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Tag: shares

  • Shopify Projects Robust Quarterly Revenue Amidst Resilient Merchant Base And Steady Consumer Demand

    Shopify Projects Robust Quarterly Revenue Amidst Resilient Merchant Base And Steady Consumer Demand

    Shopify, the renowned Canadian e-commerce platform, has projected a positive outlook for its quarterly revenue. This forecast comes amidst no apparent reduction in consumer demand and the impressive resilience of merchants on the platform despite prevailing tariff pressures. This uplifting news resulted in a significant 20% increase in the company’s share values.

    Throughout early August, Shopify’s merchant base demonstrated remarkable fortitude, maintaining the steady growth observed in the April-June period. This resilience contributed to a 31% boost in the second quarter’s revenue.

    These results help to alleviate some of the anxieties investors have due to the fluctuating trade policies of the current US administration. These policies have left many retailers uncertain about several aspects of their business, including demand, production, sourcing, and operating costs.

    Addressing these concerns, Jeff Hoffmeister, Shopify’s CFO, reassured investors during a post-earnings call. He affirmed that demand from the US, both inbound and outbound, has remained steady. Furthermore, he noted that the platform had experienced growth across all merchant segments during the second quarter.

    Hoffmeister also highlighted the strong performance of sellers with an annual gross merchandise volume (GMV) exceeding US$50 million and those below the $2 million mark. In terms of pricing strategy, Shopify reported that many merchants have increased their prices, although no specific details regarding the extent of these hikes were provided.

    Despite the ongoing disruptive tariff situation, Shopify’s resilience and adaptation seems to be the current narrative. As noted by Third Bridge analyst Charlie Miner, greater clarity is emerging regarding consumer reactions, and Shopify is unlikely to be adversely affected.

    Shopify’s projections for the third quarter anticipate a revenue increase in the mid to high twenties percentage range. This estimate exceeds analyst predictions of a 21.54% rise, as compiled by LSEG.

    Additionally, Shopify’s ongoing investments in artificial intelligence-powered features are proving advantageous. These features aid retailers in various tasks, such as developing store websites, generating images, and collating sales data.

    Questions & Answers

    What is the projected revenue increase for Shopify in the third quarter?
    Shopify projects a mid to high twenties percentage increase in revenue for the third quarter.

    How are Shopify’s merchants responding to the ongoing tariff situation?
    Despite tariff pressures, merchants on Shopify’s platform have shown resilience, with many even increasing their prices.

    What investments has Shopify made to support retailers?
    Shopify has invested in artificial intelligence-powered features that assist retailers with tasks such as creating store websites, producing images, and gathering sales data.

  • LVMH deputy CEO shares strategy to manage tariffs

    LVMH deputy CEO shares strategy to manage tariffs

    French luxury powerhouse LVMH may have the ability to increase prices on their premium products by 2-3% annually without significantly impacting demand. This insight comes from the company’s deputy CEO, Stephane Bianchi, who shared the information during a recent parliamentary hearing in France. The discussion aimed to explore the group’s potential strategies for counteracting potential tariffs.

    Price Elasticity of Luxury Goods

    According to Bianchi, customers purchasing the group’s most exclusive items, such as high jewelry, are likely to tolerate modest price increases. However, he also warned that there are limitations to this tolerance, emphasizing that price elasticity for these products is not infinite.

    Recent developments in global trade politics have also influenced LVMH’s pricing strategies. The US president recently postponed a plan to impose 50% tariffs on imports from the European Union. Instead, negotiations are set to continue between Washington and the 27-nation European bloc, with a new deadline set for July 9th.

    Challenges with Raising Prices on Lower-Priced Products

    While price increases may be feasible for high-end goods, the same cannot be said for some of the lower-priced items in LVMH’s offerings. Specifically, the company may face issues with raising prices for its beauty products and cognac, according to Cecile Cabanis, the group’s finance chief. She indicated a lack of ability to adjust the prices of these items, stating that “the capacity to raise prices is not there.”

