Emerging Market Links + The Week Ahead (March 20, 2023)
AI CEO helps a stock beat the Hong Kong market, SVB's fallout hits Latin American startups, India valuations fair, Mexico targets Vulcan Materials, MTN, and the week ahead for emerging markets.
Activist fund managers take note: A stock with an AI CEO appointed last August has outperformed the Hong Kong market. And not only does this AI CEO work 24/7, she (as the article is using the “she” pronoun) earns ZERO in compensation. If only Silicon Valley Bank had some AI intelligence - either as executives or on it’s politically connected Board…
Meanwhile, the fallout from SVB’s collapse continues and is hitting Latin American start-ups who were forced by their American VCs to bank there. However, India appears to be getting spared while one wealth manager also thinks Indian valuations are fair as they have corrected from 22 times to 18 times (price-to-earnings ratio) now. He argues India should trade at a higher valuation than pre-covid levels.
Finally, video has just surfaced of the Mexican military (along with vehicles with CEMEX logos) seizing the port facilities of Alabama based Vulcan Materials (NYSE: VMC). The Company has a $170 million joint venture in Mexico consisting of a large quarry and deep water seaport on the Yucatán Peninsula just south of Cancun. This quarry supplies Tampa, New Orleans, Houston, and Brownsville, Texas, as well as other Gulf coast seaports, with crushed limestone via large 62,000-ton self-discharging ships.
Apparently, the Company has been in NAFTA arbitration with Mexico since late 2018 regarding its investments there. However, critics are already saying its another negative example of how President “AMLO” treats foreign investors.
Suggested Reading
$ = behind a paywall
Should we automate the CEO? (theHUSTLE)
Last August, NetDragon Websoft (HKG: 0777 / FRA: 3ND) — a Hong Kong-based online gaming firm with $2.1B in annual revenue — appointed a CEO to helm its flagship subsidiary.
The new chief, Tang Yu, was responsible for all of the typical duties of a company figurehead: reviewing high-level analytics, making leadership decisions, assessing risks, and fostering an efficient workplace.
She worked 24/7, didn’t sleep, and was compensated $0 per year.
But there was a catch: Yu wasn’t a human. She was a virtual robot powered by artificial intelligence.
So far, having an AI CEO hasn’t had any catastrophic consequences for NetDragon Websoft. In fact, since Yu’s appointment, the company has outperformed Hong Kong’s stock market.
India valuations fair amid global turmoil, says Gohil of Credit Suisse wealth (money control)
NOTE: Not sure if I agree with his other take - “The SVB crisis is unlikely to turn into a contagion in the US and the Federal Reserve will need to respond to inflation by hiking the policy rate by at least 25 basis points, said Jitendra Gohil of Credit Suisse Wealth…”
Most Funds seem to think the overall Indian market is pricey now…:
Indian markets are generally viewed as expensive versus their EM counterparts. Do valuations look reasonable now?
So, the valuation has already been corrected from 22 times to 18 times (price-to-earnings ratio) now. We have been very vocal that India should trade at a higher valuation than pre-covid levels. The average valuation for pre-covid is somewhere near 16.5. India’s fundamentals are far superior to what they were before the Covid pandemic. One reason is the government balance sheet has improved dramatically, and the budget has become more transparent. Second, corporate balance sheets have improved dramatically. Third, our banking system was in the doldrums before covid but NPL (non-performing loans) ratios have come down. In fact, this is going to improve in the next couple of years. So, I think all these points towards India being able to command a better valuation compared to historic levels.
The argument is that why not sell India and invest in other cheaper markets? But funds hold so much of other markets, the value of their India holdings is near a 10-year low. Our weight in the MSCI Emerging Market Index has gone higher, almost doubled. We have seen that in the past that FPIs (foreign portfolio investors) have come to India at around 18,000 levels when they were selling at 16,000. I think 17 times the PE ratio is a decent number where we are currently, and there is not a major downside from here. In the second half of this year, there will be a lot of clarity in terms of how the Fed is going to behave. There could be more tailwinds coming in after June. We might see more supportive arguments for equity as earnings would catch up to justify the higher level of valuation.
Silicon Valley Bank ‘contagion’ may leave India unscathed (The Hindu)
If ‘contagion effects’ from SVB or higher interest rates hit more foreign banks, a flight to safety among global investors could hit capital flows into emerging markets like India and impact the rupee, officials say.
