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Fathom China
Fathom China Team
Jan 30th 2019
Xi Jinping Demands Media Integration
The Communist Party has elevated its theme of “media integration” to the highest possible level: top leader Xi Jinping himself. Xi led the party’s ruling body, the 25-member Politburo, to the offices of People’s Daily on January 25 to drive home his demand that struggling state media adopt the practices of the country’s rising digital media giants. Although top-down calls for media integration have so far had little effect on VOD companies, in...
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Fathom China
Fathom China Team
Jan 11th 2019
Changes In Ratings, Bytedance Wants Long Video, And More
In this issue Big changes in ratings collection Rumor: Bytedance makes offer for Youku China VOD’s global influence New short video regulations New iQiyi vice president for short video iQiyi wins lawsuit against Bytedance
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Fathom China
Fathom China Team
Jan 01st 2019
Berry Genomics
Berry Genomics provides genetics testing equipment, reagents, and testing services to medical institutions. Its products and services mostly detect problem embryos and cancer. The company owns one production base and operates eight clinical laboratories in China and Hong Kong.
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Fathom China
Fathom China Team
Jan 01st 2019
Centre Testing International Group
Centre Testing International Group (“CTI”) provides independent testing services for product quality, safety and performance, on everything from toy cars to real cars.
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Fathom China
Fathom China Team
Jan 01st 2019
Zhejiang Dahua Technology
Dahua is the world’s second biggest seller of video surveillance products and services. Products include cameras, switches and servers. Services include “intelligent solutions” based on AI, video data analytics and cloud computing.
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Fathom China
Fathom China Team
Jan 01st 2019
Winning Health Technology Group
Winning Health provides software and hardware to medical institutions, which pay licensing and support fees. Its products share patient information among hospitals, insurance firms and others. It recently moved into cloud-based health services.
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Fathom China
Fathom China Team
Dec 18th 2018
Yirendai: Strategic Retreat
Yirendai ranks among China’s top companies in the troubled industry of online peer-to-peer lending, or P2P. Its platform puts together individual borrowers and lenders, and charges high fees. To protect consumers from usurious interest rates and Ponzi schemes, Beijing has passed a spate of regulations that are driving smaller firms out of business. Yirendai will likely rank among the survivors but with limited room for growth. The company’s...
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Fathom China
Fathom China Team
Dec 01st 2018
Focus Media Information Technology
This Quick A report is password protected and can only be opened by subscribers. To request access please contact info@gkfathomchina.com
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Fathom China
Fathom China Team
Dec 01st 2018
Lens Technology
Lens make glass covers for electronic devices, mostly mobile phones. It sells to makers like Apple and Samsung, and to OEMs like Foxconn. It has 95,000 employees.
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Fathom China
Fathom China Team
Dec 01st 2018
Hangzhou Tigermed Consulting
Tigermed tests drugs for pharmaceutical companies. This includes pre-clinical tests in laboratories, and clinical tests on humans. It also provides consulting and administrative services to help clients apply for approvals to test new drugs.
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Fathom China
Fathom China Team
Nov 14th 2018
Tencent Games: Culture Industry Under Pressure
The Chinese government in March 2018 stopped approving new online games. The cessation hurts Tencent Holdings (“Tencent”), which earns 37% of its revenue from games. A government restructuring that has clogged the approval pipeline is widely misunderstood. It is part of the Communist Party’s tightening grip on the audio-visual industry, including games. Game approvals will resume when the current phase of grip-tightening is complete, which is...
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Fathom China
Fathom China Team
Nov 01st 2018
BGI Genomics
This Quick A report is password protected and can only be opened by subscribers. To request access please contact info@gkfathomchina.com
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Fathom China
Fathom China Team
Nov 01st 2018
NavInfo
This Quick A report is password protected and can only be opened by subscribers. To request access please contact info@gkfathomchina.com
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Fathom China
Fathom China Team
Nov 01st 2018
S.F. Holding
This Quick A report is password protected and can only be opened by subscribers. To request access please contact info@gkfathomchina.com
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Fathom China
Fathom China Team
Nov 01st 2018
Wuliangye Yibin
This Quick A report is password protected and can only be opened by subscribers. To request access please contact info@gkfathomchina.com
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Fathom China
Fathom China Team
Oct 05th 2018
Autobio: Solid Reputation, Tight Executive Group
Autobio Diagnostics is poised to benefit from China’s booming healthcare services industry. The company has a good reputation but a few odd points. It has escaped controversy in an industry that is beset by scandal, although Fathom China thinks it should do a better job of explaining why its reported gross margins are so high.
