Top Stock Highlights of the Week: Alibaba, GrabMaps and Frasers Hospitality Trust

Welcome to this week’s edition of top stock highlights, where we feature interesting snippets from a wide range of companies.

Alibaba Group (HKSE: 9988)

Bloomberg reported that Chinese financial regulators have started early-stage discussions to potentially revive the IPO of Ant Group Co, a unit of Alibaba Group.

The news was a revelation, given Ant Group’s history.

More than 18 months ago, Ant Group’s listing was halted as regulators were unhappy with Alibaba’s founder Jack Ma.

If Ant Group had listed successfully in both Hong Kong and the US, it would have been a US$37 billion floatation.

Alibaba’s shares had already been climbing steadily since 26 May, when it closed at HK$81.10.

In the last few days, the technology company’s shares surged by 16.1% to close at HK$107.6, ostensibly because of rumours surrounding this news.

However, in a twist, Chinese regulators have refuted Bloomberg’s news report, claiming that no such review or research was being conducted.

They did state that they support eligible platform companies that seek to list overseas.

Whether or not the news is true remains to be seen, but investors can take this IPO as an indication that China’s crackdown on technology companies may be coming to an end.

Investors have been left weary by the Chinese government’s harsh restrictions and rules over a wide variety of sectors ranging from private education to internet businesses.

Some relief from this ongoing pressure would indeed be welcome for investors.

Grab Holdings (NASDAQ: GRAB)

Grab has announced that it is launching a new enterprise service called GrabMaps to tap on the US$1 billion mapping and location-based services market within Southeast Asia.

This plan is yet another bold move by the super app company to add another line of business to its already burgeoning portfolio.

The company started as a ride-hailing business before venturing into food delivery and financial services.

For the first quarter of 2022, Grab reported a narrowing of its net loss but operating metrics showed a year on year improvement.

GrabMaps will be pitched to businesses that are looking for location solutions in densely-populated Asia and expects this service to be ready by the third quarter of this year.

Already, location-based services are being provided to seven out of eight countries in which the company operates, except for Indonesia.

In addition, Grab is also offering a software-as-a-service (SaaS) function that allows clients to build their maps.

This service includes Kartacam, a proprietary map-making camera that is supposedly 10 times cheaper than competing cameras.

An application programming interface and mobile software development kits are slated for launch later in 2022 and 2023, respectively.

If successful, Grab could see a steady recurring stream of revenue from offering mapping-as-a-service, a unique proposition that is well-aligned with the massive amounts of data that the super app collects daily.

Frasers Hospitality Trust (SGX: ACV)

Both Frasers Hospitality Trust, or FHT, and Frasers Property Limited (SGX: TQ5), or FPL, were halted on Thursday morning pending an announcement.

Bloomberg reported that Thai billionaire Charoen Sirivadhanabhakdi’s TCC Group is sourcing for a S$500 million loan to take FHT private.

TCC Group owns the majority of shares in both FHT and FPL and is working with a financial advisor to explore this potential privatisation.

Back in early April, there were rumblings of such an event occurring as the REIT received board approval to explore privatisation and had even hired a financial advisor.

Units of FHT had surged from around S$0.46 in late March to its current S$0.66 before the halt was announced, giving the hospitality REIT a market capitalisation of around S$1.26 billion.

FHT had reported recovery for its fiscal 2022’s first half ended 31 March 2022.

Gross revenue increased by 10.4% year on year to S$44.1 million while net property income rose 18.4% year on year to S$31.7 million.

Distribution per stapled security soared from S$0.00179 to S$0.007039 as 10% of the distributable income in the prior year was retained for working capital purposes.

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Disclaimer: Royston Yang does not own shares in any of the companies mentioned.

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