Media Focus on Multinational Corporations[2022.05.23]






Xiaomi hopes to reach a consensus with India authorities

Xiaomi Corp said on Thursday that its Indian branch has always been operating in compliance with local laws and regulations, and it will continue to maintain candid communication with the Indian government and hopes to soon reach a consensus.

The comments came after its recent dispute with the Indian authorities, which led to $725 million worth of Xiaomi’s assets being seized in April for allegedly breaching India’s foreign exchange laws.

Wang Xiang, president of Xiaomi, said in a conference call on Thursday night that the company has made personnel adjustments for Xiaomi India, hoping to respond better to the situation.

Xiaomi ranked top in smartphone shipments in India for the 18th consecutive quarter, according to the company’s financial report on the first quarter, which did not disclose specific financial data.

In April, India’s anti-money laundering agency seized assets worth about $725 million from Xiaomi India for allegedly breaching the country’s foreign exchange laws.

In the three months that concluded on March 31Xiaomi’s revenue reached 73.4 billion yuan ($10.9 billion), a year-on-year decrease of 4.6 percent.

Wang said the COVID-19 epidemic caused many stores to suspend sales, and it also affected consumers’ desire to buy smartphones.

Wang said he is confident that the epidemic will pass, and Xiaomi will continue to invest in key areas, reduce costs and improve the efficiency of the company’s operations.


Maersk gets back to business in Shanghai

Danish shipping and logistics giant A.P. Moller-Maersk said demand for transport services will surge in China's Yangtze River Delta region in the coming weeks, as a growing number of manufacturers in Shanghai have relaunched operations, said a senior executive on Thursday.

With the number of new COVID infections showing a downward trend recently in Shanghai, Caroline Wu, managing director of Maersk China, said the company continues to see Shanghai ports remaining operational including vessel operations, yard handling, gate in and gate out.

For instance, both export empty pickups and laden gate-in figures recovered to above 65 percent of normal weekly volumes, and import laden pickups improved to between 80 percent and 90 percent last week.

'At present, the group has 44 weekly port calls in Shanghai. Even though we have some effective adjustments for schedule recovery to counter the impact of congestion in ports in Europe and the United States as well as delays and supply chain bottlenecks, Maersk hasn't had large-scale cancellation of sailings. We have deployed enough capacity in Shanghai during the past months,' Wu said.

Ocean East Logistics Co, one of Maersk's wholly owned subsidiaries in Shanghai, has maintained closed-loop operations since mid-April, helping customers with warehousing, consolidation and distribution services.

'For landside transportation, we have seen the capacity of Maersk trucking services to and from Shanghai gradually improve to 70 percent,' she said, adding that the company will work closely with its customers and partners, seeking alternative solutions including multimodal services between Shanghai and nearby cities.

During the past few months, Maersk has strengthened barge services by offering more than 20 corridors to create several 'land to water' alternative transport solutions, covering the hinterland of East China to ensure the stability of supply chains.


Infineon recovering in financial hub

German chipmaker Infineon Technologies AG said on Thursday throughput at its distribution center in Shanghai has returned to 50 percent of its normal level under closed-loop management, as local authorities introduce measures to help businesses resume operations from COVID disruptions.

Experts said Shanghai is an important base for China's semiconductor industry and the situation is improving but it will take time for chip-related companies to fully return to normal operations.

Infineon said in a statement to China Daily that it has been included on a 'white list' which permits companies to resume work in Shanghai, and it has provided adequate accommodation support and subsidies for its employees resuming work under closed-loop management.

'The Distribution Center China in Pudong is expected to fully resume work in June, according to the local government's arrangement,' Infineon said.

According to the company, the transportation of chips and raw materials imported from other countries to Infineon's factory in Wuxi, Jiangsu province, as well as shipments of finished products from the factory to its distribution center in Shanghai, have also largely returned to normal.

'China is the largest and fastest-growing semiconductor market in the world and the largest regional market for Infineon. We have always attached great importance to the Chinese market and have expanded investment through a series of localization measures to better serve local customers in China,' Infineon said.

According to the company, it is discussing risk prevention strategies with the local government and logistics providers to better cope with the impact of the epidemic on supply chains and to ensure business continuity and supply stability.


Tencent reports drop in profit for Q1

Chinese tech heavyweight Tencent Holdings Ltd reported on Wednesday its total revenue came in at 135.5 billion yuan ($21.3 billion) in the first quarter of this year, versus 135.3 billion yuan in the same quarter last year.

Profit attributable to equity holders for the quarter was 25.5 billion yuan, down 23 percent year-on-year, marking a decline for three consecutive quarters.

'During the challenging first quarter of 2022, we implemented cost control initiatives and rationalized certain non-core businesses, which would enable us to achieve a more optimized cost structure going forward,' said Pony Ma, chairman and CEO of Tencent.

The company has continued to invest in strategic growth areas, including enterprise software, video accounts and international games, Ma said.