    Questions & Answers

    What is LVMH’s strategy for offsetting potential tariffs?
    LVMH’s strategy for offsetting potential tariffs includes the potential to increase prices on their premium products by 2-3% annually without significantly impacting demand.

    What are some limitations of this pricing strategy?
    Though price hikes may be absorbed by buyers of high-end products, there are bounds to their tolerance. Additionally, the company may struggle to adjust prices for lower-cost items, such as beauty products and cognac.

    How have global trade politics influenced LVMH’s pricing strategies?
    Recent developments, such as the US president’s decision to postpone tariffs on European imports, have influenced LVMH’s approach. This decision allows for further negotiations and potentially impacts the group’s pricing strategies for products sold in the US market.

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  • Tesla Shares Close Lower After 3-1 Stock Split

    Tesla Shares Close Lower After 3-1 Stock Split

    Tesla’s shares closed 2% lower on Thursday as a three-for-one stock split announced by the world’s most valuable automaker to woo retail investors came into effect.

    The stock opened at $302 and closed at $296.07 as the split allowed investors to get two additional shares for each they owned as of Aug. 17. It had closed at $891.29 before the split on Wednesday.

    This is the second stock split by Tesla in as many years and follows similar moves by high-growth companies such as Amazon.com and Google-parent Alphabet to address the growing need to diversify investor base.

    Stock splits “certainly have a higher appeal to retail investors and makes their options more affordable as well,” said Art Hogan, chief market strategist at B. Riley.

    “Retail investors are a very important cohort for Tesla and today’s stock split is an acknowledgment of that fact.”

    Austin-based Tesla debuted in 2010 at $17 and in a decade surged to a peak price of $2,000, becoming one of the highest priced shares on Wall Street and making it difficult for small investors to bet on the high-growth stock.

    The company decided to split its stock on a five-for-one basis in August 2020 and breached $1 trillion in market capitalization in 2021.

    The EV maker is the sixth company in the S&P 500 index to split its shares this year, according to Howard Silverblatt, senior index analyst for S&P and Dow Jones indices.

    Tesla’s ticker was trending on social media stocktwits.com, indicating increased chatter among individual investors. The shares have lost about 11% of their value since March when the company announced plans to increase its number of shares.

    “In typical buy-the-rumor, sell-the-news style, investors tend to drastically scale back purchases of splitting stocks in the weeks ensuing the effective split date, causing price momentum to slow,” analysts at Vanda Research said in a note.

    A stock split does not affect the fundamentals of a company, but makes it easier for individual investors to do small trades. The benefits of such splits, however, are becoming less clear as brokerages let customers buy parts of a company’s share.

    Tesla’s shares have fallen about 16% so far this year amid a selloff in high-growth stocks due to worries over aggressive interest rate hikes and geopolitical uncertainties.

  • HTC shares details about first flagship phone in more than 3 years

    HTC shares details about first flagship phone in more than 3 years

    Around a decade back, HTC was one of the biggest smartphone makers in the world but has almost sunk into oblivion in recent times. The company never announced a retreat from the market, and even though it scaled back operations after selling a chunk of its business to Google in 2018, it still quietly sells affordable phones in select markets. The Taiwanese manufacturer has now revealed plans to release a flagship smartphone in April.

    Vice President of HTC’s Asia-Pacific Region, Charles Huang said during the ongoing Mobile World Congress (MWC) that the company will introduce a high-end smartphone next month.

    The company last released a flagship smartphone, the Exodus 1, in 2018. It was a blockchain-focused handset and was powered by Qualcomm’s premium Snapdragon 845 chip. HTC, which was the first to make both an Android device and a Windows Mobile handset, has been in the red since 2015 and has shifted focus to virtual reality headsets and accessories.

    During MWC, the company announced Viverse, which is its version of the metaverse and will make use of the in-house Vive VR headsets. It comes as no surprise that HTC is planning on integrating some metaverse features into the phone. It looks like the company wants to target consumers who would like to use their phone for augmented reality and virtual reality applications.

    Other details are still under wraps, but more information will likely be coming soon. Whether it will help HTC turn things around and give a tough time to the best phones of 2022 remains to be seen.