Investors told Latin American startups to bank with SVB. Then it collapsed (Rest of World)
Vega [co-founder of Platzi, a Colombian edtech platform], along with many other entrepreneurs, investors, and legal experts Rest of World spoke to, said that for years, startups from emerging markets have been compelled by venture capital firms (VCs) to open bank accounts in the U.S. as a condition to obtain investor money. SVB was virtually the only bank willing to serve these young, foreign startups with little to no business history. With the demise of SVB, these foreign founders ended up entangled in a bank run reminiscent of the ones investors had feared they’d face in their home countries.
Considering the recent history of bank runs in Latin America — including Argentina’s ongoing financial crisis, triggered after banks froze access to accounts in December 2001, and the Mexican shadow bank collapse in 2022 — investors saw U.S. banks as relatively more stable. “What is more likely: for a big bank to go down in Mexico or in Silicon Valley?” Daniel Bilbao, CEO and co-founder of Truora, a digital identity provider based in Colombia, said to Rest of World. Despite the bank run on SVB, where his company also holds deposits, Bilbao is confident that “the U.S. remains a safer place.”
But according to other entrepreneurs, in this case, Latin American banks did actually rise to the occasion. “Several banks in Colombia and Mexico set up quick arrangements to help us get transfers from SVB,” said Truora’s Bilbao, who managed to withdraw his money from SVB at the 11th hour. “We learned that startups need relationships with several well-established banks to operate, both in Latin America and in the U.S.”
The long-term fallout from SVB’s collapse sparks fear in many founders and investors across the world’s emerging tech sectors, according to García Osuna. Without a bank so willing and able to open accounts for foreign startups, few will be able to provide VCs the structure they say they require to make investments outside the U.S. Even after the Fed’s announcement, “VCs will be much more reluctant to invest in Latin America. We’ll probably see less investment in the next two months,” said [Gerardo] Macías [managing partner at Astelaris, a consulting firm for startups based in Monterrey.]
Latin American tech startups scramble after SVB collapse (Reuters)
"This touched (almost all) venture-backed companies in Latin America," said Brian Requarth, the Mexico City-based co-founder of startup platform Latitud.
In 2022, more than 1,300 startups in Latin America raked in an estimated $28.17 billion in funding, according to the Association for Private Capital Investment in Latin America.
Startups would open SVB accounts using what Requarth called a "Cayman sandwich," using holding companies in the Cayman Islands and limited liability companies (LLCs) in the U.S. state of Delaware to avoid a taxation double whammy if the firm was ever sold.
Mexico seizes Vulcan Materials port facility: Britt calls move ‘unlawful and unacceptable’ (AL.com)
Vulcan said in a statement to AL.com that the company has been in NAFTA arbitration with Mexico since late 2018 regarding its investments there, including the Sac-Tun (Calica) limestone quarry near Playa del Carmen.
The Mexican government in 2022 said it was negotiating the settlement of a $1.1 billion lawsuit by Vulcan over an effort to shutter that quarry, Reuters has reported. The status of that suit was not known Sunday night.
Lopez Obrador has accused the company of extracting materials without the proper permits, Bloomberg news reported.
The outlook for emerging markets (FT Adviser)
In this guide
Emerging Market Stock Picks / Stock Research
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Special Situations Update (The Superinvestors of Augustusville Substack)
Far Ltd (ASX: FAR / OTCMKTS: FARYF)
Far Ltd. is an idea that was pitched by Jeremy Raper here and here . Far is a small Australian Oil company with assets in Africa (Gambia, Senegal). The company’s assets consist of (1) Cash (33.7mm USD per 31/12), (2) the Right to receive a Contingent Payment linked to the Sangomar field in Senegal. This payment is up to 55m USD, linked to oil prices and production and the field is expected to produce from H2 2023, (3) rights in two blocks in Gambia which the company is trying to monetize. The assets could be worth 75mm USD (112 mm AUD) in a liquidation scenario, much more than the current market cap of 70mm AUD. The company is returning cash by way of buybacks and has so far repurchsed 4% of the float this. There is some risk if oil prices were to collapse in a deep recession scenario.
