Close menu

October 18th, 2021 | 12:02 CEST

China Evergrande, AdTiger, Geely - Great opportunities in China

  • Digitization
Photo credits:

China cannot get out of the negative headlines. After the government accelerates the regulation of domestic technology groups, the Middle Kingdom is facing the next problem. The impending collapse of Chinese real estate giant Evergrande has been preoccupying the markets for weeks. However, due to the strong correction in recent months, there are attractive entry opportunities, especially in the technology sector. Charlie Munger, for example, long-time business partner of investment legend Warren Buffett, massively increased his stake in online giant Alibaba in the last quarter, according to a report in the Daily Journal.

time to read: 4 minutes | Author: Stefan Feulner

Table of contents:

    Risks manageable

    It is still unclear how much the Evergrande crisis will spread to other industries. The fact is, the group is sitting on a debt mountain of more than USD 300 billion, and several deadlines for interest payments due to bondholders have already passed. Given the size of the liabilities, there is widespread concern that a collapse of Evergrande could trigger a conflagration in the Chinese real estate sector. China's central bank has now spoken out at a press conference and described the risks to the financial system as manageable. It is also unlikely that the Evergrande crisis will spread to other sectors.

    Meanwhile, the management of the ailing real estate giant is trying to save what can still be saved by selling assets. Meanwhile, a sale of the Hong Kong headquarters for around USD 1.7 billion has fallen through. According to well-informed sources, Yuexiu Property, a real estate developer owned by the state, has pulled out of the talks given Evergrande's difficult financial situation. The struggling group could face further trouble from Hong Kong's accounting regulator. The Financial Reporting Council (FRC) is reviewing the 2020 financial statements and the 2021 half-year financial statements, and PwC's auditors are also scrutinizing the 2020 financial statements. The focus will be on the appropriateness of the consolidated financial statements as well as the audit report.

    Regulations promote smaller companies

    During the year, regulatory tightening has been applied specifically to Chinese tech giants such as Alibaba, Baidu, and Tencent. The Chinese government's goal is likely to have been, among other things, to limit the power position of monopolists and oligopolists and to stop such practices as forcing merchants to sign exclusive contracts, as well as to restrict predatory marketing.

    In turn, this promotes competition and creates an environment in which smaller companies can grow. A good example of this is the fastest growing digital marketing company in 2020, AdTiger. The already profitable Company received this award at the 20th IAI International Advertising Awards. AdTiger is one of the leading digital marketing companies in the Asian region. The growth rates in this segment are enormous, with annual increases of over 25%. AdTiger's clientele is a "who's who" of Chinese Fortune 50 companies. Sina, Futu, Netease and Baidu are just a few examples. The Company offers digital marketing solutions for its clientele and helps them with marketing and sales. The aim is, among other things, to build brands and expand the customer base.

    With Big Data and AI

    In contrast, AdTiger, using Big Data and algorithms as the core of its AdTensor platform, uses the leading Internet media platforms to gain access to globally active Internet users. In doing so, AdTiger can draw on several years of successful partnerships with global players. AdTiger is Google's primary advertising agency in China and has been one of Facebook's export partners for 8 years. In addition, the China-based holding Company cooperates closely with TikTok, Bigo and WeChat Video and was named Snapchat's "Lens Creative Partner."

    Over the past year, AdTiger has had to make a geographic pivot toward the Chinese advertising market. Due to the swelling trade conflict with the US and the collapse of the Indian market as a result of the Corona pandemic, the focus was shifted to the Middle Kingdom. The upheaval resulted in a one-time drop in profits of about 40% in the first half of the year. Despite the one-time effect, however, AdTiger's future looks bright. The China-based holding Company wants to grow through strategic cooperations and acquisitions of various apps and further expansion into ASEAN countries such as Indonesia, Singapore and Vietnam. The Company's stock market value is EUR 48.28 million. In contrast to the beginning of the stock market year, investors are currently receiving a 50% discount on the share price.

    Electric humming

    Almost 20% fewer cars were sold in China in September. Due to the shortage of semiconductor components, sales declined for the fifth consecutive month, with a total of 2.07 million cars delivered. However, this figure includes vehicles with internal combustion engines. By contrast, sales of alternative drive systems - including electric vehicles, plug-in hybrids and fuel cell vehicles - rose sharply. 357,000 units represent a doubling compared with the previous month.