Revenue from fintech and business services rose 10 percent on a yearly basis to 42.8 billion yuan in the first quarter. Moreover, Tencent has increased investment in research and development as R&D expenditure stood at 15.4 billion yuan, an increase of 36 percent year-on-year.

Revenue from domestic games decreased by 1 percent to 33.0 billion yuan, partly due to restrictions on playtime for minors.


Alibaba digital initiative inks partnership deal in Mexico

The Electronic World Trade Platform, an initiative to promote inclusive global trade and the digital economy, has officially set foot in Latin America by launching its first partnership in Mexico.

The platform, initiated by e-commerce giant Alibaba in 2016, signed an agreement with the Mexican Governors Conference earlier in May, under which the duo pledged to nurture local talents and support the digital transformation of Mexican small businesses, according to a press release from the company.

Through providing actionable guidance and training, the partnership will help Mexican enterprises expand their business online through digital transformation and will support SMEs to get better access and more opportunity to participate in the global digital market.

The pair has a track record of fostering local talents and empowering local businesses with digitalization expertise. For instance, the pair launched a Mexican Digital Village Project in 2020, helping nearly 1,500 enterprises transform their businesses. The renovated shops are equipped with digital stores, payment solutions and smart logistics.

According to data from the Mexican Association of Online Sales, e-commerce in Mexico has increased by 27 percent in 2021, its third consecutive year of growth. This placed the country in the top five globally, along with India, Brazil, Russia and Argentina, in terms of year-to-year e-commerce growth.


JD reports revenue rises in Q1 2022

Chinese e-commerce giant JD reported on Tuesday night that its net revenues during the first quarter of this year reached 239.7 billion yuan ($35.52 billion), an increase of 18 percent year-on-year.

However, the net loss attributable to ordinary shareholders in the first quarter stood at 3 billion yuan, compared with a net income of 3.6 billion yuan for the same period last year, partly due to continuous capital input in infrastructure, research and development and employees' salaries and welfare.

Its net service revenues during the January-March period rose 26.3 percent year-on-year to 35.2 billion yuan. Annual active customer accounts increased by 16.2 percent to 580.5 million in the twelve months which ended March 31, notably higher than the 499.8 million in the twelve months which ended March 31 in 2021.

As of March 31, JD Logistics, the logistics arm of JD, operated approximately 1,400 warehouses, covering an aggregated gross floor area of over 25 million square meters.

'JD's robust supply chain capabilities and technology-driven operating efficiency underpinned our solid performance during the quarter as we continued to deliver healthy growth amidst a challenging external environment,' said Xu Lei, CEO of JD, adding they are actively leveraging core competences to support local communities and enterprises in regions affected by the latest resurgence of domestic COVID-19 cases.

In support of the combat against COVID-19 in Shanghai, the company has transported over 80,000 metric tons of essential daily items since the beginning of this month, including medicine and maternal products, and has dispatched over 4,000 couriers to support local supply operations.

Additionally, over 100 JD autonomous vehicles have been deployed to Shanghai to facilitate last-mile deliveries of customer orders and protective equipment to makeshift hospitals, communities and delivery stations during the citywide lockdown.

SK hynix

Korean memory chip giant's manufacturing project breaks ground in China's Dalian

DALIAN - SK hynix, a semiconductor firm headquartered in the Republic of Korea, started constructing a non-volatile memory manufacturing project in Northeast China's Dalian city on Monday.

The project will include a new wafer factory to produce non-volatile 3D NAND chip memory products.

SK hynix closed the first phase of the transaction to acquire Intel's NAND and solid-state drive (SSD) business at the end of 2021, taking over Intel's SSD business and the Dalian NAND flash manufacturing facility.

According to the municipal government of Dalian, Liaoning province, this is a key project to continue to expand investment in Dalian after the successful acquisition. It will promote Dalian to build a new generation of information technology industrial clusters.


Budweiser helps Shanghai in time of need with emergency drinking water

Beer manufacturer Budweiser China donated 108,000 cans of emergency drinking water to makeshift hospitals across Shanghai to support the city's fight against the pandemic, a company executive said on Tuesday.

Facilitated by local government branches, including the Commission of Commerce of Shanghai Huangpu District, and Shanghai Committee of the China National Democratic Construction Assn and its charity foundation, the emergency drinking water was delivered to makeshift hospitals in Shanghai's Baoshan, Songjiang and Minhang districts, and several communities in Huangpu district.

The emergency drinking program is an AB InBev global initiative. In 2015, the program was introduced in China in an effort to provide clean and safe drinking water to local disaster areas, water-stressed regions, and to people working on the front line of disaster relief as quickly as possible.

Since then, Budweiser China has assisted many areas stricken by calamities across China. More than 1.7 million cans of Budweiser emergency water have been delivered to those in need to date.

'I am proud that Budweiser China has supported our community in Shanghai with clean drinking water,' said Jan Craps, Bud APAC's chief executive and co-chair of the board.

The executive said that the group is committed to practicing social responsibility. Budweiser China will continue to provide meaningful assistance and support the country's fight against the pandemic.