MTN shares plunge 12% despite strong annuals as group cuts SA business outlook due to power crisis (IOL)
NOTE: MTN (JSE: MTN) has the largest fixed and mobile network in Africa and otherwise seems to be weathering South Africa’s blackouts.
MTN shares hit an intraday low of R123.53 on the JSE despite the diversified telcoms group reporting strong annuals for the year ended December 31, 2022, and also in spite of the group saying it planned to spend R9 billion on its South African network.
MTN revised its targeted core profit margin guidance for South Africa down to 37% from 39%, from 39% to 42% previously, due to higher-than-expected power costs, increased hubs and switches costs as a result of load shedding, higher network security and resilience costs, as well as a reassessment management fee agreement with the group.
Power outage costs were R695 million, or 3.4%, of MTN South Africa's earnings before interest, taxes, depreciation, and amortisation (Ebitda).
Xylem: Strong Competitive Moat With Tailwinds From Green Transition (Seeking Alpha)
Xylem Inc (NYSE: XYL) has a strong competitive moat in the water industry as a result of a differentiated, innovative, end-to-end portfolio of products.
The company has an impressive track record of innovation for many decades, as the company has many instances where it's the first to introduce an innovative concept to the industry.
Xylem's strong digital offering has resulted in its share of revenue growing from 16% in 2016 to 50% by 2025.
Emerging markets remain a huge opportunity for Xylem, as its products and solutions can help address their water challenges.
I think that Xylem's current valuation is fair, with a potential to enter the stock at a more reasonable valuation as a result of its commercial and industrial exposures.
Standing strong: Nestle’s affordable products strategy boosts emerging market growth (FoodNavigator Europe)
NOTE: Emerging markets may up 42% of Nestle (SWX: NESN / OTCMKTS: NSRGY / OTCMKTS: NSRGF) business. In addition: Nestle India (NSE: NESTLEIND) / Nestle (Malaysia) Berhad (KLSE: NESTLE):
Nestle’s strategy to focus on product affordability and accessibility appears to have paid off in 2022, with the firm seeing more significant growth from its business in emerging markets even amid inflationary and economic turbulence.
Earnings Calendar
Note: Investing.com has a full calendar for most global stock exchanges BUT you may need an Investing.com account, then hit “Filter,” and select the countries you wish to see company earnings from. Otherwise, purple (below) are upcoming earnings for US listed international stocks (Finviz.com):
Economic Calendar
Click here for the full weekly calendar from Investing.com containing frontier and emerging market economic events or releases (my filter excludes USA, Canada, EU, Australia & NZ).
Election Calendar
Frontier and emerging market highlights (from IFES’s Election Guide calendar):
Kazakhstan Kazakh House of Representatives Mar 19, 2023 (d) Confirmed Jan 10, 2021
Turkmenistan Turkmen National Assembly Mar 31, 2023 (t) Date not confirmed Mar 25, 2018
Bulgaria Bulgarian National Assembly Apr 2, 2023 (d) Confirmed Oct 2, 2022
Paraguay Paraguayan Chamber of Senators Apr 30, 2023 (d) Confirmed Apr 22, 2018
Paraguay Presidency of Paraguay Apr 30, 2023 (d) Confirmed Apr 22, 2018
Paraguay Paraguayan Chamber of Deputies Apr 30, 2023 (d) Confirmed Apr 22, 2018
Thailand Thai House of Representatives May 7, 2023 (t) Date not confirmed Mar 24, 2019
Turkey Grand National Assembly of Turkey May 14, 2023 (d) Confirmed Jun 24, 2018
Turkey Presidency of Turkey May 14, 2023 (d) Confirmed Jun 24, 2018
Greece Greek Parliament Jun 8, 2023 (t) Date not confirmed Jul 7, 2019
Cambodia Cambodian National Assembly Jul 23, 2023 (d) Confirmed Jul 29, 2018
Pakistan Pakistani National Assembly Jul 31, 2023 (t) Date not confirmed Jul 25, 2018
Zimbabwe Presidency of Zimbabwe Jul 31, 2023 (t) Date not confirmed Jul 30, 2018
Zimbabwe Zimbabwean National Assembly Jul 31, 2023 (t) Date not confirmed Jul 30, 2018
Emerging Market IPO Calendar/Pipeline
Frontier and emerging market highlights from IPOScoop.com and Investing.com (NOTE: For the latter, you need to go to Filter and “Select All” countries to see IPOs on non-USA exchanges):
U Power Ltd.UCAR AMTD, 2.5M Shares, $6.00-8.00, $17.5 mil, 3/20/2023 Week of
We are an electric vehicle (EV) battery-swapping technology company. (Holding company incorporated in the Cayman Islands)
We are a vehicle sourcing service provider in China, with a vision to becoming an EV market player primarily focused on our proprietary battery-swapping technology, or UOTTA technology, which is an intelligent modular battery-swapping technology designed to provide a comprehensive battery power solution for EVs.
