Chinese Companies are Showing Strength in the Stock Market
LONDON, October 30, 2017 /PRNewswire/ --
China's stock market has posted gains of almost 50 percent in 2017, where giant Chinese tech companies have taken the lead. The MSCI China Index is up 49 percent this year. According to consulting firm McKinsey, internet companies in China have grown substantially from 5 million users in 2000 to 225 million in 2016. An article by CNBC states, "There are three times as many companies, and the (Chinese) market capitalization has gone from $2 trillion in 2004 to $12 trillion." Shineco Inc (NASDAQ: TYHT), JD.com (NASDAQ: JD), Ctrip.com International, Ltd. (NASDAQ: CTRP), Weibo Corp. (NASDAQ: WB), iKang Healthcare Group, Inc. (NASDAQ: KANG)
Internet companies particularly have paved the way for a diverse array of businesses to shine in the Chinese market. "These internet companies have facilitated the roll-out of lots of other types of businesses in China - from gaming to payment systems, online money market funds and streaming entertainment," said Andrew Mattock, lead manager at Matthews China Fund. "What investors are buying today at a stock level in China is a lot more diversified... The companies driving the stock market earnings now are not the cyclical industrial companies of the past. So that means a lot better cycle in terms of earnings. I don't think we'll get the same uplift in corporate earnings next year as this year, but I still think we'll see healthy profitability growth," Mattock stated.
Shineco Inc (NASDAQ: TYHT) announced late last week breaking news that, "the Company, through its subsidiary Tianjin Tajit E-Commerce Ltd., has obtained contractual rights to distribute branded products of Daiso Industries Co., Ltd.("Daiso"), a large franchise of 100-yen shops founded in Japan, via JD.com (NASDAQ: JD), the largest e-commerce company and largest retailer in China.
Pursuant to the contractual arrangement, Shineco is authorized to distribute Daiso's branded products and utilize its brand names in connection therewith in China through Tianjin Tajit E-Commerce Ltd. The cooperation between Shineco and JD includes many business initiatives, covering a broad spectrum of online retail. It allows the Company to access JD's significant online customer base to advance Shineco's business pursuit in China. JD will leverage Shineco's business expertise, and Shineco will serve as JD's authorized vendor for providing its customers with access to a wide range of products of Daiso.
JD and Shineco are expected to join forces on promoting innovation of online retail business model, which is expected to improve Shineco's brand awareness and might result in enhanced marketing and continued growth."
Mr. Yuying Zhang, Chairman and Chief Executive Officer of Shineco, stated, "We are excited about teaming up with China's e-commerce giant JD and Japan's retail giant Daiso, and the potential market that new relationship can bring to our business. JD's vast online retail channel will enable us to distribute Daiso's products in a more efficient and economical manner to meet the growing consumer demand in China, which further drives the Company's fast expansion in e-commerce, enhances the influence of the Company and builds up the brand awareness of Shineco."
Mr. Zhang continued, "As the market globalization and digital transformation continues to challenge traditional business concept, we need to develop the business faster and in a more flexible way. Distributing Daiso branded products via JD would be an exciting leap in this transformation and allows us to move forward with an even greater focus on innovation and development to meet changing customer needs in China. Given the fact that Daiso can now benefit over 20 million Chinese families, this part of our business is expected to achieve an annual growth rate of 20%. We look forward to offering customers a tremendous number of Daiso's quality products not previously widely available across China through JD."
Ctrip.com International, Ltd. (NASDAQ: CTRP) is a leading provider of accommodation reservation, transportation ticketing, package tour and corporate travel management and other travel-related services in China. It has gone through rapid growth since its inception in 1999 and become China's largest travel company. Ctrip is the largest consolidator of hotels and other accommodations in China in terms of volume of rooms booked. Ctrip covers approximately 500,000 hotels in China and approximately 750,000 hotels abroad. Ctrip is also the largest transportation ticket booking platform in China, which offers ticketing services including air, train, bus tickets and other transportation services. It operates a centralized reservation system and a highly efficient fulfillment infrastructure. Ctrip works with all domestic airlines and over 320 international airlines, with air ticketing products covering over 220 countries and territories, 3,600 international cities and 8 million routes.
Weibo Corp. (NASDAQ: WB) is a leading social media for people to create, share and discover Chinese-language content. It provides an unprecedented and simple way for people and organizations to publicly express themselves in real time, interact with others and stay connected with the world. Recently, the company announced its unaudited financial results for the fiscal quarter ended September 30, 2017. For the third quarter of 2017, Weibo's total revenues were $320.0 million, consisting of advertising and marketing revenues of $276.8 million and other revenues of $43.2 million. Advertising and marketing revenues from small & medium-sized enterprises and key accounts were $251.5 million. Advertising and marketing revenues from Alibaba were $25.3 million.
iKang Healthcare Group, Inc. (NASDAQ: KANG) is one of the largest providers in China's fast-growing private preventive healthcare space through its nationwide healthcare services network. iKang's nationwide integrated network of multi-brand self-owned medical centers and third-party facilities, provides comprehensive and high-quality preventive healthcare solutions across China, including medical examination, disease screening, outpatient service and other value-added services. On September 15, 2017, the company announced its unaudited financial results for the first quarter ended June 30, 2017. Net revenues were US$115.6 million, an increase of 14.2% year-over-year. Net income attributable to the Company was US$3.6 million, an increase of 73.1% year-over-year.
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