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Fathom China
Fathom China Team
Aug 20th 2018
Dali Foods: Consumers Want More
Dali Foods Group (“Dali Foods”) is a large family-controlled maker of snack foods and drinks. It is known as a copycat that develops inexpensive me-too products, promotes them with celebrity-based marketing campaigns, and distributes them to lower-income consumers across vast swathes of China. Yet Dali Foods’ target demographic is shrinking as incomes rise, and even lower-end consumers are now looking for higher-quality fresh and healthy foods....
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Fathom China
Fathom China Team
Jun 29th 2018
Huayi Bros: Refocusing On Film
Privately run Huayi Brothers Media (“Huayi Bros”) was established in the 1990s by two brothers and still ranks among China’s most creative and successful moviemakers. The rise of China’s film industry over the past decade has forced changes in company strategy. Huayi Bros once enjoyed very close ties with China’s most creative directors and actors. As that talent increasingly sought work elsewhere, Huayi Bros responded by buying companies owned...
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Fathom China
Fathom China Team
Jun 01st 2018
Shenzhen Rapoo Technology
This Quick A report is password protected and can only be opened by subscribers. To request access please contact info@gkfathomchina.com
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Fathom China
Fathom China Team
Jun 01st 2018
Shenzhen Inovance Technology
This Quick A report is password protected and can only be opened by subscribers. To request access please contact info@gkfathomchina.com
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Fathom China
Fathom China Team
May 24th 2018
58.com: Strong Position In Online Listings
Attached is our report on China’s leading online listings business, 58.com, sometimes called the Craigslist of China. The company is in a strong position. It faces no major competitors in its two main business lines: real estate and blue-collar recruitment. Management looks steady. A series of restructurings raised concerns but 58.com seems to have come through well. This is one of Fathom China’s more upbeat reports.
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Fathom China
Fathom China Team
May 01st 2018
Zhejiang Supor
This Quick A report is password protected and can only be opened by subscribers. To request access please contact info@gkfathomchina.com
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Fathom China
Fathom China Team
Apr 27th 2018
YY: Contending With Short Video
Attached is our report on China’s pioneering livestreaming company, YY, which faces new challenges. The biggest is the quick rise of popular apps that share short videos and compete for eyeballs among YY’s user demographic. At the same time, more livestreaming competitors force YY to share more revenue with its hosts. Oddly, government crackdowns on livestreaming and short videos work to YY’s advantage by forcing its more adventurous competitors...
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Fathom China
Fathom China Team
Mar 29th 2018
BYD: New Subsidy Regime, New Battery Challenger
The world’s biggest maker of battery-powered vehicles, BYD, faces a tricky transition. Markets for the private company’s electric vehicles, or EVs, have long been driven by government subsidies for buyers. Beijing is curtailing subsidies for buyers in favor of incentives to boost supply. If Beijing’s scheme succeeds, BYD will almost certainly benefit. If not, then BYD will face a setback just as pressure from other EV makers grows. Meanwhile,...
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Fathom China
Fathom China Team
Jan 31st 2018
Beijing Enterprises Water Group: Local Finance Faces Freeze
Beijing Enterprises Water Group (“BEWG”) is China’s biggest water treatment company. The state-owned firm builds facilities to clean the water that flows into homes and factories, and to treat the sewage that flows out. It has also moved into restoring waterways that suffered heavy pollution during China’s 40-year industrial boom. Although state-owned, BEWG’s leaders come from an entrepreneurial private company acquired in 2008. Key to BEWG’s...
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Fathom China
Fathom China Team
Jan 03rd 2018
Hollysys: Beset By Challenges
Hollysys Automation Technologies (“Hollysys”) makes systems that control industrial processes such as power plants, rail lines and petrochemicals. The former state-owned firm was privatized and taken public through a reverse merger. Hollysys faces stiff challenges. It earns much of its revenue from small to mid-sized coal-fired power plants that are under pressure to close, and its railway systems face strong competitive pressure. The company is...
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Fathom China
Fathom China Team
Nov 10th 2017
CITS: Ringing The Register At Duty Free
China International Travel Service (“CITS”) is China’s biggest operator of duty-free stores. It is the listed arm of state-owned China National Travel Service Group (“CNTS Group”), which recently merged with a state-owned competitor. CITS entered duty-free in 1984, then in 2014 expanded the segment.
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Fathom China
Fathom China Team
Oct 13th 2017
Kweichow Moutai: New Markets Replace Old
State-owned Kweichow Moutai (“Moutai”) is China’s top maker of premium baijiu, the world’s most-consumed spirit. Moutai’s phenomenal brand is linked with quality, success and the Communist Party. And its fiery drink, also called Moutai, confers more status than any other China-made product. Moutai faced a crisis in 2012 when a crackdown on corruption and official extravagance hurt revenue. Through price cuts and broader distribution, Moutai...
