Latest news with #post-Covid-19
Business Times
2 hours ago
- Business
- Business Times
Citigroup hiring for Asia rates, prime teams on hedge fund flows
[HONG KONG] Citigroup plans to increase headcount in its Asia rates and prime businesses by 5 to 10 per cent over the next year to cope with booming demand from customers including hedge funds, according to the bank's regional markets chief. 'Client activity in the Hong Kong market has been buoyant,' said Paul Smith, head of markets for Japan, Asia North and Australia, citing especially strong growth in prime and rates divisions. The bank's prime hedge fund clients in Asia have doubled in two years as initial public offering flows into Hong Kong and China bounce back, he said. Hong Kong's benchmark Hang Seng Index is up almost 50 per cent over the past year with the bourse hosting three of the four biggest stock offerings in the world in 2025. 'There is a real sentiment shift,' Smith added, pointing to heavy inflows from US hedge funds and growing demand from quantitative funds seeking access to less-liquid A-shares in China. 'The big theme this year has been about the ability to provide A-shares to quant funds, particularly A-shares that are outside the top 100 names which are less liquid,' said Smith. 'Our robust, stable inventory is proving invaluable in securing mandates from prominent US-based quant funds.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Client flows into Hong Kong and China rose about 30 per cent in the first half of 2025. Citigroup has also ramped up investor visits to China's second- and third-tier cities. With equity revenue concentrated in Hong Kong, some staff are returning to the city post-Covid-19. Robert Stewart, the firm's head of Asia-Pacific equity trading, relocated this year from Singapore. The bank's Hong Kong markets business employs several hundred people, with about 75 per cent in equities. Smith relocated from London to Hong Kong about 18 months ago to take on his current role after the Wall Street bank went through a sweeping reorganisation. Citigroup's traders posted their best second quarter in five years, with fixed-income revenue jumping 20 per cent to US$4.3 billion and equities sales and trading revenue reaching US$1.6 billion. BLOOMBERG
Forbes
15 hours ago
- Business
- Forbes
How Intel Stock Falls To $10
Intel stock (NASDAQ:INTC) has barely moved this year, up just 2%, as the company continues to struggle with shrinking relevance in its core CPU market and underwhelming progress in its foundry ambitions, despite investing over $50 billion in the space. Revenue has collapsed from $79 billion in 2021 to $53 billion in 2024. While the broader PC market is showing signs of stabilization, Intel's top line is projected to decline again this year - suggesting revenue stagnation could become the norm. Meanwhile, stocks of competitors like AMD and Nvidia are soaring, up 43% and 24% respectively in 2025. Could Intel stock plunge to $10 - half its current value? It may seem extreme, but given the steady erosion of its fundamentals, it's no longer unthinkable. Below, we provide a scenario considering three key metrics, namely revenues, net margins, and price-to-earnings multiple. That said, if you want upside with a smoother ride than an individual stock, consider the High Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception. SANTA CLARA, CA - JULY 15: An Intel sign is displayed in front of the Intel company headquarters ... More July 15, 2008 in Santa Clara, California. Intel has reported a 25 percent increase in its second quarter earnings with net income of $1.6 billion or 28 cents per share compared to $1.28 billion, or 22 cents per share one year ago. (Photo by) Revenues Could Stagnate Intel's sales have declined considerably of late. Intel revenues declined from $79 billion in 2021 to $53 billion in 2024 as Intel's CPU sales declined due to the cooling off of the PC market post-Covid-19, and also due to market share gains by rival AMD. The rise in mobile devices and increasing demand for AI chips - areas where Intel has a limited presence - have also hurt. While the PC market is recovering with sales projected to grow by low single-digits this year, Intel's revenues don't look like they will stabilize just yet, with consensus estimates projecting a 2% dip in sales this year. There remains a possibility that Intel could see its revenues stagnate in the interim due to a host of factors. While Intel struggles, Will AGI Take Nvidia Stock To $300? Foundry business may not be taking off: There's are increasing signs that Intel's foundry bet isn't taking off the way the company had expected. During its most recent earnings call, Intel appeared to play down hopes of winning major external customers for its 18A process - its most advanced manufacturing tech to date - with the leadership noting that 18A will primarily be used for internal products to begin with. Intel also said in its quarterly filing that it could potentially 'pause or discontinue' its next-generation 14A process if it was unable to win a significant customer. However, the market for foundry services is actually booming. Taiwan's TSMC - the world's largest foundry player - sees its AI-related chips revenue doubling in 2025 and rising at a mid-40% levels over the next five years. Intel, on the other hand, is witnessing very little of the action. CPU market share losses: Intel's CPU business could face further