Since our commencement of operations in 2013, we have principally engaged in the provision of vehicle sourcing services. We broker sales of vehicles between automobile wholesalers and buyers, including small and medium sized vehicle dealers (“SME dealers”) and individual customers primarily located in the lower-tier cities in China, which are smaller and less developed than the tier-1 or tier-2 cities. To that end, we have focused on building business relationships with our sourcing partners and have developed a vehicle sourcing network. As of the date of this prospectus, our vehicle sourcing network consisted of approximately 100 wholesalers and 30 SME dealers located in lower-tier cities in China.
Beginning in 2020, we gradually shifted our focus from the vehicle sourcing business to the development of our proprietary battery-swapping technology, or UOTTA technology. According to Frost & Sullivan, the PRC government will focus on promoting the electrification of commercial vehicles in the next few years, and it is expected that the sales volume of electric commercial vehicles will grow from 164.7 thousand units in 2021 to 431.0 thousand units in 2026 at a CAGR of 21.2% in China, and with the increasing penetration rates of electric commercial vehicles and the expanding battery-swapping infrastructure network, the market size by revenue of battery swapping solutions for electric commercial vehicle is expected to increase from approximately RMB8,661.5 million in 2021 to RMB176,615.1 million in 2026, representing a CAGR of 82.8%. In order to capture the opportunities arising from such growth, our plan is to develop a comprehensive EV battery power solution based on UOTTA technology, which mainly consists of: (i) vehicle-mounted supervisory control units that monitor the real-time status of an EV’s battery packs; (ii) customized vehicle control units (“VCUs”), which upload real-time data of the electric vehicle, such as its battery status, real-time location and safety status, to our data platform, using Bluetooth and/or Wi-Fi technologies; and (iii) our data management platform, which collects and synchronizes real-time information of the EVs uploaded by their respective VCUs, as well as information on the availability and locations of compatible UOTTA battery-swapping stations that assist drivers in locating the nearest compatible UOTTA battery-swapping station(s) available when the EV’s battery is determined to be lower than a certain level; and (iv) UOTTA battery-swapping stations designed for precise positioning, rapid disassembly, compact integration and flexible deployment of battery swapping for compatible EVs.
We have established in-house capabilities in the innovation of EV battery-swapping technology. Through our research and development efforts, we are developing an intellectual property portfolio. As of the date of this prospectus, we had 14 issued patents and 24 pending patent applications in China. Our research and development team is committed to technology innovation. As of the date of the prospectus, our research and development team consisted of 34 personnel and is led by Mr. Rui Wang and Mr. Zhanduo Hao, each of whom has experience of over 20 years in the electric power sector.
In 2021, leveraging years of automobile industry experience, we started cooperating with major automobile manufactures to jointly develop UOTTA-powered EVs, by adapting selected EV models with our UOTTA technology. According to Frost & Sullivan, compared with passenger EV drivers, drivers of commercial-use EVs experience more range anxiety and are more motivated to shorten, or even eliminate, time spent on recharging EVs, therefore, we intend to primarily focus on developing commercial-use UOTTA-powered EVs, such as ride-hailing passenger EVs, small logistics EVs, light electric trucks, and heavy electric trucks, and their compatible UOTTA battery-swapping stations. As of the date of this prospectus, we have entered into cooperating agreements with two major Chinese automobile manufacturers, FAW Jiefang Qingdao Automotive Co., Ltd, and HUBEI TRI-RING Motor Co., Ltd, to jointly develop UOTTA-powered electric trucks. We also have engaged with two battery-swapping station manufactures to jointly develop and manufacture UOTTA battery-swapping stations that are compatible with UOTTA-powered EVs. Our UOTTA battery-swapping stations are designed for precise positioning, rapid disassembly, compact integration and flexible deployment, allowing battery replacement within several minutes. As of the date of this prospectus, we realized sales of five battery-swapping stations. In August 2021, we completed the construction of our own battery-swapping station factory in Zibo City, Shandong Province (the “Zibo Factory”), which commenced manufacturing UOTTA battery-swapping stations in January 2022. We are also in the process of constructing another factory in Wuhu city, Anhui province (the “Wuhu Factory”), which is expected to commence production in 2023. In order to provide a comprehensive battery power solution based on UOTTA technology, we are in the process of developing a data management platform that connects UOTTA-powered EVs and stations, and assists the UOTTA-powered EV drivers in locating the closest compatible UOTTA swapping-stations on their routes. In January 2022, we started operating a battery-swapping station, pursuant to our station cooperation agreement with Quanzhou Xinao Transportation Energy Development Co., Ltd (“Quanzhou Xinao”), a local gas station operator in Quanzhou City, Fujian Province. Although we have made significant progress in entering into the EV market, there is no assurance that we will be able to execute our business plan to expand into the EV market as we have planned.
