Rich List: China dynasties built on bandwidth

China's has generated fortunes at a rate that is the envy of the developed and emerging worlds, much of it produced by far-sighted digital entrepreneurs.
Wang Jianling, Asia's richest man
Wang Jianling, Asia's richest man

The People’s Bank of China (PBoC) loosened monetary policy last year as the country experienced the slowest economic growth since the mid-1990s, amid a property price slump and weaker industrial output. The credit expansion helped fuel soaring stock market prices and also alleviate pressure on highly indebted property developers.

Guangzhou-based Evergrande Real Estate, China’s second-biggest property developer, was a major beneficiary, not least because it had racked up dollar-denominated debt during the previous two years and attracted concerned scrutiny from investors.

Listed in Hong Kong, Evergrande focuses on residential and commercial properties in tier-3 cities on the mainland, where inventories had risen as sales declined. On 29 May, the company’s share price dove by more than 20% following a heavily discounted HK$4.6 billion ($590 million) private placement. Yet it was subsequently able to post a 56.5% jump in interim core profits in August, vindicating the company’s generous dividend policy.

Chairman Hui Ka Yan collected $705 million last year, placing him fourth in the Rich List, ahead of Asia’s richest man by net worth, Wang Jianlin, who heads the Dalian Wanda Group.

Wang (7) raised $3.7 billion in Hong Kong in December when he listed Wanda Commercial Properties, which runs shopping malls department stores and luxury hotels, and in the summer formed a joint venture with internet firms Baidu and Tencent.

Wang took over the reins at the then state-run Wanda in 1989 and has since become one of China’s major business tycoons, with interests that also extend to a leading cinema chain. However, his paper-wealth plummeted during the Shanghai stock market rout in August 2015, as did the fortunes of others including a new breed of tech billionaire, such as Zhou Qunfei, chief executive officer of Lens Technology, a supplier of smartphone touch screens to Apple. Zhou is China’s richest women in the technology industry but doesn’t appear on the Rich List because of a lack of dividend payouts.
Yang Huiyan (15) is the richest women on the list and, at 34, also one of China’s youngest billionaires. Her father, Yeung Kwok Keung, founder of Country Garden Holdings in 2007, transferred his stake to her in 2007 and she is now vice chairman of the property developer. Country Garden raised $410 million from a new share offering last year and is a well-regarded borrower in the international bond markets.

Another property developer Shimao figures prominently in the Rich List. Its founder and controlling shareholder Hui Wing Mau (16) maintained a steady position in the table compared with last year, although his son and daughter now run his two publically listed companies.
He Xiangjian (17), who controls the Midea Group, China’s biggest household appliance maker, also keeps a constant position in the list, and like Hui, is no longer in charge of daily operations.

Examining dividend income to determine rich list

FinanceAsia analyses the publically listed assets of Asia (ex-Japan)’s leading business families and aggregates the dividends paid to them through their shareholdings or to their trusts or charitable foundations.

This methodology provides a more dynamic picture of wealth in the region than can be achieved by estimates of net worth, but clearly underestimates the fortunes of individuals and families whose wealth is mainly derived from non-income earning or wholly private assets. We identify a large universe of companies with large or controlling shareholders and gather information on ownership stakes and dividend payouts based on statements made to stock exchanges, newswires and, in the first instance, declarations made in annual reports.

Some holdings are opaque because ofcomplex cross-shareholding structures such as the Lee family’s control of
Samsung and the Keswick’s control of Jardine Matheson, so there are inevitable instances of under-reporting of some tycoon’s wealth.

 

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