India, China Fuel Record Asian Stock and Bond Sales (Update1
Enviado: 29/12/2004 7:48India, China Fuel Record Asian Stock and Bond Sales (Update1)
Dec. 29 (Bloomberg) -- China and India fueled record sales of stock and bonds in Asia outside Japan this year, luring investors with the world's fastest economic growth rates.
Asian companies and governments raised $98.6 billion selling debt and equity, setting records for both types of funding, Bloomberg data show. India, which increased the value of sales tenfold, combined with China to account for a third of the total, a trend bankers say will extend into 2005.
``If you have aspirations as a global bank and you're not strong in China and India, you don't really have a very good Asian business,'' said Kenneth Poon, head of Asia Pacific Equity Capital Markets at Citigroup Inc., which ranked first among global debt underwriters in the region this year.
National Thermal Power Corp., State Bank of India Ltd., Air China Ltd. and CNOOC Ltd. were among companies from the world's two most populous nations that raised $31.1 billion selling bonds and shares to fund investment. Last year's tally from the two countries was $9.13 billion.
India's $580 billion economy grew 8.2 percent in the year ending March 31, the fastest pace in 15 years. China's $1.4 trillion economy expanded 9.1 percent in the third quarter, matching its average growth rate for the past decade.
``On what we could see visibly now, India and China seem to be dominating issuance for 2005,'' said Ian Carton, Hong Kong- based head of Asia Capital Markets & Financing at Merrill Lynch & Co., the world's biggest securities firm by capital.
Goldman, Merrill
International sales of stock and equity-linked securities in Asia outside Japan rose by a third this year to $60.4 billion, eclipsing a high set in 2000, Bloomberg data show. Governments and companies sold $38.2 billion of bonds denominated in dollars, euros or yen, surpassing last year's record by 9 percent.
Goldman Sachs Group Inc., the third-biggest securities firm, ranked first among equity and equity-linked underwriters in the region for a third year, handling $10.2 billion of sales, or 17 percent of the market. Its clients included Ping An Insurance Co., China's second-largest life insurer, and National Thermal, India's biggest power company.
National Thermal took two minutes to sell $1.2 billion of shares in its initial public offering in October, according to the Mumbai stock exchange Web site, which published orders from investors as they were placed.
``We anticipated subscription on the first day, but not in the first two minutes,'' said P. Narasimharamalu, director of finance at New Delhi-based National Thermal, which sold global bonds for the first time in March. ``It was a very good sign.''
Indian Sales
DSP Merrill Lynch Ltd., the New York-based firm's India joint venture, ranked first among equity underwriters in the world's second-most populous nation, grabbing 21 percent of the assignments by value. It ranked third in debt underwriting, with a 13 percent share.
DSP Merrill helped the Indian government raise about $2.3 billion from the sale in March of a 10 percent stake in Oil & Natural Gas Corp.
India's benchmark Sensitive index rose 13 percent to a record this year. Net purchases of Indian stocks by overseas investors totaled $8.4 billion as of Dec. 27, surpassing last year's record $7.59 billion.
``That's a dilemma for the government and regulators -- there's too much demand for quality paper,'' said Hemendra Kothari, Mumbai-based chairman of DSP Merrill.
India is planning to sell shares in Power Grid Corp., which transmits 40 percent of the nation's electricity, and Power Finance Corp., a lender to utilities, in 2005. Jet Airways Pvt., India's biggest local airline by market share, may also sell shares next year, Chairman Naresh Goyal said in November.
China Pipeline
In China, Shanghai Automotive Industry Corp. and Dongfeng Motor Corp., carmakers that need funds to compete in the world's fastest-growing auto market, plan to raise as much as $3 billion selling shares next year. China Construction Bank and Bank of China, two of the nation's three biggest lenders, are also preparing to go public.
Jonathan Back, co-head of Asian equity capital markets at JPMorgan Chase & Co., said he expects equity and equity-linked sales from the region to grow by 20 percent to 30 percent next year. JPMorgan led underwriters of equity-linked transactions, this year, helping to sell $2.9 billion of the securities. Including equity sales, the second-biggest U.S. bank ranked fourth in Asia outside of Japan.
