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ZTE falls amid concern over Apple lawsuit

ZTE Corp, China's second-largest phone equipment maker, fell the most in six weeks on Monday on concern that Apple's victory in a patent lawsuit against Samsung Electronics Co could hurt other Android phone makers.

Apple won more than $1 billion after a US jury found Samsung infringed six of seven patents for its mobile devices that run Google Inc's Android operating system.

ZTE, based in Shenzhen, became the world's fourth-largest mobile-device seller in the fourth quarter, trailing Nokia Oyj, Samsung and Apple Inc. The company said in January it plans to double smartphone sales this year.

"In the long term, this is negative to all Android phone makers including ZTE, since US operators may become reluctant to buy Android phones unless they can make sure there is no legal risk," said Leping Huang, a telecoms analyst at Nomura International Hong Kong Ltd.

Because ZTE has devices running Microsoft Corp's Windows Phone operating system and will release a model with the Windows 8 Phone system in early 2013, the ruling may make its product portfolio more balanced between Android and Windows Phone, Huang added.

Refiners go overseas to make up for price curb losses

Depressed earnings as a result of State-controlled prices for processed fuels are leading China Petroleum & Chemical Corp, Asia's largest refiner, and rival PetroChina Co to seek more opportunities overseas, according to their latest set of financial figures.

China Petroleum, better known as Sinopec, said refining losses led to a 41 percent decline in first-half net income to 24.5 billion yuan ($3.9 billion) while PetroChina, the nation's biggest oil and gas producer, last week said first-half profit declined 6 percent to 62 billion yuan.

Chinese refiners, which sell gasoline and diesel below cost because the government caps retail prices to contain inflation, said they aren't waiting for the controls to be relaxed, and are now looking overseas to make up the losses.

Sinopec said it would more than double its foreign production by 2015, while PetroChina said it plans to generate more than half its oil and gas output from overseas projects by 2020.

Chinalco to issue new shares through private placement

The Aluminum Corp of China Ltd, or Chinalco, is planning to boost its cash reserves with a new shares issue by private placement.

In a statement to the Shanghai Stock Exchange, the country's biggest aluminum maker said it plans to raise 8 billion yuan ($1.3 billion) by issuing 1.45 billion shares.

It said 2 billion yuan will be used to replenish cash reserves, with the rest being invested in production improvements.

The announcement came after Chinalco reported it lost 3.25 billion yuan in the first half of the year as China's rate of economic growth slowed to a three-year low. From the end of 2009 to the end of June, it lost 6.86 billion yuan in total.

Its financial expenses surged 51.4 percent year-on-year to 2.3 billion yuan in the first six months.

But revenues went up 8.7 percent from a year earlier to 71.7 billion yuan, as it saw a loss of 0.24 yuan per share.

RusAl seeks Chinese partners for joint venture

United Company RusAl, Russia's biggest aluminum producer, is seeking Chinese partners to set up joint venture factories in Siberia, the Jinghua Times newspaper reported on Monday.

The report comes as Hong Kong-traded RusAl signed a Memorandum of Understanding on Saturday with the China Nonferrous Metals Industry Association.

A senior official told the newspaper that a special work team has already been set up to attract Chinese investment in resource-rich Siberia.

The region has one of the world's biggest bauxite mines while the price of electricity, which is essential to turn bauxite into alumina, is cheap. Producing a ton of alumina costs around $1,600 in Siberia, compared with $2,250 in Henan province.

Chinese bank and fund to invest in digital TV in Africa

The China Africa Development Fund and China Development Bank have indicated they plan to invest further in digital TV in the African market.

Speaking at the African Digital TV Development Ministerial Seminar on Sunday, Chi Jianxin, president of the fund, said that since 2007, $100 million has been provided to the development of digital TV on the continent by the fund, and another $50 million is expected in future.

China Development Bank has offered $400 million in loans for the project and another $400 million loan is expected in the near future.

The African digital project was begun by the Beijing-based private media group StarTimes, said the fund president Chi Jianxin.

Some 1.4 million families in 13 African countries now have access to digital television services and the firm has provided about 140 TV channels, according to Pang Xinxing, chairman of StarTimes.

Guangdong to introduce 50,000 new-energy buses

Guangdong province plans to develop its new-energy vehicle industry chain in five years, according to an official document released in connection with the country's 2012-20 Energy-saving and New-Energy Vehicles Development Plan.

The document said that Guangdong will focus on the promotion of new-energy vehicles and provide support to companies contributing to the industry.

The number of new-energy buses in the Pearl River Delta region is expected to reach 50,000 by 2015.