  • Facebook stock takes historic dive, after Zuckerberg claims Apple cost him $10B

    Facebook stock takes historic dive, after Zuckerberg claims Apple cost him $10B

    Facebook’s parent company Meta is currently undergoing one of the biggest stock price drops in the company’s history. Meta’s shares plummeted by more than 23% over the past 24 hours—which will ultimately result in Meta’s market cap crashing down by $210 billion, to about $689 billion.

    This comes as a direct result of Mark Zuckerberg’s disappointing earnings report on Wednesday evening, which revealed that the company had fallen below its projected earnings estimates for the last quarter of 2021. As a consequence, the company is forecasting another low-earning quarter in 2022.

    According to Zuckerberg’s lengthy post, Apple is largely to blame for the blow to the company’s revenue.

    He directly called out Apple and its App Tracking Transparency policy in his report, claiming that the tech giant’s privacy-friendly update in iOS 14.5 is going to end up costing Meta $10 billion, as the company is currently rebuilding its entire ad infrastructure in order to better target iOS users going forward.

    “Next up is ads,” Zuckerberg began. “With Apple’s iOS changes and new regulation in Europe, there’s a clear trend where less data is available to deliver personalized ads.”

    “But people still want to see relevant ads,” he continued, “and businesses still want to reach the right customers. So we’re rebuilding a lot of our ads infrastructure so we can continue to grow and deliver high-quality personalized ads.”

    As part of this restructuring process, Meta has announced that it will be an increasing focus on Instagram Reels—which have been becoming increasingly popular with users’ decreasing attention spans—as well as other investments that may prove profitable in the long run. A huge part of that is Meta’s grand plans to revolutionize the internet by introducing the Metaverse.

    Zuckerberg also revealed that for the first time in history, Facebook has seen a visible decline of active users on the platform during the fourth quarter of 2021. Yet the company is holding on to the hope that things will take a turn for the better with the new ad infrastructure, as well as project Metaverse.

  • Snapchat parent Snap reports its first profitible quarter ever

    Snapchat parent Snap reports its first profitible quarter ever

    Yesterday we told you that Facebook parent Meta said that Apple’s App Tracking Transparency (ATT) feature, which allows iOS users to opt-out of being tracked for the purposes of receiving custom online ads, will cost Meta $10 billion in revenue this year. That bit of news, along with Meta announcing that it will fall short of Wall Street’s expectations for first-quarter 2022 revenue, sent the company’s shares down 26.4% on Thursday to $237.76, a loss of $85.24.

    Another company that has been affected by Apple’s ATT is Snap, the parent company of messaging app Snapchat. But the latter had a much better experience last year than Facebook/Meta had and even reported today the first quarterly profit in company history.

    For the fourth quarter of 2021 Snap had revenue of $1.3 billion, up 42% year-over-year. Net income for the three-month period hit $23 million, the first time that the company was in the black during any quarter.

    In 2021, Snap grossed $4.1 billion, up 64% compared to the same quarter a year ago. The company still was in the red for the entire year, but the net loss declined 48% to $488 million on an annual basis. Snap Chief Financial Officer Derek Andersen said that the company’s first quarterly profit and the improvement in the amount of red ink it spilled in 2021 can be attributed to how the company’s advertising business “began to recover from the impact of the iOS platform changes quicker than we anticipated.”

    During regular trading hours on Thursday, Snap shares declined $7.57 or 23.60% to $24.50. Most investors figured that Snap would be making a similar grim announcement about Apple’s ATT as Facebook did. Instead, after the earnings report was released, Snap soared $14.50 or 59.18% to $39. That is still far off the 52 week high above $83.

    Snap says that it has developed tools to help advertisers adjust to the large number of iOS users who do not want to be tracked for custom advertisements. Jeremi Gorman, Snap’s chief business officer, admitted that it will take time to adjust but said “We are pleased with the early progress.”