**Note: U Power Ltd. reported a net loss of $6.84 million on revenue of $1.75 million for the 12 months that ended June 30, 2022.
(Note: U Power Ltd. disclosed terms for its IPO on March 8, 2023, n an F-1/A filing: 2.5 million shares at $6.00 to $8.00 to raise $17.5 million. U Power Ltd. filed its F-1 on Dec. 22, 2022, and updated the filing with an F-1/A on Feb. 14, 2023 – without disclosing terms for its IPO.)
Golden Heaven Group Ltd. GDHG, 2.0M Shares, $4.00-5.00, $9.0 mil, 3/21/2023 Tuesday
Note: Investors in our ordinary shares (in the IPO) are purchasing equity interests in the Cayman Islands holding company, and not in the Chinese operating entities.
We are a Cayman Islands holding company and conduct our operations in China through Nanping Golden Heaven Amusement Park Management Co., Ltd. (“Golden Heaven WFOE”) and its subsidiaries. We hold 100% equity interests in our PRC subsidiaries, and we do not use a VIE structure.Through our subsidiaries, we operate six amusement parks and water parks in southern China.
As of the date of this prospectus, Golden Heaven WFOE has acquired 100% equity interests in the following PRC subsidiaries: (i) Changde Jinsheng Amusement Development Co., Ltd. (“Changde Jinsheng”), (ii) Qujing Jinsheng Amusement Investment Co., Ltd. (“Qujing Jinsheng”), (iii) Tongling Jinsheng Amusement Investment Co., Ltd. (“Tongling Jinsheng”), (iv) Yuxi Jinsheng Amusement Development Co., Ltd. (“Yuxi Jinsheng”), (v) Yueyang Jinsheng Amusement Development Co., Ltd. (“Yueyang Jinsheng”), and (vi) Mangshi Jinsheng Amusement Park Co., Ltd. (“Mangshi Jinsheng”).
Our corporate headquarters is in Yanping District, Nanping City, Fujian Province, China. According to government authorities in Fujian Province, Yanping District is known as “the birthplace of Chinese amusement park industry” and entrepreneurs from Yanping District have expanded beyond Yanping District and established their presence all across China. Through the operating entities, we are a leading amusement park operator in Yanping District and an active player in developing the Chinese amusement park industry. We aim to become the leading regional amusement park operator in China.
The parks of the operating entities occupy approximately 426,560 square meters of land in the aggregate and are located in geographically diverse markets across the south of China. Due to the geographical locations of the parks and the ease of travel, the parks are easily accessible to an aggregate population of approximately 21 million people. The parks offer a broad selection of exhilarating and recreational experiences, including both thrilling and family-friendly rides, water attractions, gourmet festivals, circus performances, and high-tech facilities. As of the date of this prospectus, the parks collectively contain 139 rides and attractions.
Our revenue is primarily generated from the Chinese operating entities’ selling access to rides and attractions, charging fees for special event rentals, and collecting regular rental payments from commercial tenants.
