Hong Kong Stocks Rise, Led by CyberWorks After Hutchison Pact
By Yeong Choy Leng
Hong Kong, Feb. 23 (Bloomberg) -- Hong Kong stocks rose as Pacific Century CyberWorks Ltd. posted its biggest gain in two weeks after it said Hutchison Whampoa Ltd. will pay HK$4.375 per share for an 0.8 percent stake in the company.
``It's positive as it will drive speculation that HK$4.375 is the bottom for CyberWorks since Hutchison has a good track record'' of buying low and selling high, said Winson Fong, who helps manage $1.8 billion in Asian stocks at SGY Asset Management Ltd. in Singapore.
China-related stocks traded in Hong Kong, or H shares, rose as investors rushed to buy on the last day before their hard currency B shares start trading Monday under the new rules on stock ownership in the mainland.
The Hang Seng Index rose 181.92, or 1.2 percent, to 15,280.56. For the week, the index lost 2.2 percent. In the broader market, 357 stocks rose, 131 fell and 234 were unchanged. Trade at HK$11.3 billion ($1.5 billion) was almost a third higher than the daily average for the past three months.
The following is a list of companies whose shares were active:
Pacific Century CyberWorks Ltd. (8 HK ), Hong Kong's largest telecommunications company, rose 17.5 cents, or 4 percent, to HK$4.55, its biggest gain since Feb. 12. CyberWorks will take over Hutchison Telecommunications Technology Investments Group in a share swap with Hutchison Whampoa Ltd. (13 HK ). Hutchison, which will obtain a stake worth $103 million in CyberWorks as a result of the swap, fell HK$1, or 1.1 percent, to HK$90.75. Separately, Hutchison said it will spend up to 4 billion euros ($3.6 billion) over the next few years to develop its Italian third-generation mobile phone network, according to a company official.
China stocks rose on expectations new rules allowing local investors to buy B shares will boost their Hong Kong and overseas counterparts. Prior to the new rules, H shares trade at an average of 11 times earnings, compared with 20 times for B shares and 63 times for local currency A shares. CATIC Shenzhen Holdings Ltd. (161 HK ), an electronics maker, surged 15 cents, or a record 28 percent, to 69 HK cents, bringing its gain this week to 73 percent. Separately, the company said yesterday the new share sale of unit Shenzhen Tian Ma Microelectronics Co Ltd. was 1.2 times oversubscribed. PetroChina Co. (857 HK ), the listed unit of China's largest oil company, rose 3 cents, or 2.2 percent, to HK$1.40.
HSBC Holdings Plc (5 HK ), the U.K.-based parent of the city's two largest lenders, rose HK$1.50, or 1.3 percent, to HK$117. Its Credit Commercial de France SA unit will buy Banque Hervet, France's last state-owned bank, for 3.47 billion francs ($480 million) to bolster its regional network. The bank will also reorganize its global debt and structured finance business as part of a revamp of its investment banking operations. Separately, the stock rose on hopes the bank will report a 28 percent increase in net income Monday, according to a Bloomberg News survey of six analysts.
Hang Seng Bank Ltd. (11 HK ), Hong Kong's second- largest bank and a subsidiary of HSBC, rose HK$1, or 1 percent, to HK$103. The lender is expected to report second-half 2000 profit rose 25 percent from a year earlier as the bank sold more loans and cut bad loan provisions, based on average estimates of 29 analysts surveyed by IBES International Inc.
CLP Holdings Ltd. (2 HK ), Hong Kong's biggest electricity company, rose 60 cents, or 1.6 percent, to HK$39.40, its highest level since Oct. 11, 1999. Investors hope the company will announce a larger-than-expected dividend payment to investors to commemorate its founding 100 years ago when it releases its full-year earnings next Monday, said Bill Mok, an analyst at ING Barings Ltd. in Hong Kong. CLP said in January it would give a HK$200 ($25.64) rebate to each of its 1.9 million customers to mark the occasion.
Henderson China Holdings Ltd. (246 HK ), the mainland arm of Hong Kong's third-largest developer, rose 10 cents, or 2.6 percent, to HK$4. The company may raise HK$2.8 billion ($359 million) by selling real estate in the Chinese city of Guangzhou, the South China Morning Post said, citing company Executive Director Li Shek-yin.
Kerry Properties Ltd. (683 HK ), a mid-sized Hong Kong real estate developer controled by the family of Malaysian tycoon Robert Kuok, fell 35 cents, or 3 percent, to HK$11.35. The company said profit last year fell 2.5 percent, in line with expectations. The stock gained 44 percent in the past three months.
Shum Yip Investment Ltd. (604 HK ), controled by the municipal government of Shenzhen, a mainland Chinese city adjoining Hong Kong, rose 13.5 cents, or 7.1 percent, to HK$2.025. Its property unit, Gold Field, will raise 847.8 million yuan ($102.4 million) selling shares to Chinese domestic investors, Ming Pao Daily said, without citing anyone.
SIIC Medical Science and Technology (Group) Ltd. (8018 HK ), the pharmaceutical unit of Shanghai Industrial Holdings Ltd., rose 5 cents, or 3.6 percent, to HK$1.44. The company said the 734 million yuan new share sale of its personal care products and cosmetics unit, Shanghai Jahwa Joint Stock Corp., was 410 times oversubscribed.
Sinopec Shanghai Petrochemical Corp. (338 HK ), a unit of China Petroleum & Chemical Co., rose 10 cents, or 9.5 percent, to HK$1.15. The company said it will increase capacity at its ethylene plant by 55 percent by June to meet growing domestic demand, primarily in the country's eastern coastal provinces.
Television Broadcasts Ltd. (511 HK ), Hong Kong's dominant over-the-air broadcaster, was unchanged at HK$46.60 after falling as much as 1.3 percent. Its Internet unit, TVB.com said it fired almost half of its Hong Kong-based staff, shifting work to cheaper mainland Chinese workers.
Renren Media Ltd. (59 HK ), which operates the Chinese language Website renren.com, fell 1 cents, or 24 percent, to 3.2 HK cents, rounding off a 53 percent loss in the past three months after shares were suspended in the past week. The company said it failed to secure a buyer for a 67 percent stake owned by its controling shareholder, casting further doubt on the company's future.
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