As a leading company in the sector, BYD has been developing its electric bus models in recent years. "The policy will certainly accelerate the development of new-energy vehicles," a BYD official told the Shanghai Securities News. "BYD is likely to have a significant part of market share as we already have mature technology and extensive operating experience."

Beijing supermarkets' profits decrease greatly in H1

Beijing supermarkets saw their profits slide in the first half of the year, marking the first such decrease in nearly three years.

For the first half of 2012, Jingkelong reported revenues of 4.5 billion yuan ($0.71 billion), representing an increase of about 9.6 percent year-on-year. But its 780 million yuan profit was a year-on-year fall of 24.6 percent. Wu-mart, a competitor of Jingkelong, reported having 338 million yuan in net profit in the first half, a slight year-on-year increase of 0.5 percent.

Meanwhile, China Resources Enterprise had 1.44 billion yuan in net profit in the first half, down 3.6 percent year-on-year. And the net profit of Fujian-based Yonghui Supermarket was 193 million yuan in the first half, down 28.57 percent. Meanwhile, CP Lotus reported a loss of 790 million yuan for the period.

"A lot of supermarkets are in Beijing's central business district, where the cost of rent has been increasing quickly," said Li Sheng, deputy director of the China Chamber of Commerce Expert Working Committee. "Besides property, other costs are increasing, such as labor costs."

Ford gets clearance to split China venture with Mazda

Ford Motor Co has received approval from China's top economic planning agency to split its venture in China with Mazda Motor Corp, paving the way for the US automaker to increase control of its expansion in the country.

The National Development and Reform Commission approved an application for Ford to have a separate venture with Chang'an Automobile Co instead of the current three-way ownership structure with Mazda, Ford Chief Executive Officer Alan Mulally told reporters in Chongqing on Monday. The plan still needs to be approved by two ministries, Ford said in a statement.

The separation would restore Ford's ability to have an equal say as its Chinese partner for the first time since 2006, when the US company transferred a 15 percent stake to then-affiliate Mazda. The Dearborn, Michigan-based automaker has sought to break up the China venture after selling down its stake in Mazda in 2008 to raise cash.

Shipbuilding firm enters logistics business

China State Shipbuilding Corporation, one of the country's largest shipbuilding conglomerates, has set up a fully owned logistics subsidiary in Shanghai, according to a statement posted on the company's website.

The new operation, CSSC Logistics Co, is an extension of its purchasing department, and has been set up with registered funds of 320 million yuan ($50 million) to focus on expanding business in sectors including steel, coal and iron ore, according to CSSC.

The new company is expected to achieve annual revenues of 70 billion yuan by the end of 2015, said Chairman Sun Wei, launching the new venture last week.

CBC discusses largest mobile multimedia network

China Broadcast Corp, a Chinese provider of mobile multimedia broadcasting services, said it has built the world's biggest mobile multimedia network, one that offers services to 500 million people, according to its technology and product director.

CBC, which was founded by the State Administration of Radio Film and Television in 2005, operates a national network that allows people to watch TV programs on various devices, including mobile phones, tablets and global positioning systems installed in vehicles.

By June, about 45 million people were subscribing to CBC services offered through China Mobile Multimedia Broadcasting, a homegrown mobile television and multimedia standard, said Wang Letian, technology and product director of CBC, in an interview with cctime.com on Monday.

Performance to determine SME funding applications

Credit finance applications by small and medium-sized enterprises in Zhejiang province will be judged on their previous performance completing government contracts, according to a report by Xinhua News Agency.

The report said in June the local government had established a system of credit ratings for SMEs in the province, and that is being applied to all applications for financing.

The measure, the report said, will be used to score companies, as they apply for funding.

The value of government procurement contracts in Zhejiang province in 2011 totaled 77.8 billion yuan ($12.25 billion) , more than 70 percent of which were signed with SMEs.

HK listing outlook worsens as Everbright pulls deal

China Everbright Bank Co has become the latest company to scrap a first-time share sale in Hong Kong, where listings are on track for the worst year in almost a decade.

Everbright Bank will delay the offering because of "continuous sluggish capital markets and relatively low valuations of banking shares", it said in a statement to the Shanghai Stock Exchange late on Sunday.

The sale could have raised about $1.7 billion, based on the price of Everbright Bank shares traded in Shanghai.

Everbright Bank had already cut the proposed size of the share sale from $6 billion last year. The lender joins companies including London-based diamond retailer Graff Diamonds Corp and Chinese machinery maker Sany Heavy Industry Co in shelving at least $4.8 billion of offerings in Hong Kong this year, data compiled by Bloomberg show.

China Daily - Agencies

(China Daily 08/28/2012 page14)