    Other companies have also reported that the market for digital advertising is strong. Google reported a 33% year-over-year hike in total ad revenue which includes Search (up 36% over last year), and YouTube (up 25.3% on an annual basis). Microsoft foreshadowed its upcoming earnings report when it said that the ad market is strong for LinkedIn ads, and for ads on its Bing search engine.

    While Meta forecasts a shortfall for its first-quarter profits, Snap expects revenue for the quarter to reach $1.08 billion topping analysts’ expectations. In addition, Snapchat’s Daily Active Users (DAU) rose 20% in Q4 to 319 million. DAU numbers improved sequentially and year-over-year in North America, Europe, and the Rest of the word.

    Also, the Daily Active Users number has seen 20% year-over-year growth for five consecutive quarters. That is due to the strong usage of the Snapchat app by teens and young adults.

    Snap also noted that it has been investing in its AR platform and revealed that its 18 New Year’s Eve Lenses generated more than 7 billion impressions. New features have been added to its Lens Studio including “a new Sounds Library, real-world physics, world mesh, and an API library for real-time data.

    Snapchat also released a feature for the Google Pixel 6 and Pixel 6 Pro called “Quick Tap to Snap” allowing users of those two phones to access the Snapchat camera with two simple taps on the lockscreen. And Snap’s first original programming, “The Me and You Show,” starring Snapchatters and their friends, reached more than 50 million viewers.

    And for those Disney fans out there, new Lenses were released featuring characters like Elsa from Frozen and Timon from The Lion King.

    The difference between Meta and Snap is that Snap has been able to work around Apple’s ATT and rolled with the punches. Facebook/Meta yelled “bloody murder” and spent its time picking on Apple instead of finding a solution as Snap did. That’s why Meta shares collapsed by over $85 on Thursday and Snap shares are poised to rise over 50% on Friday morning.

  • Tesla’s Bumper Delivery Numbers Charge Up Shares

    Tesla’s Bumper Delivery Numbers Charge Up Shares

    Tesla Inc’s shares started the year with stellar gains after the electric carmaker reported record deliveries for the fourth quarter, allaying fears of supply chain woes that have hit automakers. Shares of the world’s most valuable carmaker ended up 13.5% at $1,199.78 each on Monday, marking the biggest daily percentage gain in nearly 10 months. Analysts expect the strong delivery numbers to bolster 2022 expectations and see the pace of expansion of its new factories in Berlin and Texas to be large determinants.

    “We expect a gradual ramp of Berlin and Austin and anticipate those ramps will lead to a deceleration of exports from Shanghai, many of which have been bound for Europe in 2021,” Cowen analyst Jeffrey Osborne said.

    The company, like others, faces component shortages as a global logistics crunch and factory closures due to the pandemic limited supply. But Tesla managed to overcome much of the problems by reprogramming software to use less scarce chips. Tesla delivered 308,600 vehicles in the fourth quarter, higher than analysts’ forecasts of 263,026 vehicles, which includes its Model 3 compact cars and Model Y sport-utility vehicles and flagship Model S and Model X vehicles, the company reported on Sunday.

    RBC Capital Markets revised its quarterly revenue estimate, bumping it up by $2.3 billion. J.P. Morgan boosted its profit estimates. Still, analysts said Tesla has a lot to watch out for in 2022 as competition heats up with several startup EV companies scheduled to launch their first cars on the road. Legacy automakers such as Ford and General Motors also are shifting focus to electric cars.

    “We see 2022 being a more challenging year than 2021 was in light of increasing competition, and we believe the design of the four vehicles on the road are getting long in the tooth which likely decelerates growth,” Osborne said.

    Some analysts also said Tesla’s stock is over-valued, given its relatively smaller production volume. Tesla, which produced some 930,000 vehicles last year, is about four times more valuable than Toyota Motor which aims to produce 9 million vehicles in the year that ends in March.

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  • Musk Sells Nearly $7 Billion Worth Of Tesla Shares This Week

    Musk Sells Nearly $7 Billion Worth Of Tesla Shares This Week

    Tesla CEO Elon Musk offloaded a combined $6.9 billion worth of shares in the electric car company this week, taking advantage of a meteoric rally that vaulted the firm’s value to over $1 trillion. The billionaire sold 1.2 million shares held by his trust for more than $1.2 billion on Friday, the latest in a flurry of his stock transactions, according to U.S. security filing released later in the day.

