Emerging Markets Daily - April 12
Southeast Asia Tech Rising, India Second Hardest Hit Covid Country, Alibaba Shares Soar, Vietnam Stock Market Fever, Major Oil Deal for Total in Uganda
The Top 5 Emerging Markets Stories from Global Media - April 12
Grab’s $34 Billion SPAC Deal Puts Southeast Asia Tech on the Map
Bloomberg
“Grab Holdings Inc. and Traveloka are poised to become public companies in coming months, kickstarting a coming-out party for Southeast Asia’s long-overlooked internet scene.”
“Grab will this week unveil a listing via a U.S. blank-check company that’s drawn backers from T. Rowe Price to Temasek Holdings Pte and values the ride-hailing giant at more than $34 billion, people familiar with the matter said, in the largest-ever deal of its kind. Indonesia’s Traveloka will follow suit, listing at a valuation of about $5 billion via a special purpose acquisition company backed by billionaires Richard Li and Peter Thiel, other people with knowledge of the matter said. Terms on both deals could still change, the people said.”
“The mega deals will front a chain of initial public offerings from the region’s most valuable startups from 2021, from Grab arch-foe Gojek and e-commerce giant Tokopedia to Singapore’s PropertyGuru. Their debuts allow investors to bet on the industry’s ascendancy in the post-Covid mobile era over the financial institutions and industrial conglomerates that have long dominated Southeast Asia’s corporate landscape. Over the longer term, market watchers expect fast-growth technology firms to dominate attention like they have in China and the U.S., overhauling a Southeast Asian roster now led by gaming and e-commerce leader Sea Ltd.” Yoolim Lee, Manuel Baigorri, Abhishek Vishnoi, and Ishika Mookerjee report
India Overtakes Brazil as World's Second Worst-Hit Country by COVID
Reuters
“India reported a record daily tally of 168,912 COVID-19 infections on Monday, the world’s highest, while worries grew over a further spike, as hundreds of thousands of devotees gathered for a ritual bath in the Ganges river.”
“India now accounts for one in every six daily infections worldwide. Monday’s new cases carried it past Brazil, for an overall tally of 13.53 million, data compiled by Reuters shows, placing it second after the United States, with 31.2 million.”
“A full opening of India’s economy after last year’s crippling lockdown, mass religious festivals and political rallies in states holding elections have worsened a second wave of infections, experts say.”
“Elections are also due in four big states this month, with Prime Minister Narendra Modi set to travel to the eastern state of West Bengal to address rallies that will draw thousands.” Saurabh Sharma Rajendra Jadhav reports
Alibaba Shares Soar after Record Antitrust Fine
Financial Times
“Alibaba shares rose sharply on Monday after the ecommerce group founded by billionaire Jack Ma said a record $2.8bn fine at the weekend marked the end of an antitrust investigation into the company.”
“Executives told an analyst conference that while regulators were still probing China’s broader tech industry over past mergers and acquisitions, they did not know of any more specific investigations into Alibaba’s business. The company’s Hong Kong-listed stock was up 7.8 per cent after the remarks.”
“But global investors should conclude from the antitrust push that regulators have backed Alibaba’s business model, coining in law the term ‘platform economy’, Tsai said.” Yuan Yang reports
Stock Market Fever Grips Vietnam
Nikkei Asia
“As in the U.S., where use of the Robinhood investment app rocketed among Americans stuck at home, Vietnamese have taken to smartphone apps to trade remotely…”
“The government aims to have Vietnam upgraded from frontier to emerging market status on the MSCI and FTSE share indexes. That will require loosening restrictions, however, such as allowing greater foreign ownership and intraday trading.”
“For Vietnam's young stock market, the surge in first-time investors demonstrates that owning shares is becoming a norm, said Huynh Minh Tuan, brokerage director at Mirae Asset Securities.”
“Tuan said there is another reason for the flow of money into equities: the rise of a generation flush with inherited wealth. Once the ruling Communist Party opened the door to capitalism in 1986, Vietnamese began to privatize state companies or start their own businesses. Three decades later, their children are coming of age. They study abroad, take over their parents' companies, invest their saved earnings in shares or other assets -- or all three.”
“This combination of behaviors makes for increasingly informed investors, Tuan said, which include the next generation of entrepreneurs and wealthier citizens more broadly. Disposable income per capita is rising by more than 9% annually and is forecast to reach $3,062 in 2023, according to U.S. consultancy McKinsey & Co.”
Lien Hoang reports for Nikkei Asia
Total Signs Agreements with Uganda on East Africa Oil Project
Bloomberg
“Total SE signed agreements along with Ugandan officials for an oil development set to transform the East African nation into a significant crude producer and exporter.”
“Total CEO Patrick Pouyanne was among those who signed deals Sunday, according to a broadcast of the ceremony attended by Ugandan President Yoweri Museveni and Tanzanian President Samia Suluhu Hassan. The agreements faced multiple delays since the first commercial discoveries of oil were made 15 years ago. China’s biggest offshore oil and gas producer, Cnooc Ltd., and Uganda National Oil Co. are also partners who participated.”
“Total expects production to reach a plateau of 230,000 barrels per day. That’s higher than the output of Equatorial Guinea and Gabon, two of Africa’s OPEC members, according to data compiled by Bloomberg.” Fred Ojambo and Paul Burkhardt report
What Also Caught Our Eye - Covid Watch
Top Chinese Official Admits Vaccines Have Low Effectiveness
AP
“China’s top disease control official, in a rare acknowledgement, said current vaccines offer low protection against the coronavirus and mixing them is among strategies being considered to boost their effectiveness.”
“China has distributed hundreds of millions of doses of domestically made vaccines abroad and is relying on them for its own mass immunization campaign.”
“But the director of the Chinese Center for Disease Control and Prevention, Gao Fu, said at a conference Saturday their efficacy rates needed improving.”
‘We will solve the issue that current vaccines don’t have very high protection rates,’ Gao said in a presentation on Chinese COVID-19 vaccines and immunization strategies at a conference in the southwestern city of Chengdu. ‘It’s now under consideration whether we should use different vaccines from different technical lines for the immunization process.’ Joe McDonald and Huizhong Wu report