**Note: Revenue and net income figures are in U.S. dollars for the fiscal year that ended Sept. 30, 2022.
(Note: Golden Heaven Group Ltd. filed an F-1/A dated March 2, 2023, in which it slashed the size of its IPO to 2.0 million ordinary shares – down from 6.0 million shares – and kept the price range at $4.00 to $5.00 – to raise $9.0 million. Under the new terms, Golden Heaven Group’s IPO will raise $18 million less than under its original terms – a cut of 67 percent in the estimated IPO proceeds. Golden Heaven Group Ltd. filed an F-1/A on Feb. 17, 2023, and disclosed the terms for its IPO: 6.0 million ordinary shares at $4,00 to $5.00 to raise $27.0 million. Golden Heaven Group also updated its financial statements in the Feb. 17, 2023, F-1/A filing to include its revenue and net income for the fiscal year that ended Sept. 30, 2022. Background: Golden Heaven Group filed its F-1 on Nov. 4, 2022; it submitted confidential IPO documents to the SEC on June 22, 2022.)
YanGuFang International Group Co., Ltd. YGF, 2.5M Shares, $4.00-6.00, $12.5 mil, 3/21/2023 Tuesday
We are a data- and technology-driven property technology company based in Singapore. Through our subsidiaries, we operate a one-stop-shop property platform which provides end-to-end property solutions and services for our customers, which comprises brokerage services and emerging and other services, such as home renovation and furnishing services, listing and research, mortgage referral, legal services and insurance referral services. We operate on a data-driven customer-centric business model and through our platform, we seek to provide a comprehensive suite of property solutions and services to aid our customers in every step of their property transaction journey, with the objective of making property transactions and related services simple, efficient and affordable for all.
Since the incorporation of our subsidiary, Ohmyhome (S), in 2015 and the commencement of our business operations in 2016, our platform has facilitated over 4,400 agent brokerage transactions and other property-related services and over 7,200 self-transacted online property transactions, with an aggregate GTV of over US$2.5 billion as of July 31, 2022, making us one of Singapore’s largest integrated property transactions and services platform, according to Frost & Sullivan. We operate our Ohmyhome platform in Singapore and Malaysia. Today, Ohmyhome has been ranked Singapore’s top mobile application for property listings and transactions by customer ratings and is a leading one-stop property platform for property transactions and property-related services, according to Frost & Sullivan.
Our platform appeals to and supports a growing online community and network of users looking to list and search for properties online, seeking information on their property transactions and other value-added services, through the comprehensive property-related solutions and services available on our platform. As at July 31, 2022, we have over 250,000 monthly active users on our online website and mobile application, and over 650,000 downloads of our mobile application. Our website also receives a weekly average of over 150,000 unique visitors and a weekly average of over 280,000 website visits. As at July 31, 2022, our platform contained over 20,000 active listings for residential properties for sale and rental on a monthly basis. An active listing refers to a listing where the property of the subject listing is still on the market for sale or for lease. Each listing has an expiration date of 30 days from the date of the listing and listing owners will have to renew the listing before its expiry to keep the listing active for another 30 days. In the event where a listing has reached its expiry or is indicated as sold or leased as the case may be, such listing would be removed and will no longer be searchable by the public unless a new listing has been created.
**Note: Revenue and net loss figures are for the 12 months that ended June 30, 2022.
(Note: Ohmyhome Ltd. changed its sole book-runner to Prime Number Capital – from Spartan Capital Securities – in an F-1/A filing dated March 6, 2023. On Dec. 6, 2022, Ohmyhome Ltd. filed its F-1 and disclosed terms for its IPO: 3.25 million shares at $4.00 to $5.00 to raise $14.63 million.)
Shengfeng Development Ltd. SFWL, 3.0M Shares, $4.00-5.00, $13.5 mil, 3/23/2023 Thursday
Note: From the prospectus – Shengfeng Development Limited is a holding company incorporated in the Cayman Islands exempted company. This is an IPO of the Class A ordinary shares of the offshore holding company in the Cayman Islands. Its operations are conducted through its subsidiary in China, the VIE, and the VIE’s subsidiaries. You are not investing in Shengfeng Logistics, the VIE, or the VIE’s subsidiaries.
The VIE is one of the leading contract logistics service providers in China. Since the establishment of the VIE in 2001, our mission has been to provide logistics solutions to companies in need of storage and delivery assistance in China. Through our experienced management team, we apply our well-established management system and operation procedures to assist companies in China to increase efficiency and improve their own management systems with respect to transportation, warehousing and time management. We aim to provide our clients with superior and customized services. Our business slogan is “When you entrust us with your goods, we cherish them as our own.”