    The world’s richest person and Tesla’s top shareholder last Saturday tweeted that he would sell 10% of his shares if users of the social media platform approved the move. The 10% would be about 17 million shares at the time of his tweet.

    He has sold 6.36 million shares this week – around 37% of 17 million. He now needs to offload about 10 million more shares to fulfill his pledge to sell 10% of his holdings.

    Shares of Tesla Inc closed lower on Friday, down 2.8% at $1,033.42, snapping an 11-week winning streak. The shares are up more than 46% this year following a sharp rally in October.

    The stock sales, which marked the first time that Musk cashed out on a stake of that size since the company was founded in 2003, were massive by capital market standards, eclipsing the initial public offerings of most companies.

    By getting Twitter users to green-light the move, he has blunted potential criticism of cashing out at a time when Tesla’s valuation has become frothy and shares are at record highs.

    Tesla shares fell 15.4% this week and lost some $187 billion in market value, more than the combined market capitalizations of Ford Motor Co and General Motors Co.

    Despite the week’s losses, Tesla is still the most valuable automaker in the world. Recent strong gains in the stock have underscored demand for shares of electric vehicle (EV) makers.

    After the blockbuster market debut of Rivian Automotive Inc on Wednesday, the two most valuable U.S. automakers are EV companies.

    In a veiled jab at the Irvine, California-based rival, Musk tweeted on Thursday: “There have been hundreds of automotive startups, both electric & combustion, but Tesla is (the) only American carmaker to reach high volume production & positive cash flow in past 100 years.”

    Musk had previously said he would have to exercise a large number of stock options this year, which would create a big tax bill. Selling some of his stock could free up funds to pay the taxes.

    Prior to the sale, Musk owned a stake of about 23% in Tesla, including stock options. After his exercise on 2.15 million stocks on Monday, he has options for 20 million more shares he needs to exercise by next August.

    “We expect the share sales will continue, as Musk holds millions of options worth billions of dollars that would otherwise expire worthlessly, and he has also prearranged share sales under 10b5-1 plans,” said Jason Benowitz, senior portfolio manager at the Roosevelt Investment Group LLC in New York.

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  • Elon Musk Sells $5 Billion In Tesla Shares After Twitter Poll

    Elon Musk Sells $5 Billion In Tesla Shares After Twitter Poll

    Tesla Chief Executive Elon Musk sold about $5 billion in shares, the billionaire reported in filings on Wednesday, just days after he polled Twitter users about selling 10% of his stake. In his first share sale since 2016, Musk’s trust sold nearly 3.6 million shares in Tesla, worth around $4 billion, while he also sold another 934,000 shares for $1.1 billion after exercising options to acquire nearly 2.2 million shares. The 4.5 million shares equate to about 3% of his total holdings in the electric vehicle manufacturer, which makes up the vast part of his estimated $281.6 billion fortune, according to Forbes.

    Musk on Saturday polled Twitter users about selling 10% of his stake, helping to push down Tesla’s share price after a majority on Twitter said they agreed with the sale. The stock sank 12% on Tuesday in a multi-day selloff that endangered the company’s position in the $1 trillion club, but recovered 4.3% on Wednesday.

    The options-related sales were set up in September through a trading plan that allows corporate insiders to establish preplanned transactions on a schedule, the filing said. The sales of the option-related shares paid for associated taxes. It was not clear how or whether the trading plan related to Musk’s Twitter poll. Tesla did not respond to a request for comment.

    The additional share sales were separate and provide Musk with sizeable reserves of cash, given his wealth is largely tied to his stakes in Tesla and SpaceX. Musk has more than 20 million further stock options that are due to expire in August of next year. If Musk carried out the 10% stock sale plan, it would be a slight negative near term, said Mark Arnold, chief investment officer at Hyperion Asset Management in Brisbane where Tesla is the top holding in its global fund. “But the stock is pretty liquid and its not a huge percentage of total issued shares, so it shouldn’t have that much of an impact … we’re quite comfortable with the outlook for the business,” he said.