    Daimler's partner Company, Geely, was also unable to escape this trend. A total of 103,936 units crossed the counter, representing a decline of 18% compared to the previous month. In the alternative drive segment, the Company recorded a whopping 26.6% month-on-month increase with 11,177 automobiles compared to 8201.

    By breaking above the prominent resistance line at EUR 2.60, Geely could generate a buy signal.

    How much does the crisis surrounding the stumbling Evergrande real estate group impact the economy? The activities of the Chinese regulatory authorities have also led to a significant correction in tech stocks in recent months. AdTiger was unable to escape this, but the business is growing strongly. Geely is also attractive at the current level.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and etc. on These contents serve information for readers and does not constitute a call to action or recommendations, neither explicitly nor implicitly. implicitly, they are to be understood as an assurance of possible price be understood. The contents do not replace individual professional investment advice and do not constitute an offer to sell the share(s) offer to sell the share(s) or other financial instrument(s) in question, nor is it an nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but rather financial analysis, but rather journalistic or advertising texts. Readers or users who make investment decisions or carry out transactions on the basis decisions or transactions on the basis of the information provided here act completely at their own risk. There is no contractual relationship between between Apaton Finance GmbH and its readers or the users of its offers. users of its offers, as our information only refers to the company and not to the company, but not to the investment decision of the reader or user. or user.

    The acquisition of financial instruments entails high risks that can lead to the total loss of the capital invested. The information published by Apaton Finance GmbH and its authors are based on careful research on careful research, nevertheless no liability for financial losses financial losses or a content guarantee for topicality, correctness, adequacy and completeness of the contents offered here. contents offered here. Please also note our Terms of use.

    Der Autor

    Stefan Feulner

    The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
    He is passionate about analyzing a wide variety of business models and investigating new trends.

    About the author

    Related comments:

    Commented by Stefan Feulner on November 2nd, 2023 | 07:10 CET

    These companies defy the crisis - TeamViewer, Smartbroker Holding AG, JinkoSolar

    • Investments
    • Technology
    • Solar
    • Digitization

    The past weeks have brought many negative surprises with the publication of the figures for the third quarter. Last week, in addition to Volkswagen, Mercedes Benz and Hypoport also lowered their forecasts. However, there were also companies that performed better than expected by the consensus of analysts despite the difficult conditions. It is precisely here that enormous turnaround opportunities lie due to the consolidation of the past months.


    Commented by Juliane Zielonka on August 31st, 2023 | 09:05 CEST

    Strategic turning points in Chemicals, Automotive and Energy: Investment opportunities with Defense Metals, Volkswagen and BASF

    • Mining
    • RareEarths
    • Electromobility
    • Digitization

    Rare earths are becoming increasingly important due to digitalization, especially for the electronics industry. Defense Metals, a company from Canada, is focusing on the extraction of rare earths at the Wicheeda project. Geotechnical investigations are progressing rapidly in order to develop the valuable raw material. Volkswagen reports an impressive 17.9% increase in car sales in July. Nevertheless, the Company is lowering its annual sales forecast due to growing competition in China. Germany's energy transition is affecting major corporations like BASF. The US company Cheniere Energy will supply BASF with liquefied gas in the future. To adapt to the new market conditions, BASF has successfully completed the spin-off of its mobile exhaust catalyst and precious metal services businesses. The new site surprises.


    Commented by Stefan Feulner on June 22nd, 2023 | 08:20 CEST

    PayPal, Star Navigation Systems, Palantir - Fully on course

    • Digitization
    • Technology
    • Software
    • AI

    Since the start of generative AI around Chat GPT, Google Bard & Co at the latest, artificial intelligence has become mainstream. There are many beneficiaries of the hype, above all, the graphics card specialist Nvidia, which exceeded the average expectations of analysts by about 50% with its current sales forecast. The reason for these numbers surpassing the consensus was the Company's "incredible orders" for data center upgrades. In addition to Nvidia, lesser-known companies are also benefiting from the revolution based on information and communication technology.