Recruiting in China

China's manufacturing purchasing managers index continued rising in November to the highest level in two years, which indicates the country's economic performance is gradually improving, new data showed on Thursday.

The PMI stood at 51.7 in November, up from 51.2 in October, according to the National Bureau of Statistics.

This is the fourth consecutive month that the manufacturing PMI, a key gauge that monitors the activity of large and medium-sized enterprises in the manufacturing sector, stayed above the 50-point mark that distinguishes expansion from contraction in the sector.

Among the five major subindexes, production and new orders stayed in the expansionary range. In November, the production subindex increased to 53.9 from October's 53.3, while the new orders subindex increased to 53.2 from October's 52.8. Both were at the highest level so far this year.

Zhao Qinghe, senior statistician of the NBS, said that production and market demand both rebounded in November, and enterprises showed stronger desire to purchase.

Zhao said the increased costs of raw materials and transportation, which have reached the highest level in three years, are a major challenge for enterprises.

"Fluctuations of the RMB exchange rate have resulted in the increased cost of imported raw materials, which has a significant impact on electronic equipment manufacturing industries such as computers and telecommunication," Zhao added.

The Caixin/Markit Manufacturing PMI, which mainly monitors the market performance of small and medium-sized enterprises, was at 50.9 in November. Although the index stayed in the expansionary range, it declined from 51.2 in October, which shows a slowing expansion pace in the manufacturing sector.

"Caixin/Markit Index readings for both output and new orders declined, but those tracking input and output prices rose at a faster pace to hit their highest levels in five years, pointing to further intensification of inflationary pressure", said Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group, a subsidiary of Caixin Insight Group.

"The November PMI indicates that China's domestic economic operation is stable and the positive effect of supply side structural reform is gradually appearing," said Zhang Yiping, an economist with China Merchants Securities. "The quality of China's economic growth is gradually improving."

Most Chinese companies are confident about their revenue growth in the next three years, and nearly 70 percent of the interviewed companies are interested in mergers and acquisitions (M&As), according to a study report issued Monday on China's capital market.

The study, named China Capital Market Insight Survey 2016 and jointly developed by PricewaterhouseCoopers, BNY Mellon, ICR Inc. and Skadden, surveyed Chinese executives between July and September, receiving responses from 108 Chinese companies.

A majority of the executives are confident about their company's revenue growth in the next three years, the study showed. The executives were asked to rate their confidence in growth with figures from 0 to 10. Almost a quarter rated themselves 10, the highest confidence level, while three quarters were six or above in confidence.

The study also showed that Chinese companies have a strong appetite for M&As over the next 24 months. Among the public companies surveyed, 40.6 percent are interested in domestic M&As, while 28.1 percent are eyeing overseas deals. Meanwhile, private companies are also eager for M&As.

Chinese companies are accelerating raising capital in the global market, according to the study. While 43.8 percent of the public companies surveyed are planning to issue debt in the next 24 months, private companies rely more on equity investment, with 48.7 of them aiming to raise equity in the next 24 months.

China's housing market is expected to be stable next year although regulatory risks remain high amid rapidly rising home and land prices, international ratings firm Moody's said in its latest forecast.

"We expect the growth in nationwide contracted sales by value to be flat or slightly negative in 2017, against a high base of contracted sales for 2016," said Kaven Tsang, vice president and senior credit officer at Moody's. "We estimate sales growth of around 25 percent year on year for 2016."

Tsang predicted that sales volume to fall by 5-10 percent next year as major cities in September and October imposed tightening measures, turning the sector outlook to negative. But the drop will be partly offset by a modest rise in prices.

If sales volume rises by above 10 percent annually on a sustained basis and in a low regulatory risk environment, the outlook could shift to positive, Moody's said.

A sharp price decline seems unlikely in the next six to 12 months, given the relatively low inventory levels in high-tier cities, Moody's said.

Developers' gross margin will stabilize next year due to reduced destocking pressure and improved selling prices, amid the strong contracted sales registered in the past 12 to 18 months, said Moody's, which rated 50 developers in China.

Late on Monday, Shanghai announced down payment for first-time home buyers would be raised to 35 percent from 30 percent from yesterday. People who now don't own a house but have applied for mortgages from either commercial banks or public housing funds anywhere in the country will have to pay a minimum 50 percent down payment as they are considered second-home buyers in the city from now on.

China’s top grossing firms made 55 per cent more money in 2015 than two years previously, exclusive research by The Lawyer has revealed.