    While Tesla has lost close to $150 billion in market value this week, retail investors have been net buyers of the stock. Some 58% of Tesla trade orders on Fidelity’s brokerage website on Wednesday were for purchases, rather than sales. Retail investors made net purchases of $157 million on Monday and Tuesday, according to Vanda Research. Tesla is now up more than 51% in 2021, thanks largely to an October rally that was fueled by an agreement to sell 100,000 vehicles to rental car company Hertz.

    “The company itself is on fire, with strong results,” said Tim Ghriskey, a senior portfolio strategist at New York-based investment management firm Ingalls and Snyder. Bullish sentiment returned to Tesla’s options on Wednesday, with about 1.1 calls traded for every put. Calls are typically used for bullish trades, while buying puts shows a bearish bias. The company’s options accounted for about $109 billion in premium changing hands over the last two weeks, or about one in every three dollars traded in the U.S.-listed options market, according to a Reuters analysis of Trade Alert data.

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  • Elon Musk Shares Secret About CyberTruck Mirrors

    Elon Musk Shares Secret About CyberTruck Mirrors

    When the CyberTruck was unveiled for the first time in 2019 it had these cameras which doubled as side-view mirrors. But at the time many believed that the regulators aren’t going to allow Tesla to pull off this stunt. So more recently, the car was indeed seen with mirrors. But these mirrors ruin the seamless symmetry and the cyberpunk futurism of the car. Now, in a tweet, Elon Musk has revealed that the mirror is required by the law but they have been designed in such a way that they can be removed easily by the owners.

    The side-view mirrors are a requirement of the US Federal Motor Vehicle Safety Standard referred to as Rear Visibility. The side mirrors assure that the driver has a good view of obstacles around the sides and the rear of the truck.

    Tesla strived to remove the mirrors altogether as modern cars also come with blindspot detection cameras as well as rearview cameras which help in reversing. Tesla has always future-proofed its cars with advanced hardware and constant software updates and if and when the regulation is changed Tesla has added the ability for its owners to remove the mirror as the cameras are already baked in.

    Tesla’s vehicles also come with advanced autonomous capability and the Cybertruck will be the first car it releases that will come with a new generation of self-driving chips and cameras. In other words, these cars by the time they come out in 2022 will have the latest hardware and software and an old-school solution like side-view mirrors will be hugely redundant.

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  • Alibaba Co-Founders Pledge Shares for Loans

    Alibaba Co-Founders Pledge Shares for Loans

    Alibaba co-founders Jack Ma and Joseph Tsai are reportedly pledging their shares in the Chinese e-commerce giant in exchange for significant loans from global banks.

    The two tech billionaires have pledged their shares to banks including UBS, Credit Suisse, and Goldman Sachs, according to a «Financial Times» report citing company documents.

    The shares pledged were made by offshore companies controlling more than half of Ma and Tsai’s stake in Alibaba – 5.8 percent as of December valued at $35 billion – through the documents did not disclose the number of shares pledged.

    The share-backed loans mark a stark contrast with Jack Ma’s positioning just nine months ago when he was originally due to be a beneficiary of Ant’s listing before Beijing stepped on the brakes for what would have been the world’s largest IPO in history.

    Since then, regulators have ordered heavy restructuring for Ant while Alibaba saw its share prices drop one-third alongside a $2.8 billion fine in April over monopolistic practices.

    Ma and his affiliates currently do not have any loans outstanding collateralized by the company’s shares. Tsai’s outstanding share-backed loans were easily manageable with prudent loan-to-value ratios to provide a substantial cushion against a potential margin call.

  • Online share of retail sales jumps to 19% amid lockdowns

    Online share of retail sales jumps to 19% amid lockdowns

    Online sales accounted for nearly a fifth of total retail turnover last year as lockdowns to combat the spread of the coronavirus pandemic fuelled a boom in e-commerce, a United Nations study released on Monday showed.