Debt sales may also rise next year as companies sell bonds to fund acquisitions and pay maturing debt that was sold before the region's currencies tumbled in 1997, said Rahul Mookerjee, Deutsche Bank AG's co-head of debt capital markets in Asia.
``That trend won't be stopped or diminished by a change in interest rates unless those changes are completely dramatic,'' Mookerjee said. Deutsche Bank ranks second among underwriters of Asian bonds, up from fourth in 2003.
Federal Reserve
The U.S. Federal Reserve raised its benchmark rate on Dec. 14, the fifth increase this year, to 2.25 percent, from 1 percent in June, its lowest in almost 46 years.
Economies in Asia outside Japan will expand by 7.2 percent this year, according to an Asian Development Bank estimate made on Dec. 7. Growth in Asia this year will exceed the 5 percent expansion that the International Monetary Fund is projecting for the world.
``This will ultimately be the largest economic zone in the world, bar none,'' JPMorgan's Back, 38, said.
Below is a Bloomberg League Table ranking banks by the amount of Asian shares, exchangeable and convertible bonds they sold to international investors this year. It excludes Japan, Australia and New Zealand.
Bank Amount Market Share Issues
(US$ Billion)
Goldman Sachs 10.2 16.9% 26
Morgan Stanley 6.65 11.0% 29
Merrill Lynch 5.82 9.6% 28
JPMorgan 5.41 9.0% 30
Citigroup 3.50 5.8% 27
Below is a table ranking banks by the amount of U.S. dollar- , euro and yen-denominated bonds they sold overseas this year for companies and governments in Asia, excluding Japan, Australia and New Zealand.
Bank Amount Market Share Issues
(US$ Billion)
Citigroup 5.27 13.8% 36
Deutsche Bank 5.20 13.6% 31
UBS 4.09 10.7% 29
JPMorgan 3.81 10.0% 21
HSBC 3.30 8.6% 20
Dec. 29 (Bloomberg) -- China and India fueled record sales of stock and bonds in Asia outside Japan this year, luring investors with the world's fastest economic growth rates.
Asian companies and governments raised $98.6 billion selling debt and equity, setting records for both types of funding, Bloomberg data show. India, which increased the value of sales tenfold, combined with China to account for a third of the total, a trend bankers say will extend into 2005.
``If you have aspirations as a global bank and you're not strong in China and India, you don't really have a very good Asian business,'' said Kenneth Poon, head of Asia Pacific Equity Capital Markets at Citigroup Inc., which ranked first among global debt underwriters in the region this year.
National Thermal Power Corp., State Bank of India Ltd., Air China Ltd. and CNOOC Ltd. were among companies from the world's two most populous nations that raised $31.1 billion selling bonds and shares to fund investment. Last year's tally from the two countries was $9.13 billion.
India's $580 billion economy grew 8.2 percent in the year ending March 31, the fastest pace in 15 years. China's $1.4 trillion economy expanded 9.1 percent in the third quarter, matching its average growth rate for the past decade.
``On what we could see visibly now, India and China seem to be dominating issuance for 2005,'' said Ian Carton, Hong Kong- based head of Asia Capital Markets & Financing at Merrill Lynch & Co., the world's biggest securities firm by capital.
Goldman, Merrill
International sales of stock and equity-linked securities in Asia outside Japan rose by a third this year to $60.4 billion, eclipsing a high set in 2000, Bloomberg data show. Governments and companies sold $38.2 billion of bonds denominated in dollars, euros or yen, surpassing last year's record by 9 percent.
Goldman Sachs Group Inc., the third-biggest securities firm, ranked first among equity and equity-linked underwriters in the region for a third year, handling $10.2 billion of sales, or 17 percent of the market. Its clients included Ping An Insurance Co., China's second-largest life insurer, and National Thermal, India's biggest power company.