pressure, despite new launches, as the generative AI era could open the doors to more competition as PC makers look to incorporate more smarts into their devices. For instance, both chip-designer ARM and mobile chipset specialist Qualcomm are pushing into the PC space and Microsoft's latest Copilot+ PCs use ARM chips that offer AI features and consume less power. On the server front too, there could be challenges as accelerated computing servers used for generative AI applications typically require just one CPU for eight or more GPUs in AI servers. Moreover, GPU makers such as Nvidia are playing a bigger role in overall server system design, looking to replace dedicated CPUs from the likes of Intel with lower-powered ARM chips instead of Intel's. This could impact Intel's bread-and-butter CPU business. Foundry utilization dilemma: Intel also faces a dilemma of sorts. While competitors like AMD and NVIDIA use TSMC's superior, cutting-edge manufacturing processes, Intel must balance product competitiveness with the financial health of its own costly foundries. Intel has already been sending some chip orders TSMC's way in recent years for crucial components of some of its recent processors. While this outsourcing boosts Intel's product performance, it simultaneously starves its internal manufacturing division of crucial orders needed to cover fixed costs. This forces Intel into a difficult choice: risk using its own possibly less advanced fabs and falling behind rivals in the CPU game, or undermine its internal foundry operations by further embracing TSMC. Intel is clearly on the back foot. While the company is keen to build momentum - employee morale can't be high either. Customers and buyers are more likely to want the 'best' and if the word on the street is that Intel isn't the 'future' - it's less likely to be the choice 'now.' Everything becomes just a tad harder. Intel revenues are projected at about $52 billion for this year per consensus estimates and there is a possibility that sales could remain flat in the coming years, due to the aforementioned factors. Margins Fall Further? Intel's adjusted net margins (net income, or profits after expenses and taxes, calculated as a percent of revenues) have been on a declining trajectory - they fell from levels of over 28% in 2021 (and in years before that) to just about 8.5% in 2023 due to sales declines and considerable losses in the foundry business. The metric fell to negative levels in 2024 as Intel posted losses. While the markets are likely betting that Intel's margins could eventually expand to historical levels as it sets its product and manufacturing roadmap in order, there remains a possibility that margins could remain depressed, remaining at about 5% levels in 2025. Costs associated with the foundry ramp-up could hurt Intel's bottom line. Moreover, Intel's move to outsource production of its Arrow Lake chip to TSMC could potentially reduce the utilization of its own manufacturing facilities. Intel has also not exactly been known for production efficiency. For perspective, in 2023, Intel's foundry business reported an operating loss of $7 billion on sales of $18.9 billion. Separately, higher competition in the CPU space - where new entrants such as Qualcomm and ARM - might also force Intel to resort to some amount of discounting. How This Impacts Intel's Stock Now at the current market price of about $20 per share, Intel trades at about 160x estimated 2025 earnings and about 1.7x consensus revenue. Since Intel was unprofitable in 2024, let's ignore the P/E multiple for this year. In 2023, Intel traded at about 19x. So what explains the difference in Intel's P/E multiple using 2023 and 2025 earnings? It's because investors are betting that things will get better going forward. However, if Intel doesn't deliver in the interim, investor sentiment could go further downhill. If we combine the scenario we detailed above - which assumes no meaningful annual revenue growth between 2025 and 2027 with adjusted net margins falling to about 5% - this means that adjusted net income could fall from about $4.4 billion in 2023 ($1.05 per share) to about $2.5 billion in 2027 ($0.58). Bad times make it easier to imagine worse times - and when that happens, things can spiral causing investors to assign an even lower multiple to Intel re-assessing Intel's recovery path. For example, if Intel's investors assign a multiple of 18x to Intel, following its continued underperformance, this would translate into a stock price of just about $10 per share. What about the time horizon for this negative-return scenario? While our example illustrates this for a 2027 timeline, in practice, it won't make much difference whether it takes two years or four. If the competitive threat plays out, with Intel also continuing to struggle with manufacturing, we could see a meaningful correction in the stock. While you would do well to be careful with INTC stock for now, you could explore the Trefis Reinforced Value (RV) Portfolio, which has outperformed its all-cap stocks benchmark (combination of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices) to produce strong returns for investors. Why is that? The quarterly rebalanced mix of large-, mid- and small-cap RV Portfolio stocks provided a responsive way to make the most of upbeat market conditions while limiting losses when markets head south, as detailed in RV Portfolio performance metrics.