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Fathom China
Fathom China Team
Aug 31st 2017
China Dairy: Mengniu Turns Sour, Yili Looks Creamy
China’s dairy industry is dominated by two giants who together control 33% of the market: China Mengniu Dairy (“Mengniu”) and Inner Mongolia Yili Industrial Group (“Yili”). Both face the twin problems of low milk prices and slow milk-consumption growth. The two seem to be converging from very different backgrounds. Mengniu started as a freewheeling private firm but was brought under government control; Yili started as a state-owned company but...
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Fathom China
Fathom China Team
Aug 22nd 2017
Baidu: Dumping Its On-Demand Business
Rumors say Baidu will sell off its on-demand services, ending its forays into offline business.
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Fathom China
Fathom China Team
Aug 08th 2017
Online Lottery: Hoping The Ban Lifts
China’s online lottery is forbidden fruit—juicy and banned. Selling online lottery products, including sports gambling, will almost certainly enable whatever companies receive a license to hit the revenue jackpot. The consensus opinion of people who profess to know the government’s thinking is that the 2015 ban will end, but when is anybody’s guess. Few expected it to last this long. Two companies will likely stand at the front of the line for...
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Fathom China
Fathom China Team
Jul 27th 2017
Dong-E E-Jiao: China’s Fad For Pricey Donkey Skins
Dong-E-E-Jiao (“Dong-E”) is China’s leading maker of ejiao, a traditional Chinese blood-strengthening medicine made from gelatinized donkey skins. The product is consumed mostly by women, who eat it in sweet little pieces or mixed into tea. Dong-E has been riding a boom in the traditional medicine market as increasingly wealthy Chinese people seek healthy lifestyles. The company has successfully targeted the premium market, enabling it to raise...
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Fathom China
Fathom China Team
Jul 07th 2017
Chinese Accounting Firms: Take That Grain Of Salt
China’s stock market watchdog recently punished two of China’s biggest auditing firms for helping clients cook their books, and the problem doubtless runs much deeper.
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Fathom China
Fathom China Team
Jun 30th 2017
Zhejiang Supor: Business Is Cooking
Zhejiang Supor (“Supor”) makes kitchen products. It is China’s biggest maker of cookware like pots, woks and pressure cookers, and is also a leading maker of appliances like rice cookers and soy-milk makers. Supor is controlled by French giant Groupe SEB (“SEB”), and is key to SEB’s strategy of collecting international brands and moving factories to China. Supor is SEB’s outsourced manufacturer, with about a third of production going to exports...
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Fathom China
Fathom China Team
Jun 26th 2017
LotSynergy: Clinging To A Contract
The main business of China LotSynergy Holdings until 2015 was to supply video lottery terminals – basically slot machines – to China’s lottery. Then LotSynergy lost its exclusive supply contract amid a corruption scandal in which top lottery officials vanished into detention. LotSynergy says it has the right of first refusal when the contract opens up for tender but Fathom China is skeptical.
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Fathom China
Fathom China Team
May 22nd 2017
AAC Technologies: Assessing A Short Attack
This Fathom China report assess a short-side attack on a Chinese firm. Fathom China has conducted no original research; our goal is instead to assess whether the attack has substance. Gotham City Research (“Gotham”) has issued two reports saying Shenzhen-based AAC Technologies Holdings (“AAC”) has used undisclosed related-party transactions to pad its margins. At the time this report was distributed, AAC had not responded to the accusations....
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Fathom China
Fathom China Team
May 16th 2017
Lens: Market Leader Has A Small Client Base
Lens Technology (“Lens”) is a leading maker of protective glass covers for mobile phones. The company was founded by a legendary entrepreneur, a rare self-made woman in an industry dominated by men. The company’s strength lies in making a low-tech product at huge scale. The technology is changing and Lens is playing catch-up to the next big thing—curved glass covers appearing on high-end handsets. Handset giants Apple and Samsung are Lens’s...
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Fathom China
Fathom China Team
Apr 28th 2017
Man Wah: Bubba Goes To Beijing
Man Wah Holdings (“Man Wah”) came from nowhere to dominate the US market for “motion upholstery,” otherwise known as reclining furniture. Family-run Man Wah operates vertically integrated furniture factories and sells under its own brand, Cheers. When its low-priced, innovative products hit US markets around 2007, they were just what American couch potatoes wanted, and revenue soared. Recent competition from Chinese rivals has forced Man Wah to...