    Online sales accounted for 19 percent of overall retail sales in 2020, up from 16 percent a year earlier, according to estimates from the UN Conference on Trade and Development (UNCTAD) based on national statistical offices in major economies.

    South Korea reported the highest share at 25.9 percent, up from 20.8 percent the year before. China had a 24.9 percent share, Britain 23.3 percent, and the United States 14.0 percent.

    Global e-commerce sales rose 4 percent to US$26.7 trillion in 2019, according to the latest estimates available, UNCTAD said. This included business-to-business (B2B) and business-to-consumer (B2C) sales, and was equivalent to 30 percent of global economic output that year.

    The pandemic led to mixed fortunes for leading B2C e-commerce companies in 2020, according to the report.

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  • Vietjet to sell 17.7 mln treasury shares

    Vietjet to sell 17.7 mln treasury shares

    The board of budget carrier Vietjet has approved a proposal to sell 17.7 million treasury shares equivalent to 3.28 percent of its charter capital.

    It would help fund expansion and preparations for recovery after the pandemic this year, the airline said.

    Vietjet’s VJC shares closed at VND136,000 ($5.89) on March 8, and at this price the carrier will earn over VND2.4 trillion from the deal.

    It plans to complete the transaction in the first half of this year.

    Vietjet had bought the shares in August 2019 for VND132,063 each. In June 2020, the carrier announced it was seeking to sell them to a strategic investor.

    Vietjet was among the few airlines to make a profit and not fire any employee amid the Covid-19 pandemic last year. It recorded a consolidated after-tax profit of VND70 billion in 2020.

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  • LVMH chairman Bernard Arnault buying stakes in Lagardere

    LVMH chairman Bernard Arnault buying stakes in Lagardere

    LVMH chairman Bernard Arnault will buy a stake in Arnaud Lagardere’s publishing and media group Lagardere Capital & Management (LCM).

    The transaction between the two French billionaires is expected to see Arnault pick up about a quarter of LCM’s share capital, according to a Reuters report.

    Lagardere’s portfolio includes numerous global travel retail stores, many of which are in Asia. In Hong Kong it is in a joint venture with China Duty-Free running key airport concessions for liquor & tobacco and it has a license to roll out the Thai-based Dean & Deluca cafes in airports in Europe and Asia.

    According to a statement released by LVMH and Lagardere, the move is set to “strengthen the corporate structure and financial capacities of LCM”.

    “The family groups led by Bernard Arnault and Arnaud Lagardere will act in concert with regard to Lagardere SCA”.

    Lagardere has recently been resisting attempts by leading shareholder Amber Capital to extend its influence over the firm by replacing the firm’s supervisory board. The moves are partly in response to criticism of the firm for its overly broad range of business interests and flagging stock exchange performance.

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  • Nomura Shares China Brokerage JV Strategy

    Nomura Shares China Brokerage JV Strategy

    Following the relaxation of foreign ownership limits in China, Nomura will seek to launch its joint venture operation in China within 2019 and shares its strategy and view on the market.

    According to Nomura Securities, its new 51 percent-owned joint venture will initially focus on the wealth management business before gradually expanding into other areas such as IPO underwriting, equity and fixed income, M&A and asset management.

    Although we start with wealth management first, that is not our goal. Our goal is to provide wider financial services, said Iiyama Toshiyasu, executive vice-president of Nomura Securities and chairman of its China committee, in a recent report.

    We understand that one business model is not sustainable. We have to combine different areas of business.

    We will start everything from the scratch, Iiyama said, referencing the recent loosening of ownership caps in domestic financial institutions. «China’s opening of the financial sector makes us more confident about what we can do in China and what we can contribute to this market.»

    Iiyama reiterates the importance for foreign financial institutions to focus on importing their unique strengths. In addition to the brokerage JV, Nomura has also gained license as a wholly foreign-owned private fund manager to raise onshore funds and invest in A-shares.

    I believe many international banks will follow suit, Iiyama said. They have their own strength and they will bring that into the Chinese market, which will further broaden and deepen the Chinese market and benefit the Chinese investors and corporations.