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Business Standard
21 hours ago
- Business
- Business Standard
China rolls out $500 child subsidies to boost birth rate: But is it enough
China has announced a nationwide annual childcare subsidy of 3,600 yuan (approximately ₹43,000 or $500) per child under the age of three, Chinese state-media Xinhua reported on Monday. This is a significant step towards the country's efforts in reversing the plunging birth rate and ageing population crisis. The initiative, retroactive from January 1, 2025, marks Beijing's most comprehensive pro-birth move yet — but will this amount, though welcome, be sufficient to reverse deep-rooted demographic trends? What's happening with China's population? China recorded its lowest-ever birth rate in 2023, with just 6.39 births per 1,000 people. Although 2024 saw a modest rebound of 520,000 additional births, analysts widely attribute this to a temporary post-Covid-19 recovery. Moreover, 2024 was the year of the Dragon according to Chinese zodiac signs. Children born during this year are believed to possess unique personality traits and are associated with good fortune, which could explain the rare uptick in birth rates. However, the overall population still shrank by two million, its steepest decline since 1961, officially ceding the title of most populous country to India. This is no small concern. By 2035, China is projected to have 400 million citizens over the age of 60—nearly one-third of its total population—raising red flags over future labour shortages, pension sustainability, and economic stagnation. China's one-child policy China's one-child policy, in place from 1980 to 2015, has also left a cultural imprint that will be difficult to erase. The country has been actively reversing the policy, allowing two children from 2016 and three from 2021. While these efforts are slowly being realised, they are not keeping up with the population decline. New subsidy to aid 20 million The new subsidy, which will not be taxed or counted against other welfare benefits, is expected to benefit over 20 million families annually, Xinhua reported. It follows years of local pilot schemes offering more generous incentives, such as Hohhot's 10,000-yuan annual grants per child and Shenyang's monthly payments of 500 yuan for third children. While these schemes have shown some encouraging signs— Tianmen city, for instance, recorded a 17 per cent spike in newborns in 2024 —experts warn against overstating the impact of cash handouts alone. Professor Mao Zhuoyan of Capital University of Economics and Business told Xinhua that while subsidies are helpful in easing day-to-day expenses like formula or diapers, they are not a 'cure-all' to the full cost of raising a child in China. Cost of parenthood in China According to a 2024 report by the YuWa Population Research Institute, the average cost of raising a child from birth to college graduation in China now stands at 680,000 yuan (about ₹82 lakh or $94,557). Even raising a child to the age of 17 costs over 538,000 yuan, placing China among the most expensive countries in the world to have children. Compare this with average annual urban salaries of 125,100 yuan in affluent provinces like Jiangsu and just 58,100 yuan in hospitality sectors—according to Statista, based on annual salaries drawn in 2023—and it becomes evident why many young Chinese are reluctant to start families. Parenthood crisis: What's really deterring China's youth? Beyond finances, broader cultural and societal shifts are at play. Many young people, especially women, cite career pressures, lack of childcare support, and unaffordable housing as key deterrents to parenthood, a report by Think Global Health showed. Delayed marriages, rising infertility, and a longstanding preference for smaller families have further complicated matters. How is the Chinese govt responding to population crisis? In response, Beijing has been introducing a plethora of reforms. Some of these are: Promoting flexible work hours and work-from-home options for parents Offering preferential housing for families with multiple children Expanding childcare and preschool infrastructure Providing IVF and fertility treatments under public health insurance Mandating epidural access in large hospitals by 2027 Is the subsidy too little, too late? While the subsidy signals serious intent, experts argue it's far from a silver bullet. Yang Yiyong from the Academy of Macroeconomic Research told Xinhua that China needs affordable education, accessible child and maternity care, workplace protections for mothers, and social support structures. And time is running out. Projections of the United Nations estimate China's population could shrink to 1.3 billion by 2050, and further to 633 million by 2100, losing over 750 million people this century. Are there lessons for India here? As India assumes the role of the world's most populous nation, Beijing's policy evolution holds crucial lessons. India, too, is seeing a fertility slowdown, and the economic and social costs of parenthood are rising rapidly in urban areas. Last month, a LinkedIn post by Bengaluru-based startup founder Meenal Goel went viral, where Goel estimated the cost of raising a child in India to be between ₹38-45 lakh. Other media reports suggest these costs can even go above ₹1 crore, depending on school fees, tuition, college, lifestyle, etc. China's experiment is a sign that reversing a demographic slide is complex and expensive. Moreover, while subsidies may be helpful, a much wider structural transformation is still needed. The bottom line China's 3,600-yuan subsidy is a notable step, but unless backed by deeper social reforms, it may not be enough to convince families that parenthood is affordable or desirable in the modern Chinese economy.
