Tracker newsletter adds PE analysis

We have been tracking the stocks of Asian listed B2B media companies since 2001. Today, we added to our Asian Business Media Tracker service a new feature; a weekly report on PE ratios of the companies listed in Asia which we follow.

This is published in the subscriber version of our weekly newsletter. A free version of the newsletter, without the PE tables and many other important features, can be obtained with a sign-up form on our website (at the bottom of the Tracker page....yes, it needs a clearer link....work in progress).

Results of the first week's analysis show that the highest PE of the companies we track is Info Communication (the parent company of Paper Communication Exhibitions) at 137.3. This makes 5th placed Alibaba look quite modest at a mere 66.3. The 'cheapest' stock in our table is Tokyo-listed Xinhua Finance at a bargain 3.1.

Of the 23 stocks we track, 9 have no real PE as they are loss-making.

BSG announces link with Cue Ball

PRESS RELEASE

BSG announces link with Cue Ball

Hong Kong, 10^th April: Business Strategies Group Ltd. (BSG), Asia’s only consultancy focusing on the business media, information and events industries, is pleased to announce a new alliance with Cue Ball LLC, advisors and brokers to global media. BSG will assist Cue Ball in the licensing of its client's B2B properties throughout Asia.

For Cue Ball, BSG will represent the B2B properties, brands and services of Nielsen Business Media (www.nielsenbusinessmedia.com), Vance Publishing Corporation (www.vancepublishing.com) and BowTie Inc. (www.bowtieinc.com). Other trade media groups could be added to BSG's licensing brokerage services in the future.

Cue Ball’s CEO John Cabell commented “the growing markets of Asia obviously represent very exciting opportunities to many international publishers. We are very pleased to be able to work with Paul Woodward and his team at BSG to bring together our portfolio of leading international publishers and their network of contacts across Asia”.

On behalf of BSG, Paul Woodward noted “as Asia’s publishers continue to build their B2B activities, there are many interesting new ways in which they can work together with the well-established publishers in North America and elsewhere in the world who are represented by Cue Ball. We look forward to developing this exciting new part of our business”.

B2B publishers in Asia who are interested in these opportunities should contact BSG CEO Paul Woodward or Director Kim Cheng for more information.

For the full announcement, see the BSG website at www.bsgasia.com.

For information, please contact:

Paul Woodward, Principal, Business Strategies Group Ltd.

Tel: +852 2525 6163

e-mail: paul at bsgasia.com

John Cabell, CEO, Cue Ball LLC

Tel: +1 (505) 466-4826

e-mail: info at cueballdigital.com

BSG quoted in TradeShow Week article

TradeShow Week magazine in the US has put together a very thorough review of the possible impact of economic slowdown on the exhibitions business. Given the publciation's focus, it naturally concentrates on the US situation. It does, however, also report on the possible impact on China and Editor Michael Hart interview BSG's Paul Woodward, CMP Asia's Michael Duck and CIEC's Zheng Shijun for the article. Highlights:-

“We recorded 30-percent growth in 2006,” Woodward said. “It seems impossible to continue that in '07. If there is any slowdown, it's probably more of a maturing process. In other words, there might be 8- or 9-percent growth instead of 30 (percent).”

“If South China is going to get some slowdown in manufacturing because of a slowdown in orders from the U.S., then there could be something latent to care about,” Duck said.

The China Import & Export Fair, better known as the Canton Fair, takes place April 15-30 in Guangzhou, and sections of the China Sourcing Fair take place April 12-15 and April 20-23 at AsiaWorld-Expo in Hong Kong.

“Those are entirely driven by exports,” Woodward said. “The attendance figures there will be very interesting to watch.”

“It's still a little early to tell,” Woodward said. “We're just getting into the main trade fair season.”

But go ahead and read the whole piece. It's very interesting.