Honor has standout Q1, eyeing PC development

Honor Device Co Ltd sees this year as a crucial starter to make an ambitious comeback in overseas markets including the Middle East, Europe and the Asia-Pacific, after the former unit of Huawei Technologies Co spent more than a year reviving its popularity in the domestic market.

Meanwhile, the company is ramping up its presence in the personal computer market after its smartphone shipments in China grew 290 percent year-on-year in the first quarter, defying an industry decline of 14 percent, according to data from market research company International Data Corp.

Exxon Mobil

Exxon to sell north Texas gas assets to BKV for $750 million

Exxon Mobil Corp (XOM.N) on Thursday said it signed a deal to sell North Texas natural gas properties to producer BKV Corp for $750 million, as part of a wider move to shed unwanted assets.

Exxon, the top U.S. oil producer, set a goal three years ago to sell by last December $15 billion in assets to pay down debt and focus on lower cost oil production. But it has achieved about half its goal as sales stalled during the pandemic.

This year’s rebound in oil and gas prices has brought renewed interest in its properties, Senior Vice President Neil Chapman told analysts in March.

North Texas assets sales include additional payments based on future gas prices, allowing the company to profit from rising fuel costs. The deal is expected to close by June 30.

“We are focused on delivering the most competitive returns to our shareholders by developing opportunities with the lowest cost of supply,” said Liam Mallon, president of Exxon Mobil Upstream Company.

Denver-based BKV is majority owned by Thai energy firm Banpu PCL (BANPU.BK) and is the largest natural gas producer in the Barnett Shale, an area of north Texas where the first shale wells were successfully drilled.

Exxon is offering assets in Asia, Africa and Europe as it as focuses on Guyana, offshore Brazil and the Permian Basin of West Texas and New Mexico. It is marketing assets in Iraq, Chad, Nigeria, Canada, and in Arkansas and Ohio.


ADNOC Launches Listing Process Of Borouge On Abu Dhabi Securities Exchange

Abu Dhabi National Oil Company (ADNOC), together with its long-standing partner Borealis AG, today announced an intention to float 10 percent of Borouge plc, their petrochemicals joint venture, on the Abu Dhabi Securities Exchange (ADX) through an initial public offering (IPO).

The offering is expected to open on 23rd May, 2022, subject to regulatory approvals and other relevant considerations.

Borouge, established in 1998, combines the strength and experience of ADNOC and Borealis, through ADP, its Operations joint venture, headquartered in Abu Dhabi and PTE, its Sales and Marketing joint venture, headquartered in Singapore.

Today, Borouge is one of the world's leading providers of innovative and differentiated polyolefin solutions for the agriculture, infrastructure, energy, advanced packaging, mobility and healthcare industries. The Borouge portfolio of products comprises polyethylene and polypropylene, the two most common types of polymers, which are used for various applications such as sustainable packaging, pipes and fittings, wires and cables, automotive and medical applications.

Borouge's polymer solutions are categorised into two main product segments: consumer solutions and infrastructure solutions.

Consumer solutions include sustainable packaging, medical containers and greenhouse films, while infrastructure solutions include water and gas pipes and cables for power transmission.


Shell, Brazil’s Açu Partner to Build Green Hydrogen Plant  

Shell and Brazil's Porto do Açu have agreed to jointly build a green hydrogen plant, executives told Reuters, a deal that could result in the debut of the up-and-coming technology in South America’s largest nation.

Under the terms of a memorandum of understanding signed May 19 and first disclosed to the news agency, the firms will build a 10-megawatt green hydrogen plant on the premises of Açu in Brazil's Rio de Janeiro state. The plant is due to be completed by 2025.

Green hydrogen is a zero-carbon fuel made by using renewable power to split water into oxygen and hydrogen, increasingly promoted as a way to clean up emissions-heavy industries such as refining and agriculture.

Açu, a massive industrial complex and port, is owned by Prumo Logistica SA, which is in turn controlled by U.S. private equity firm EIG Global Energy Partners.

Two subsequent, optional phases in the project would bring production to 100 megawatts by 2029, under the terms of the memorandum. The first phase alone will likely require $20 million to $40 million in investment, a spokesperson for Shell wrote in an e-mail, warning that those values are subject to change.

While several companies have proposed building green hydrogen plants in Brazil, the Shell-Açu deal stands out as a project that will begin shortly, while production is scheduled to start in three years. Most projects proposed in Brazil have not moved past conceptual or viability stages.

The current market of consumers is extremely small. But by creating supply of green hydrogen, the consortium hopes to spur demand, while catalyzing green hydrogen usage writ large, Monique Gonçalves, head of regulatory affairs for Shell in Brazil, and Mauro Andrade, executive director of business development at Prumo, said in a joint interview.

“The idea is to test the market for green hydrogen in Brazil,” Andrade said. “We want to test off-takers outside of Brazil as well. Everyone talks about green hydrogen, but in the market today the number of off-takers is still limited.”

Funds to build the plant will come from a pot of resources that Brazil’s oil regulator requires each producer to set aside for projects linked to research and development.