Wharf (Holdings) Ltd. (00004.HK) has directly benefited from Hong Kong’s retail boom in recent years.
Take its flagship Times Square in Causeway Bay.
It continues to draw strong traffic despite the presence of Hysan Place which opened in 2012. The retail-office complex sits atop the Causeway Bay MTR station.
Times Square offers shoppers more choices thanks to its diverse brand mix.
Also, the shopping mall has a good relationship with credit card issuers, enabling it launch co-branded promotions year round.
Across the water, Wharf’s Harbor City continues to attract hordes of shoppers.
It’s some distance from the nearest MTR station and from Tsim Sha Tsui’s main transport artery, but it makes up for that with shopping convenience in the way shops of the same brand category are located on the same floor.
China’s individual travel scheme has helped drive tourism to Hong Kong, in turn ramping up retail sales.
There is a clear trend in the tourism sector which investors should note, according to stock investor Cao Renchao.
But few have done a better job in making the most of the retail boom than Wharf in the past decade.
However, retail sales have begun to slow. Where should investors look next?
There’s a world of stock options out there if investors want to explore them.
For instance, Apple Inc. has been the subject of discussion about growth and valuation after its share price hit a new record recently.
Much of that growth is attributed to China Mobile (00941.HK) which has helped Apple establish a foothold in the world’s biggest consumer market.
China has about 350 million 3G and 4G subscribers. That number is likely to double in two years.
China Mobile is targeting 250 million new 4G subscribers this year which would boost its average revenue per user (arpu).
Last year, China Mobile’s monthly arpu was 67 yuan compared with 68 yuan in 2012.
Internet and telecom stocks are some of the hottest topics in China but they differ significantly in valuations.
China Mobile is priced above HK$100, down from HK$160 in October 2007 and HK$35 in 2005.
The last phase is always the climax in any uptrend. Wise investors never take profit before the trend has run its course.
This article appeared in the Hong Kong Economic Journal on Feb. 18.
Translation by Julie Zhu
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