The Lawyer’s third edition of the China Top 30 report – an annual ranking and analysis of China’s leading law firms – found the combined revenue jumped from RMB12.95bn (£1.5bn) in 2013 to RMB20.16bn (£2.3bn) in 2015.

Revenue growth was largely fuelled by recruitment efforts including national expansion through regional bolt-ons.

The total number of lawyers in the top 30 firms increased by around 36 per cent in the same period, to 23,023.

In the two year time period many of the firms opened offices overseas or joined forces with established international firms.

Dentons (formerly Dacheng), King & Wood Mallesons (KWM) and Zhong Lun once again claimed the top three spots in the league table by total revenue, following double-digit revenue hikes.

Dentons, the biggest Chinese firm by revenue, saw its 2015 revenue grow by 29 per cent to RMB2.9bn from RMB2.25bn in 2014. KWM’s revenue increased at a slightly faster rate of 30 per cent to RMB2.1bn. Zhong Lun, the smallest of the top three, recorded the fastest growth, up 34.4 per cent to RMB1.98bn.

Below the top three, there were notable movements in this year’s top 30 firms by revenue list, including several new entries and exits. Shandong-based Jointide and Beijing-based JunZeJun dropped out of the table, while Shanghai’s Llinks and Shenzhen’s Guanghe made their first appearance.

Llinks posted a turnover of RMB236m after achieving a 50 per cent revenue? hike and claimed the 27th place as a result. Guanghe, riding on the country’s booming new over-the-counter equity exchange (new third board), which provides a speedy and favourable way of fundraising for start-ups, ranked 28th. It recorded a 69 per cent increase in revenue, from RMB136m to RMB230m.

The firms in the top 10 group remained largely unchanged on the previous year. However, AllBright, with a 48 per cent increase in revenue, moved up three places to fourth spot. Beijing-headquartered Jingtian & Gongcheng, with a 41.6 per cent revenue growth, made its debut in the top 10, replacing last year’s tenth high-grossing firm, JT&N.

Among the rest of the top 30 firms private equity and technology-focused Han Kun rose most rapidly, by six places to 17th. National giant W&H also moved up six places, to 19th. Beijing-based Tian Yuan was up five places to 11th, overtaking larger rivals such as Kangda, JT&N and Zhonglun W&D.

Some firms’ managing partners expressed concerns regarding continued growth prospects over the combing years, mainly due to China’s slower economic growth and greater uncertainty in some of the world’s largest economies.

However, many of the best performing firms expected to achieve a similar, if not faster, rate of revenue increase in the current financial year.

Top 30 by revenue (2015)
Rank 2015 Rank 2014 Rank Change Film
1 1 Equal Dentons (China)
2 2 Equal King & Wood Mallesons (China)
3 3 Equal Zhong Lun
4 7 increase AllBright
5 5 Equal Grandall
6 6 Equal Yingke
7 4 decrease JunHe
8 8 Equal Deheng
9 9 Equal Fangda Partners
10 13 increase Jingtian & Gongcheng
11 16 increase Tian Yuan
12 11 decrease Kangda
13 10 decrease JT & N
14 12 decrease Zhonglun W&D
15 17 increase Zhejiang T&C
16 14 decrease Zhong Yin
17 23 increase Han Kun
18 15 decrease Global Law Offices
19 25 increase W&H
20 18 decrease Longan
21 21 Equal Grandway
22 22 Equal Tahota
23 19 decrease Commerce & Finance
24 29 increase Haiwen & Partners
24 26 increase Beijing DHH
24 24 Equal Guantao
27 #### #N/A Llinks
28 #### #N/A Guanghe
29 27 decrease Co-Effort
30 30 Equal Hylands
Top 20 fastest growing firms by revenue (2015 vs 2013)
Rank Firm Two-Year Revenue Growth
1 Han Kun 185.7%
2 Guangdong Huashang 125.7%
3 Tian Yuan 117.8%
4 Beijing DHH 109.5%
5 Grandall 106.3%
6 Guanghe 98.3%
7 Zhong Lun 91.8%
8 Tiantong & Partners 90.0%
9 Zhejiang T&C 84.4%
10 Yingke 81.4%
11 Kangda 80.5%
12 Hylands 79.1%
13 Jingtian & Gongcheng 77.1%
14 AllBright 75.9%
15 Zhong Yin 72.6%
16 Dentons (China) 62.9%
17 Tahota 62.8%
18 JT & N 61.4%
19 Lifang 60.0%
20 Fangda Partners 58.3%
The Lawyer’s China Top 30 2016 report, released on 26 September 2016, identifies the top performing Chinese firms by various key metrics such as revenue, RPL, revenue growth and RPL growth last year.

