tourism ministries. A meeting between the involved parties is scheduled for next week. STORY CONTINUES BELOW THIS AD 'What was once a very rich unique marine environment is now a nearly dead zone,' said Marc van Loo, who owns the resort on the island.
Bloomberg
22-05-2025
- Business
- Bloomberg
Island Resorts Near Singapore Under Threat From China Smelter
One of China's biggest aluminum companies is threatening to disrupt the serenity of a cluster of islands that are a top holiday destination for Singapore visitors, sparking protests. A battle is brewing over the future of the Indonesian islands, which includes Bintan, the most popular destination. Around two dozen parties, including luxury resort operators across Bintan and operators of five nearby private islands, are speaking out against plans by a local unit of Nanshan Group to establish an industrial park on one of the atolls.
Bloomberg
25-03-2025
- Business
- Bloomberg
Glencore-Backed Alumina Producer Declines in Hong Kong Debut
Nanshan Aluminum International Holdings Ltd., a company backed by Glencore Plc, declined in its Hong Kong trading debut, with sentiment for the top alumina producer in Southeast Asia impacted by falling prices for the metal. Shares were down 1% to HK$26.35 apiece as of 10:27 a.m. local time during the first day of its initial public offering, after rising as much as 1.1% earlier. The newly listed unit of China's Nanshan Group will use the sale's proceeds to expand production in Indonesia and for general working capital.