BSG releases report on Global Sources

PRESS RELEASE

Global Sources moves to consolidate position with large retail buyers

Hong Kong, 13th March: Business Strategies Group (BSG), the only consultancy in Asia specialising in B2B media and events, has released a new report profiling Global Sources. 2007 was a good year for Global Sources. Revenues grew by 16% reaching US$182 million. GAAP net income was US$24 million – down 15% from the 2006 figure primarily due to the write down of an acquisition and increasing non-cash compensation expenses.

The report also notes some key developments in Global Sources’ strategy in 2007.

• The company continues to refine its strategic focus on large buyers by holding over 80 private sourcing events and strengthening the supplier verification services that they provide. BSG concludes that the successful execution of this strategy will be a key component of creating differentiation between Global Sources and the more SMEfocused Alibaba.com.
• In November, Global Sources entered China’s online domestic sourcing market with the launch of www.globalsources.com.cn. BSG comments that this will put the company in head-to-head competition with Alibaba.com’s Chinese language sourcing site. Alibaba.com has a formidable head start and it will be interesting to see how much traction Global Sources can gain in 2008.
• The report notes that Global Sources is committed to growing its presence in India in 2008. It has said that it will add sales staff, launch new exhibitions there and host private sourcing events which target large retail buyers.

BSG Principal, Paul Woodward, commented “we are expecting another eventful year for Global Sources – one of the most important companies we cover - as they focus resources on building up their presence in India as well as their domestic B2B sourcing service in mainland China. It will also be important to keep a close watch on their efforts to offer deeper supplier verification services which is a key component in their strategy to serve the larger buyer segment and differentiate their company from Alibaba.com.”

This BSG report was distributed on 12th March to BSG subscribers of its Asian Business Media Tracker service. The report features over 20 pages of information and analysis covering Global Sources key products, competitors, financial data and a review of the company’s overall corporate strategy. It is also available for purchase on a stand-alone basis.

ENDS

New look BSG web site

The original BSG web site had been doing sterling service since early 2001. Without any major updates in design, it was getting a little hard to manage. So, not before time, my colleagues Kim and Wing have been working for a while on this new look site which is up today.

Nice job ladies!!

Delegates happy with BSG-managed seminar

UFI Press Release

The 170 delegates from 23 countries and regions meeting in Macau for UFI’s third Open Seminar in Asia have expressed high levels of satisfaction about the event. Focusing on the topic “New Exhibition Opportunities for Asia”, the seminar was hosted by the new Venetian Macau Resort & Hotel.

“This meeting is going from strength to strength” said UFI’s Managing Director, Vincent Gerard who was in Macau for the event. “We were wonderfully looked after by the Venetian which is a spectacular venue and the programme really seems to have struck a chord with delegates. The room was full from the first session to the last”. The meeting included some of the new features adopted in UFI’s European Seminar in Bilbao in June last year. These included “ask the expert” sessions, interactive panels and structured networking.

Speakers included Brand Events’ Chris Hughes and Media 10’s Lee Newton who both challenged delegates to think innovatively about how consumer events can evolve away from traditional exhibitions. A panel comprising Interads India’s Rajan Sharma, David Zhong of VNU Exhibitions Asia and Fiera Milano’s Shahin Javidi then gave some very different perspectives on the potential impact of joint ventures on exhibitions in Asia. This was clearly important to the audience as delegates voted 99% in favour of the view that more joint ventures are likely in the future in Asia.

Day Two saw Prof. Per Mollerup from Denmark wake delegates up with a very stimulating talk on “wayshowing”; his concept of how to reorganise venues and events so that they serve attendees various needs much better. CMP’s Michael Duck, David Zhong and Asia/Pacific Chapter Chairman Chen Xianjin then discussed various opportunities for regional trade fairs in China and India. All agreed that these would become increasingly important in the near future.

In the final session, Singapore’s Edward Liu was the expert who answered delegates questions about his views on operating in challenging markets. Vietnam was high on the mind of a number of the questioners. Finally, Pradeep Gupta, the CEO of Cybermedia from India, talked delegates through the different types of events which have emerged in the high tech sector.