The Star
a day ago
- Business
- The Star
110 S'wak students get PETRONAS sponsorship for tertiary studies
KUCHING: Some 110 Sarawakian students have received sponsorships totalling RM28mil from PETRONAS for their tertiary studies. The outstanding 2024 SPM school leavers from diverse backgrounds will pursue degrees in engineering, economics, law and other industry-related courses at local and overseas universities under the PETRONAS Powering Knowledge education sponsorship. State Women, Childhood and Community Wellbeing Development Minister Datuk Seri Fatimah Abdullah welcomed the national oil corporation's continuous commitment to developing Sarawakian talent. "By investing in the education and development of Sarawakian youth, PETRONAS is helping us lay the foundation for a future that is resilient, competitive and inclusive," she said at the sponsorship presentation ceremony here on Tuesday (July 29). Fatimah, who was representing Sarawak Premier Tan Sri Abang Johari Openg, said this aligned with the state government's post-Covid-19 development strategy, which aimed to position Sarawak as a high-income developed state by 2030. "At the heart of this vision is our focus on building talent and expanding opportunities across all levels of education, from early childhood to tertiary, from academic pathways to technical and vocational training. "We are determined to ensure that every Sarawakian has the opportunity to thrive and move forward," she said. Fatimah also said the education sponsorship was a platform to shape future professionals and leaders who would contribute to Sarawak's and Malaysia's progress. "What we hope to see in return is not only graduates with academic excellence, but individuals who come back with a sense of responsibility and purpose," she added. PETRONAS senior general manager (human capital expertise) Akmal Niza Ahmad said the Powering Knowledge initiative supported a wide range of programmes to empower Malaysians from all walks of life. "This is part of our commitment, reinforcing how we continue to invest in future talent for the organisation, the industry and the nation," she said. Since its inception in 1975, the PETRONAS education sponsorship has benefitted over 40,000 Malaysian students.
Business Times
a day ago
- Automotive
- Business Times
The world's biggest passenger planes keep breaking down
[SYDNEY] The world's largest commercial passenger jet, the Airbus A380, enjoyed an unexpected resurgence hauling full loads of passengers when global travel rebounded after the pandemic. But keeping the ageing superjumbo safely airborne is becoming an increasingly expensive headache for airlines. Two decades after its maiden flight, regulatory bulletins ordering repairs, inspections or replacement parts for the massive four-engined plane are piling up. While some are procedural, such as a demand for timely equipment checks, others are more serious. Leaking escape slides, cracked seals and a ruptured landing-gear axle feature among 95 airworthiness directives for the A380 listed by the European Union Aviation Safety Agency since January 2020. That's about double the number of directives for large Boeing aircraft in the same period. With newer, more fuel-efficient jets in short supply, airlines committed to the twin-deck A380 have little choice but to keep flying it. In its youth, the A380 was a triumph of international collaboration, with four million parts made by 1,500 companies worldwide. Now, in old age, the aircraft's complexity is testing aviation's fractured supply chains in the post-Covid-19 era. 'The A380 is a complex aeroplane whose scale does make it more demanding to maintain compared to other aircraft,' the European Union Aviation Safety Agency (Easa) said. 'It is very important for safety that there is no stigma attached to publishing an airworthiness directive, safety must come first.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The agency said such directives, which mandate actions to make an aircraft safe, 'can vary hugely in scope and urgency'. The volume of airworthiness directives for different planes 'is not a good basis for comparison', Easa said. Stranded passengers However, with the capacity to carry 485 passengers or more, delays caused by mechanical failures can be costly and create a cascade of scheduling headaches. A Qantas Airways A380 on the flagship Sydney-London route broke down in Singapore on May 7 with fuel-pump problems. The onward flight to London was pushed back more than 24 hours and passengers accommodated in hotels. That was at least the second fuel-pump issue to delay QF1 in Singapore since Qantas reactivated its A380s. More recently, Qantas passengers who were due to depart Singapore on Jul 14 for Sydney on an A380 were delayed for days because of technical difficulties. Plans to retrieve them sooner were complicated by damage to another A380 at