CX Daily：China Allows Private Refineries to Tap Export Market

Energy /

China seeks new outlet for oil refiners’ excess capacity

China’s cabinet has decided to further pursue a policy of allowing eligible private refiners to export their products. The decision highlights how the country is grappling with overcapacity in its oil refining market that has taken a toll on the industry’s bottom line.

In an opinion document released Sunday, the State Council asked government departments to study the measure and establish a specific pathway and timetable to give private refineries access to the overseas market. It is the first policy document to clearly state that private refiners could be eligible to export their products.

Currently, only five state-owned oil companies — China National Petroleum Corp. (CNPC), China Petrochemical Corp. (Sinopec), China National Offshore Oil Corp. (CNOOC), Sinochem Corp. and China National Aviation Fuel Group Ltd. — are allowed to export a limited quantity of refined oil products under a quota system.

FINANCE & ECONOMICS

Banking /

Exclusive: Baoshang Bank scandal takes down another regulator

A banking regulatory official in the Inner Mongolia autonomous region has become the latest target of investigators on suspicion of corruption in connection with Baoshang Bank Co. Ltd., a struggling lender taken over by regulators in May.

Jia Qizhen, an official at the Inner Mongolia branch of the China Banking and Insurance Regulatory Commission, is suspected of “serious violations of (Communist Party) discipline and law,” top graft watchdog said. Ji is among several local banking regulators that have been placed under probe in recent months for links with the troubled bank, Caixin learned.

Bond default /

HNA narrowly avoids first public bond default, sources say

Troubled Chinese conglomerate HNA Group Co. repaid a 1.3 billion yuan ($185 million) bond due Tuesday, according to people familiar with the matter, avoiding what could have been its first default on a publicly issued note.

An investor briefed by HNA’s bond trustee said the company has wired the funds to the clearinghouse, while another bondholder said it received the full payment. HNA’s move is the latest of a series of developments that have helped calm frayed nerves in China’s debt markets in recent days.

IPO /

China’s first high-speed rail IPO comes as more opening hinted

The operator of China’s high-speed rail line between Beijing and Shanghai kicked off its initial public offering, which will for the first time allow investors to tap into the world’s largest high-speed railway network.

Beijing-Shanghai High-Speed Railway Co., a unit of state-owned China Railway Corp., plans to sell as many as 6.3 billion new shares, or 12.8% of its enlarged capital, through the listing in Shanghai, according to its prospectus released Wednesday. Book building for the IPO will begin Jan. 6, it said. The company didn’t say how much it aimed to raise through the sale.

Pork /

Charts of the day: China’s pig population grows for first time in 2019

China live pig stocks partially rebounded last month amid a government push for a recovery in the pig farming sector, rising 2% compared with October and marking the first month-on-month growth in 13 months, official data showed.

Meanwhile, pork imports more than doubled year-on-year in November as the world’s top pork consumer tried to make up for pig shortages and deal with soaring prices due to deadly African swine fever.

Quick hits /

Hong Kong residents eye homes overseas as protests drag on

Opinion: Despite phase one deal, uncertainty persists in Sino-U.S. agricultural purchases

BUSINESS & TECH

Auto /

Top Chinese carmakers hitch up for technology development

Two of China’s largest automakers have announced a major new strategic partnership, in the latest collaboration within an increasingly technology-driven sector facing increasingly prohibitive costs for developing new products and services.

The alliance between Shanghai-based SAIC Motor Corp. Ltd. and Guangzhou Automobile Group Co. Ltd. (GAC) represents a major partnership between companies that collectively control one-third of China’s auto market — the world’s largest. The broad-ranging strategic tie-up signed between the pair on Monday could see them collaborate in a number of areas such as new-energy and self-driving vehicles and development of new business models such as those behind shared cars.

Startup /

Luckin now has more coffee shops in China than Starbucks

Surging Chinese café chain Luckin Coffee appears to have fulfilled a pledge made at the start of 2019 and edged ahead of Starbucks to become the country’s biggest coffee chain.

Beijing-based Luckin, which only launched in January last year and has yet to turn a profit, now has 4,910 stores in China, outnumbering its American rival by more than 600 locations, according to research firm Thinknum Alternative Data. Starbucks, for which China is the company’s second-largest revenue stream after the U.S., has 4,300 locations in the East Asian nation.

Fundraising /

Battery-sharing firm Energy Monster completes $71.5 million funding round

Chinese portable battery-sharing startup Energy Monster has raised 500 million yuan in a series C funding round led by SoftBank Ventures Asia, China News Service reported Tuesday.

The Shanghai-based firm, which provides table-mounted and take-away chargers at public places including bars, restaurants and convenience stores, will use the newly-raised capital to expand its existing business and explore new opportunities. Other investors include Hillhouse Capital, Shunwei Capital, and BOC International, among others, the report said.

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