The third annual edition of the report also contains three years of financial and technological data and indepth analysis on Chinese law firms’ strategies from some of the country’s most eminent lawyers.

The Black Friday shopping season is expected to spur Chinese online purchases overseas despite the recent weakening of the yuan.

Ymatou.com, a Shanghai-based e-commerce company dedicated to overseas products, has already rolled out special offers days before the shopping season and has seen rising sales compared with last year.

The company said it sold 60 million yuan ($8.67 million) worth of goods in the first 10 minutes when the sales started last Friday, a week earlier than the official start of the shopping season.

An 88,999-yuan Birkin bag was snatched up within two minutes and 320 Canada Goose jackets priced over 5,000 yuan were sold out in an hour.

The yuan further weakened on Thursday to pass the threshold of 6.9 against the U.S. dollar.

"The depreciation of the yuan does not dampen the frenzy of shopping abroad as most Western products on sale are still quite cheap compared with same products sold in franchised stores in China," Zeng Bibo, chief executive officer of ymatou.com, said on Thursday.

Chinese middle class shoppers are becoming increasingly sophisticated. "They want to buy high-quality products, enjoy good services and live a tasteful life," said Zeng.

The Black Friday shopping season seems a good opportunity for them to live such lives at a relatively low cost. The shopping festival is a period when retailers offer massive discounts to attract consumers.

Chen Tao, an analyst with Beijing-based internet consultancy Analysys, said Black Friday has been growing in popularity in China.

"But it is still in its infancy in China, and its size is quite small compared with China's homegrown online shopping festival Singles Day," he said.

"As Chinese middle class shoppers are becoming less and less price sensitive, what they care most about in cross-border shopping is the quality and brands of goods, fast delivery and good return policy, which will be the key areas for online retailers to work on," he added.

Weibo, which is often called China's homegrown version of Twitter, is no longer satisfied with just tweeting.

As part of Chinese internet company Sina Corp, Weibo Corp is positioning itself as a combination of Twitter, Instagram and YouTube in order to gear up its development as a "social media platform", said the company's top executive.

Charles Chao, chief executive officer of Sina and chairman of Weibo, said that "apart from being a real-time information network, Weibo is also equipped with the features of social networking systems".

Chao said the major reason for Weibo's rapid growth in the past year was the string of adjustments it made in the process of repositioning its strategy. "The next move is to focus on connecting people and content. We will build a vigorous ecosystem that can attract more people from various backgrounds," he said to China Daily at the sidelines of the third World Internet Conference, which ended on Friday in Wuzhen, Zhejiang province.

Launched in China about seven years ago, Weibo for a time was the leader in China's cyberspace until its thunder was stolen by WeChat, an instant messaging app launched by Tencent Holdings Ltd in 2011.

But, Weibo's changing strategy has pushed it to the top once again thanks to its effort to attract young people and users in smaller cities. It allows them to demonstrate fully who they are via text-based tweets, self-generated videos and even live-streaming.

Statistics from data research firm QuestMobile show that Weibo had 390 million monthly active users in September, ranking fourth of all apps in China. Its growth rate was 79 percent year-on-year, the most rapid of the top 10 apps listed by the research firm.

Chao said that Weibo is more open compared with WeChat because its social networking features are not constrained to close friends. "It gives each account -- individuals, superstars, web celebrities and institutes --opportunities to demonstrate their views and their capabilities, to set up a business and to spread information and content to a much broader audience," he said.

"That is the magic of Weibo. It is a wonderland that can make a nobody into a somebody, as long as they have talent," he added.

Chao discussed the rise of the web celebrity economy on Weibo as an example. By interacting with followers on Weibo, a former magazine model known as Zhang Dayi has become an online sensation. Zhang's fame in the virtual world helped her set a record of selling 20 million yuan ($2.9 million) worth of clothes online within two hours.

"We will keep making efforts to empower our users," he said. In the online celebrity sector alone, Weibo is working with more than 300 multichannel networks to help online celebrities gain fans, boost influence and speed up monetization.

Chao said it invested in companies that can bring synergy with Weibo. For example, the company, which debuted on the Nasdaq in April 2014, has already invested in Yixia, a startup with strong technology in video and live streaming.