As usual, delegates spent a good deal of time networking including using the Expostudio web-based appointments system and the social functions. These included an evening reception at the Macau TV Tower hosted by the Macau Trade & Investment Promotion Institute and a lunch hosted by the Macau Government Tourism Office.

Next year’s UFI Open Seminar in Asia will take place at the Kuala Lumpur Convention & Exhibition Centre on February 12 – 13.

Paul Woodward on B2B media trends

Thanks to Thomas Crampton for putting together this interview in the NextMedia studios. His full blog posting on this is here. We talked for 10 minutes about key B2B media trends including;

1. The impact of manufacturing's move away from South China and Shanghai on B2B media;
2. The increasing importance of regional markets within India and China;
3. The impact of economic slowdown on the activities of major western B2B media companies in Asia, and;
4. The ways in which print is being by-passed in direct-to-online launch strategies in Asia.
   

Final speaker confirmed for Macau

The 2008 UFI Open Seminar in Asia, managed by BSG, takes place next week in Macau. We're going to be looking at a variety of ideas for new types of events. I am really delighted with the quality of the group of speakers who will come together for this and have just confirmed the final participant in our panel on joint ventures.

Shaheen Javidi is the Chief Marketing Officer of Fiera Milano and will join David Zhong of VNU Exhibitions Asia and Rajan Sharma, Managing Director of Inter Ads India to discuss whether JVs still represent the most valuable future trend for business development. Delegates will be particularly keen to hear Javidi's insights following the recent confirmation of the joint venture for international business development between Fiera Milano and Deutsche Messe AG (Hanover).

BSG quoted in reports on MSFT/Yahoo! impact on Alibaba

We noted in our Asia Business Media blog yesterday that Microsoft's bid for Yahoo! was causing a fair bit of excitement in relation to Alibaba.com. One of the calls we received was from Xinhua Finance News who's piece is here:

"Alibaba.com appears to be riding on the back of the big surge in Yahoo's share price following news of Microsoft's takeover bid for Yahoo," said Paul Woodward, principal at information technology consultancy firm Business Strategies Group.

"I don't think there is any case yet of anyone, such as Microsoft, showing interest in acquiring Alibaba.com which is small relative to global players," he said.

I won't be going back on the Alibaba Christmas card list any time soon with later comments in the piece about valuations. Not that anybody takes too much notice of what I'm saying on this. I see the stock is up another almost 5% this morning.

Mail server troubles

BSG's mail server appears to have taken an early Chinese New Year holiday (along with the technician who runs it who is also AWOL). So, mail sent to us since Thursday evening Asia time is stuck somewhere.

In the meantime, please feel free to send me e-mail at paulw at netvigator.com or, for BSG in general, bsginfo at biznetvigator.com. We'll let you all know once we're back online...and with a new mail server service provider!!

Update: All better now! Please feel free to use our bsgasia.com e-mail addresses again. More robust systems on the way.

Press release on new BSG report

PRESS RELEASE

M&A activity in Asian B2B media sector increases by 75% in 2007

Hong Kong, 31st January: Business Strategies Group (BSG), the only consultancy in Asia specialising in B2B media and events, has released a new report tracking mergers and acquisitions (M&A) in Asia’s B2B media sector.

In 2007, the total value of M&A activity in this industry hit a new high of US$470 million. That is a 75% increase over the US$269 million recorded in 2006.

In 2007, there were 33 transactions – 50% more than the 22 deals in 2006. The average deal size was US$14.2 million which was an increase of 16% over the previous year. Significant deals in 2007 included:

· India-based Network 18’s purchase of 40% of Infomedia for US$45 million. The stake was acquired from ICICI, an Indian bank.
· Tarsus’ trade show-related acquisitions in India including its purchase of the India Label Show as well as a significant investment in Montgomery India Limited.
· The sale of a significant stake in Thailand’s IMPACT Arena to a foreign investor for an undisclosed sum. The convention and exhibition venue features of 136,000 square metres.
· Xinhua Financial was particularly active in 2007 closing four deals valued over US$90 million.