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Fathom China
Fathom China Team
Apr 07th 2017
Hikvision: Creating Incentives
In an effort to spur executives to explore new industries, Hikvision creates an incentive plan that seems well balanced.
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Fathom China
Fathom China Team
Mar 31st 2017
Inovance: Expanding Into New Markets
Shenzhen Inovance Technology (“Inovance”) is a leader in industrial automation control products for middle- to high-end manufacturers. The private company’s main product is an “inverter” that switches direct current to alternating current. The biggest market for Inovance’s inverters is elevators in buildings, and Inovance has also moved into more sophisticated devices such as motor-control components for battery-powered vehicles. Inovance stands...
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Fathom China
Fathom China Team
Mar 17th 2017
Baidu: Head Of Troubled Unit Sacked For Kickbacks
In a sign of Baidu’s floundering effort to expand its business beyond search advertising, the company has sacked the head of Nuomi, its once high-flying platform for on-demand services similar to Yelp.
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Fathom China
Fathom China Team
Mar 13th 2017
China Lodging: Facing Angry Franchisees
China’s second-biggest hotel chain, China Lodging Group (“China Lodging”) is well run and has a sound expansion plan. The company’s franchise model has allowed it to grow fast and meet strong demand for low-priced hotels; now it is moving into mid-priced hotels. Yet China Lodging faces a big new challenge: angry and empowered franchisees. The company’s franchisees in mid 2016 created a collective-bargaining organization and launched street...
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Fathom China
Fathom China Team
Feb 28th 2017
Great Wall: Steering Through New Regulations
China’s leading SUV maker could be hurt by changing regulations that encourage fuel-efficient cars, especially cars powered by batteries.
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Fathom China
Fathom China Team
Feb 17th 2017
Netease: Dividend Obstacles Surmountable
The Chinese government has shown no inclination to block dividend payments by overseas listed firms, although Internet companies should make sure their main assets do not lie within variable-interest entities.
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Fathom China
Fathom China Team
Feb 08th 2017
iFlytek: The Product Is Sound
iFlytek is China’s leading maker of speech software, which involves the advanced fields of machine learning and artificial intelligence. The firm licenses its technology to clients,such as makers of mobile phones who need Siri-like voice-activated command systems. iFlytek has not succeeded in selling consumers products of its own. Its academic approach to business, overseen by a stable corps of executives, has yielded terrific research but the...
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Fathom China
Fathom China Team
Feb 02nd 2017
Yunnan Baiyao: New Shareholder’s Plans Under Wraps
A leading state-run company making traditional medicine has fallen into the hands of a billionaire entrepreneur who failed to acquire the firm in 2009, and whose plans for his new prize remain hidden.
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Fathom China
Fathom China Team
Jan 19th 2017
Xinyi Solar: Sunny Year Ahead
Xinyi Solar Holdings (“Xinyi Solar”) is China’s biggest maker of glass for solar cells, which are arrayed into solar panels to generate power from the sun. The company was in 2013 spun off from Xinyi Glass Holdings (“Xinyi Glass”), the subject of a related Fathom Profile in January 2017. Family-run Xinyi Solar is well managed and enjoys a good reputation, and its political connections run to the highest level of the Communist Party. Its clients...
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Fathom China
Fathom China Team
Jan 12th 2017
Fang Holdings: Home Seller’s Business Needs Renovation
Fathom China’s negative assessment in May 2015 of Fang Holdings holds up about as well as the online home-sales company’s strategy looks dilapidated, and aggrieved former clients are now enjoying the last laugh.
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Fathom China
Fathom China Team
Jan 09th 2017
Xinyi Glass: Strong Company, Fragile Market
Xinyi Glass Holdings (“Xinyi Glass”) ranks among China’s top glass makers. Its main product is float glass, most of which is sold directly to construction companies. Some of Xinyi Glass’s float glass is also processed into higher-margin products such as insulated or tinted construction glass, or automobile glass. Family-run Xinyi Glass is well managed and enjoys a good reputation. Its main challenges are external – the float glass industry is...
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Fathom China
Fathom China Team
Dec 20th 2016
Toread: Too Many Business Adventures
Toread Holding Group (“Toread”) is China’s biggest brand of outdoor products including jackets, boots and tents. Sales have stagnated, forcing Toread to close many of its stores. Recent events suggest that franchisees may hold excess inventory. In an effort to find new markets, the ambitious family-run company has launched a multi-brand strategy for its outdoor gear, and expanded quickly into new businesses. It has invested heavily in travel...