Contract logistics is a comprehensive process that merges traditional logistics with supply chain management. Contract logistics companies outsource resource management tasks to third-party companies and handle activities such as planning and designing supply chains, designing facilities, processing orders, collecting payments, managing inventories, and providing client services.
The contract logistics industry in China has been expanding in recent years. According to Frost & Sullivan, since 2019, the market size of the contract logistics industry has reached RMB1,154.9 billion and is expected to reach RMB1,709.9 billion by 2024. We are a China-based, business-to-business, or “B2B,” independent contract logistics company with consolidated revenue of approximately $346.7 million and $287.5 million for the fiscal years ended Dec. 31, 2021, and 2020, respectively. Based on the report provided by Frost & Sullivan, in 2020 and 2019, the VIE ranked top 50 among all B2B independent contract logistics companies in China.
Our integrated logistics solution services are comprised of three segments: (1) B2B freight transportation; (2) cloud storage; and (3) value-added services. Since 2001, we, through the VIE and the VIE’s subsidiaries, have developed extensive and reliable transportation networks in China, covering 341 cities in over 31 provinces as of Dec. 31, 2021. In addition, we, through the VIE and the VIE’s subsidiaries, have provided services to over 4,000 manufacturers and trading companies in China, including companies such as CATL Battery, Bright Dairy, SF Express, Schneider Electric, and Xiaomi.
**Note: Revenue and net income figures are for the 12 months that ended June 30, 2022.
(Note: Shengfeng Development Ltd. cut the size of its IPO to 3.0 million shares – down from 5.0 million shares – at a price range of $4.00 to $5.00 – to raise $13.5 million, according to an F-1/A filing dated Feb. 17, 2023. The new terms represent a 46 percent reduction in the IPO’s size. Shengfeng Development Ltd. also updated its financial statements through June 30, 2022, in its F-1/A filing on Feb. 17, 2023.)
(Background on previous filings: Shengfeng Development Ltd. cut the size of its IPO to 5.0 million shares – down from 8.0 million shares initially – and set the assumed IPO price at $5.00 – the top of its previous $4.00-to-$5.00 range – to raise $25.0 million (down from $36.0 million initially) in an F-1/A filing dated Jan. 25, 2023. Shengfeng Development also disclosed its proposed symbol – SFWL – for its NASDAQ listing in its F-1/A filing on Jan. 25, 2023. Shengfeng Development Ltd. filed its F-1 on Sept. 9, 2022, taking the unusual step of setting terms for its IPO at the same time – 8.0 million Class A ordinary shares at $4.00 to $5.00 to raise $36.0 million. This is a NASDAQ listing.)
Emerging Market ETF Launches
Climate change and ESG are clearly the latest flavours of the month for most new ETFs. Nevertheless, here are some new frontier and emerging market focused ETFs:
1/31/2023 - Strive Emerging Markets Ex-China ETF STX - Passive, equity, emerging markets
1/20/2023 - Putnam PanAgora ESG Emerging Markets Equity ETF PPEM - Active, equity, ESG, emerging markets
1/12/2023 - KraneShares China Internet and Covered Call Strategy ETF KLIP - Active, equity, China, options overlay, thematic
1/11/2023 - Matthews Emerging Markets ex China Active ETF MEMX - Active, equity, emerging markets
12/13/2022 - GraniteShares 1.75x Long BABA Daily ETF BABX - Active, equity, leveraged, single stock
12/13/2022 - Virtus Stone Harbor Emerging Markets High Yield Bond ETF VEMY - Active, fixed income, junk bond, emerging markets
9/22/2022 - WisdomTree Emerging Markets ex-China Fund XC - Passive, equity, emerging markets
9/15/2022 - KraneShares S&P Pan Asia Dividend Aristocrats Index ETF KDIV - Passive, equity, Asia, dividend strategy
9/15/2022 - OneAscent Emerging Markets ETF OAEM - Active, Equity, emerging markets, ESG
9/9/2022 - Emerge EMPWR Sustainable Select Growth Equity ETF EMGC - Active, equity, emerging markets