National Thermal took two minutes to sell $1.2 billion of shares in its initial public offering in October, according to the Mumbai stock exchange Web site, which published orders from investors as they were placed.
``We anticipated subscription on the first day, but not in the first two minutes,'' said P. Narasimharamalu, director of finance at New Delhi-based National Thermal, which sold global bonds for the first time in March. ``It was a very good sign.''
Indian Sales
DSP Merrill Lynch Ltd., the New York-based firm's India joint venture, ranked first among equity underwriters in the world's second-most populous nation, grabbing 21 percent of the assignments by value. It ranked third in debt underwriting, with a 13 percent share.
DSP Merrill helped the Indian government raise about $2.3 billion from the sale in March of a 10 percent stake in Oil & Natural Gas Corp.
India's benchmark Sensitive index rose 13 percent to a record this year. Net purchases of Indian stocks by overseas investors totaled $8.4 billion as of Dec. 27, surpassing last year's record $7.59 billion.
``That's a dilemma for the government and regulators -- there's too much demand for quality paper,'' said Hemendra Kothari, Mumbai-based chairman of DSP Merrill.
India is planning to sell shares in Power Grid Corp., which transmits 40 percent of the nation's electricity, and Power Finance Corp., a lender to utilities, in 2005. Jet Airways Pvt., India's biggest local airline by market share, may also sell shares next year, Chairman Naresh Goyal said in November.
China Pipeline
In China, Shanghai Automotive Industry Corp. and Dongfeng Motor Corp., carmakers that need funds to compete in the world's fastest-growing auto market, plan to raise as much as $3 billion selling shares next year. China Construction Bank and Bank of China, two of the nation's three biggest lenders, are also preparing to go public.
Jonathan Back, co-head of Asian equity capital markets at JPMorgan Chase & Co., said he expects equity and equity-linked sales from the region to grow by 20 percent to 30 percent next year. JPMorgan led underwriters of equity-linked transactions, this year, helping to sell $2.9 billion of the securities. Including equity sales, the second-biggest U.S. bank ranked fourth in Asia outside of Japan.
Debt sales may also rise next year as companies sell bonds to fund acquisitions and pay maturing debt that was sold before the region's currencies tumbled in 1997, said Rahul Mookerjee, Deutsche Bank AG's co-head of debt capital markets in Asia.
``That trend won't be stopped or diminished by a change in interest rates unless those changes are completely dramatic,'' Mookerjee said. Deutsche Bank ranks second among underwriters of Asian bonds, up from fourth in 2003.
Federal Reserve
The U.S. Federal Reserve raised its benchmark rate on Dec. 14, the fifth increase this year, to 2.25 percent, from 1 percent in June, its lowest in almost 46 years.
Economies in Asia outside Japan will expand by 7.2 percent this year, according to an Asian Development Bank estimate made on Dec. 7. Growth in Asia this year will exceed the 5 percent expansion that the International Monetary Fund is projecting for the world.
``This will ultimately be the largest economic zone in the world, bar none,'' JPMorgan's Back, 38, said.
Below is a Bloomberg League Table ranking banks by the amount of Asian shares, exchangeable and convertible bonds they sold to international investors this year. It excludes Japan, Australia and New Zealand.
Bank Amount Market Share Issues
(US$ Billion)
Goldman Sachs 10.2 16.9% 26
Morgan Stanley 6.65 11.0% 29
Merrill Lynch 5.82 9.6% 28
JPMorgan 5.41 9.0% 30
Citigroup 3.50 5.8% 27
Below is a table ranking banks by the amount of U.S. dollar- , euro and yen-denominated bonds they sold overseas this year for companies and governments in Asia, excluding Japan, Australia and New Zealand.
Bank Amount Market Share Issues
(US$ Billion)
Citigroup 5.27 13.8% 36
Deutsche Bank 5.20 13.6% 31
UBS 4.09 10.7% 29
JPMorgan 3.81 10.0% 21
HSBC 3.30 8.6% 20