Towards the end of June, China’s Mobile’s Hong Kong-listed stock hit HK$80 for the first time. It passed HK$90 in July before slipping back to around the HK$80 mark in August when investors started panicking about the US subprime crisis. Since then it is has been pretty much one-way traffic and, right now, China Mobile is close to HK$160.
So far this year, its stock has gained over 130%, boosting the company’s market capitalization by US$240 billion so it is now worth more than US$400 billion. It has become the fourth-largest listed company in the world by market cap after ExxonMobil, PetroChina and General Electric. [Incidentally, China now accounts for six of the world’s 12 largest listed firms – a sign of a strong equities market if ever there was one.]
Citi – which, like a number of other investment banks, now backs China Mobile to pass US$190 – published some figures yesterday that put the telecom operator’s sheer power in perspective:
– China Mobile accounts for nearly 50% of the total market cap of all Asian telecoms companies
– Its market cap is US$155 billion more than second-placed global telecoms operator AT&T
– It is singlehandedly responsible for the MSCI Asia Pacific ex-Japan telecom index rising 59% so far this year while the broader MSCI Asia Pacific ex-Japan index has risen 48%
Citi also make the case for the stock rising even further due to: positive investor sentiment attached to an impending A-share listing (although no exact date has been set); it has RMB cash and the RMB is appreciating against the dollar (it is, of course, in the same boat as many other Chinese companies – and right now the rising tide is floating all boats); it’s a consumer play and these are tipped to do well out of Beijing 2008.
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