Sydney airport, when an aerobridge slammed into one of the engines. A British Airways A380, G-XLEB, recently spent more than 100 days in Manila. After returning to London Heathrow in mid-June, it flew just seven days of the next 30, according to Flightradar24. Still, IAG-owned British Airways from next year will embark on an interior upgrade programme, including overhauling A380 cabins, suggesting the airline will keep flying the plane for years. For airlines using the A380, large-capacity alternatives are scarce. Boeing's new 777X is years behind schedule and Airbus cannot make long-haul A350s fast enough. Meanwhile, A380 operators are left with an out-of-production superjumbo that will only become more needy and more expensive to run. In online aviation forums, some services are gaining a name for breakdowns, cancellations or overnight delays. In a statement, Airbus said that the A380 'continues to operate scheduled services with a high level of operational reliability, standing at 99 per cent for the global fleet over the past 12 months. Airbus is committed to providing full technical support to customers to ensure that they can optimise operations with their A380 fleets, and this will continue as long as the aircraft remains in service'. 60,000 hours Meanwhile, A380s are taking up space and manpower in workshops around the world, exacerbating a shortage of repair facilities for the wider commercial fleet. A comprehensive check of the massive plane can consume 60,000 hours of labour, according to aircraft repairer Lufthansa Technik. Qantas is sending some double-deckers to Dresden in Germany to be overhauled; British Airways flies its to Manila for repairs; and Emirates, the world's biggest operator of A380s, maintains some in China. Some of the aircraft's recent faults stem from prolonged periods on the ground during the pandemic, when airlines parked their A380s in the Californian desert, central Spain or the Australian outback. An airworthiness directive from the European Union Aviation Safety Agency on May 16 ordered emergency inflatable escape slides to be replaced. Glued seams had split, probably due to exposure to moisture and heat during storage. The fault could have fatal consequences, Easa said. On Apr 7, Easa ordered inspections on A380s after cracked sealant was found on fittings attaching the landing gear to the wings. A directive in April last year required some landing gear axles to be replaced after a rupture on a plane that had been in storage since 2020. The future of the A380 was already in doubt when Covid-19 halted global travel in early 2020. The year before, Airbus had killed off production after underwhelming sales. When Covid-19 receded and borders reopened, the A380 suddenly found new purpose. Travel boomed and carriers including Singapore Airlines, Deutsche Lufthansa AG and Qantas, once again embraced the plane's unrivalled carrying power. In a statement, British Airways called the A380 'a vital part of our long-haul fleet. Through working closely with Airbus, we have seen consistent year-on-year improvements in its reliability'. Qantas said the plane 'is a key part of our international network, and we will continue to fly them for years to come. All Qantas A380s have gone through a scheduled major maintenance overhaul in recent years, as well as significant upgrades to the cabin interiors'. Other A380 operators were reluctant to provide specific details. Asiana Airlines said that 'issues related to aircraft operations and maintenance are difficult to disclose externally'. Korean Air Lines said that it 'maintains its A380 fleet to the highest safety standards, in strict accordance with all regulatory requirements and manufacturer guidelines'. Singapore Airlines said that its 12 A380s are important to operations, but it was 'unable to comment on specifics'. The company said that it works closely with 'Airbus and our suppliers to ensure the ongoing reliability and serviceability of our A380 fleet'. To be sure, the A380 still has fans. Emirates, which has cannibalised some A380s for spare parts, plans to keep flying the aircraft until the end of the next decade. The airline's president, Tim Clark, has likened the jet to a huge vacuum cleaner capable of gobbling up passengers such as no other plane. Reliability issues are the latest twist for a superjumbo that has almost always been divisive. Passengers still love the A380's cavernous interiors and audacious scale. Airlines wrestle with its logistics needs – from longer runways to extra-large hangars, as well as the mechanical dramas. Supply chain constraints have increased the price of parts, servicing and engine repairs on all major aircraft, said Eddy Pieniazek, Ishka's head of advisory. 'With the A380 being of its size and having four engines, this escalation in maintenance costs has become even more noticeable,' said Pieniazek. BLOOMBERG
