Huaneng Power International Inc.
Question No. 1
You have been hired as an international investment banker by a large U.S. institutional investor who is considering purchasing HPI stock. Provide an analysis of i) China as an investment destination, ii) key success factors, and iii) HPI's strengths and weaknesses.
China, officially the People's Republic of China is the world's largest country by population and one of the largest by area, measuring about the same size as the United States. The country's varied terrain includes vast deserts, towering mountains, high plateaus, and broad plains. Beijing, located in the north, is China's capital and its cultural, economic, and communications center. Shanghai, located near the Yangtze, is the most populous urban center, the largest industrial and commercial city, and mainland China's leading port. One-fifth of the world's population--1.2 billion people—live in China. China recognizes more than 5O national minorities and many different regional languages. As a result of the reforms of the 1980s and 1990s, the Chinese economy grew almost 10 percent a year from 1980 to 2005, making it one of the largest economies in the world in the early 21st century.
China also opened its market to the outside world. To help quicken the pace of modernization, the state encouraged foreign investment and the import of advanced technology. In 1980 China began establishing special zones for foreign investment. The original four were called Special Economic Zones (SEZs) and consisted of Shenzhen, Zhuhai, Shandou, and Xiamen, all in southeastern China. By the late 1990s a variety of similar types of zones had been added, including a fifth SEZ, Hainan Island.
Most zones are located in urban economic centers, particularly coastal cities, cities along the
Yangtze River, provincial capitals, and cities and towns along China's borders.
In 1992 the government announced the goal of establishing a socialist market economy, meaning a market economy led by the CCP. To accommodate this
You have been hired as an international investment banker by a large U.S. institutional investor who is considering purchasing HPI stock. Provide an analysis of i) China as an investment destination, ii) key success factors, and iii) HPI's strengths and weaknesses.
China, officially the People's Republic of China is the world's largest country by population and one of the largest by area, measuring about the same size as the United States. The country's varied terrain includes vast deserts, towering mountains, high plateaus, and broad plains. Beijing, located in the north, is China's capital and its cultural, economic, and communications center. Shanghai, located near the Yangtze, is the most populous urban center, the largest industrial and commercial city, and mainland China's leading port. One-fifth of the world's population--1.2 billion people—live in China. China recognizes more than 5O national minorities and many different regional languages. As a result of the reforms of the 1980s and 1990s, the Chinese economy grew almost 10 percent a year from 1980 to 2005, making it one of the largest economies in the world in the early 21st century.
China also opened its market to the outside world. To help quicken the pace of modernization, the state encouraged foreign investment and the import of advanced technology. In 1980 China began establishing special zones for foreign investment. The original four were called Special Economic Zones (SEZs) and consisted of Shenzhen, Zhuhai, Shandou, and Xiamen, all in southeastern China. By the late 1990s a variety of similar types of zones had been added, including a fifth SEZ, Hainan Island.
Most zones are located in urban economic centers, particularly coastal cities, cities along the
Yangtze River, provincial capitals, and cities and towns along China's borders.
In 1992 the government announced the goal of establishing a socialist market economy, meaning a market economy led by the CCP. To accommodate this