BSG is forecasting 37 deals worth US$650 million in 2008 – an increase of close to 40% over the 2007 figure. This substantial growth will be driven by deal flow from India and continued purchases by industry majors including Reed\ and CMP. Alibaba.com is also expected to begin to play a significant role in the industry’s M&A activity in 2008. The company has indicated that it plans to use a significant portion of its IPO proceeds to acquire existing businesses.

BSG Principal, Paul Woodward, commented “we are forecasting 2008 to be another year of dramatic M&A growth in Asia’s B2B media industry. Continued economic growth in China and India and a potential slowdown in the U.S. will further heighten interest in the region’s B2B media firms. BSG anticipates that all eyes will be on Alibaba.com and their war chest of US$1.7 billion.”

This BSG report was distributed on 29th January to BSG subscribers of its Asian Business Media Tracker service. It is also available for purchase on a stand-alone basis.

ENDS

Carbon offsets

Running an international business is exciting and many of us love visiting different parts of the world as part of the work that we do. Over the past three years, I've averaged 63 flights and around 205,000km a year. Other colleagues are flying a fair bit, if not that far. I have been thinking for a while that this gives us big fat and not very green carbon footprint.

I was, therefore, pleased to see the Cathay Pacific/Dragonair flyGreener initiative. I am planning to use this service to pay an appropriate offset for all the travel that BSG staff and I do on business in 2008. I'm going to keep track of how much carbon we contribute and will post here on how we go about those offset.

Interesting to read the Economist's take on how poorly most companies are doing in this whole area of CSR, despite many good intentions.

Important new Tracker report released

PRESS RELEASE

BSG releases ranking of publicly-listed Asian B2B media companies

Hong Kong, 14^th January: Business Strategies Group (BSG), the only consultancy in Asia specialising in B2B media and events, has released a new report covering all publicly-traded Asian B2B media companies. The report ranks 25 companies by revenue, gross profit and market capitalisation. It also provides profiles of all 25 companies featuring key financial metrics, the share price performance over the past 12 months and other data such as key shareholders and core business description.

In terms of revenues, Pico Far East, which provides marketing, logistical and advertising services to exhibition organizers, is the largest with revenues of US$231 million. Alibaba.com is a new-comer to BSG’s ranking. The company debuts in the number two position with revenues of US$176 million in 2006. The Hong Kong Trade Development Council (HKTDC) with revenues of nearly US$173 million for its publishing and exhibitions activities ranks third. Xinhua Finance (US$167 million) and Global Sources (US$156 million) round out the top five.

As of 8 January, the market capitalization of the top 25 companies ranges from Alibaba.com’s US$16.8 billion down to Hong Kong-listed CCID Consulting which has a market capitalization of just US$7.7 million. Three companies have a market cap of over US$1 billion – Alibaba.com, Baidu (US$11.4 billion) and Global Sources (US$1.1 billion). Surprisingly, Shenzhen-listed Zhejiang Netsun with revenues of just US$8 million ranks fourth with a market cap of US$604 million. NASDAQ-listed Xinhua Finance Media completes the top five with a market capitalization of US$383 million.

BSG Principal, Paul Woodward, commented “we expect the top five companies to continue to expand rapidly. Both Alibaba.com and Xinhua Financial recently completed IPOs and BSG anticipates that both companies will pursue acquisitions as a means of growth. Meanwhile, Global Sources is also aggressively expanding its successful series of sourcing trade shows in new locations such as Dubai and India.”

This BSG report was distributed on 10^th January to BSG subscribers of its Asian Business Media Tracker service. It is also available for purchase on a stand-alone basis.

ENDS

Holiday Greetings from the BSG team

A really great team!