9/9/2022 - Emerge EMPWR Unified Sustainable Equity ETF EMPW - Active, equity, emerging markets
9/8/2022 - Emerge EMPWR Sustainable Emerging Markets Equity ETF EMCH - Active, equity, emerging markets, ESG
7/14/2022 - Matthews China Active ETF MCH - Active, equity, China
7/14/2022 - Matthews Emerging Markets Equity Active ETF MEM - Active, equity, emerging markets
7/14/2022 - Matthews Asia Innovators Active ETF MINV - Active, equity, Asia
6/30/2022 - BondBloxx JP Morgan USD Emerging Markets 1-10 Year Bond ETF XEMD - Passive, fixed income, emerging markets
5/2/2022 - AXS Short CSI China Internet ETF SWEB - Active, inverse, thematic
4/27/2022 - Dimensional Emerging Markets High Profitability ETF DEHP - Active, equity, emerging markets
4/27/2022 - Dimensional Emerging Markets Core Equity 2 ETF DFEM - Active, equity, emerging markets
4/27/2022 - Dimensional Emerging Markets Value ETF DFEV - Active, equity, emerging markets
4/27/2022 - iShares Emergent Food and AgTech Multisector ETF IVEG - Passive, equity, thematic [Mostly developed markets]
4/21/2022 - FlexShares ESG & Climate Emerging Markets Core Index Fund FEEM - Passive, equity, ESG
4/6/2022 - India Internet & Ecommerce ETF INQQ - Passive, equity, thematic
2/17/2022 - VanEck Digital India ETF DGIN - Passive, India market, thematic
2/17/2022 - Goldman Sachs Access Emerging Markets USD Bond ETF GEMD - Passive, fixed income, emerging markets
1/27/2022 - iShares MSCI China Multisector Tech ETF TCHI - Passive, China, technology
1/11/2022 - Simplify Emerging Markets PLUS Downside Convexity ETF EMGD - Active, equity, options strategy
1/11/2022 - SPDR Bloomberg SASB Emerging Markets ESG Select ETF REMG - Passive, equity, ESG
Emerging Market ETF Closures/Liquidations
Frontier and emerging market highlights:
3/30/2023 - Invesco BLDRS Emerging Markets 50 ADR Index Fund - ADRE
3/30/2023 - Invesco BulletShares 2023 USD Emerging Markets Debt ETF - BSCE
3/30/2023 - Invesco BulletShares 2024 USD Emerging Markets Debt ETF - BSDE
3/30/2023 - Invesco PureBeta FTSE Emerging Markets ETF - PBEE
3/30/2023 - Invesco RAFI Strategic Emerging Markets ETF - ISEM
2/17/2023 - Direxion Daily CSI 300 China A Share Bear 1X Shares - CHAD
1/13/2023 - First Trust Chindia ETF - FNI
12/28/2022 - Franklin FTSE Russia ETF - FLRU
12/22/2022 - VictoryShares Emerging Market High Div Volatility Wtd ETF CEY
8/22/2022 - iShares MSCI Argentina and Global Exposure ETF AGT
8/22/2022 - iShares MSCI Colombia ETFI COL
6/10/2022 - Infusive Compounding Global Equities ETF JOYY
5/3/2022 - ProShares Short Term USD Emerging Markets Bond ETF EMSH
4/7/2022 - DeltaShares S&P EM 100 & Managed Risk ETF DMRE
3/11/2022 - Direxion Daily Russia Bull 2X Shares RUSL
1/27/2022 - Legg Mason Global Infrastructure ETF INFR
1/14/2022 - Direxion Daily Latin America Bull 2X Shares LBJ
Check out our emerging market ETF lists, ADR lists (updated) and closed-end fund (updated) lists (also see our site map + list update status as some ETF lists are still being updated as of Summer 2022).
I have changed the front page of www.emergingmarketskeptic.com to mainly consist of links to other emerging market newspapers, investment firms, newsletters, blogs, podcasts and other helpful emerging market investing resources. The top menu includes links to other resources as well as a link to a general EM investing tips / advice feed e.g. links to specific and useful articles for EM investors.
Disclaimer. The information and views contained on this website and newsletter is provided for informational purposes only and does not constitute investment advice and/or a recommendation. Your use of any content is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the content. Seek a duly licensed professional for any investment advice. I may have positions in the investments covered. This is not a recommendation to buy or sell any investment mentioned.
Emerging Market Links + The Week Ahead (March 20, 2023) was also published on our website under the Newsletter category.