BSG gets its own Facebook page

Having teenagers keeps you young....which is why BSG now has its very own Facebook page. We're trying this all out to try to work out whether it's relevant to our business or to our clients'. We'll be keeping everybody posted.

BSG quoted in Global Sources earnings call

Thanks for Global Sources CEO Merle Hinrichs for quoting us during yesterday's conference call with analysts reviewing the company's Q3 results. He said:

According to the BSG, a Hong Kong based Consulting Company, Global Sources is now the second largest Trade Shows organizer in Hong Kong after just two years in the business in Hong Kong.

He was quoting from our report on the South China exhibitions industry which was distributed last month to subscribers to BSG's Asia Business Media Tracker service.

BSG mentioned in Folio article

Many thanks to Plastic News' Bob Grace for mentioning us in his interesting interview with Folio on e-publishing in China. The article says:

Plastics News took a digital-only approach for two reasons: one, the Chinese government requires foreign publishers to partner with a Chinese publisher on all print ventures (but not digital); and two, distributing a print news publication in a country the size of China would have been both prohibitively expensive and inefficient. “We wanted to try to sidestep or postpone that and get our brand known. We do breaking news and our Web site turned us into a global news service,” says Robert Grace, editor and associate publisher.

Crain executives took some initial trips to China and met with publishing consultant Paul Woodward of BSG Asia. They also contacted trade associations and asked the Chinese customers of their Western customers if they’d be willing to share marketing lists.

Thanks Bob!

The article mentions that you don't need a Chinese partner for e-publishing ventures which isn't quite true. If you want to locate a web site on servers in China, then the restrictions on foreign-owned publishing are similar to those for print (although with different regulators). If you publish in Chinese from outside China, however, it's perfectly feasible to go it alone.

BSG caught up in Ali-frenzy

A number of press reports have picked up quotes on us today including:

Associated Press: "It's a great company. But it's very much a proxy for China, the Internet and the appeal of its founder, Jack Ma, and (the price) has nothing at all to do with the business fundamentals put on the table," Paul Woodward, business media consultant at Business Strategies Group, which values the entire business-to-business market in mainland China at $1.41 billion.

BSG releases to report to susbcribers

PRESS RELEASE

Comprehensive report on Alibaba.com comments on market value and competition

Hong Kong, 5^th November: A report just published in Hong Kong provides unique analysis of Alibaba.com, the divisions of the Alibaba Group to be listed on the Hong Kong Stock Exchange on 6^th November. The report has been researched and written by the only consultancy in Asia specializing in B2B media, information and events, Business Strategies Group Ltd. (BSG).

Alibaba.com is the B2B division of the Alibaba Group. When its stocks start trading on the Hong Kong market, it will be valued at some US$8.8 billion – almost five times BSG’s estimated total size of the China B2B media market in 2007. BSG’s estimates the total B2B media marketplace in mainland China including exhibitions, online and magazines in 2006 was US$1.41 billion. This market is growing rapidly at 25 – 30% a year, but despite the strong growth, Alibaba.com’s IPO still values the company at several times the total market size.

BSG Principal, Paul Woodward, commented “there is justifiably a huge amount of interest in Alibaba. It’s an exciting company and combines some of the most interesting aspects of China and the Internet. However, there hasn’t so far been too much effort to place the parts of the company being listed in the context of the market in which they operate. It’s not the general Internet business being listed here, but the B2B media operations. That’s not the same thing and careful comparisons are required”.

The report includes a detailed comparison with Nasdaq-listed Global Sources, Alibaba.com’s most direct competitor among B2B media companies. It also describes possible strategies that BSG’s consulting team believes Alibaba.com will pursue in order to justify the huge valuation given by the market to the company at the time of its IPO.

The report BSG has produced was distributed on 2^nd November to subscribers of its Asian Business Media Tracker service. It is also available for purchase on a stand-alone basis.

ENDS