1/10/17

Got a job offer to work in a securities company (prob 2nd or 3rd tier) in a major city (think Beijing/Shanghai) in mainland China. Does anybody know anything about sell-side equity research in China? Are the local firms more respected or are BB's more respected?

Comments (3)

1/10/17

Hi -- American here who recently lived in Shanghai for year and a half. My company took its China arm public in HK and in addition to working the IPO, I ran IR for the newly listed company and worked very closely with BB and local banks in China. We're covered by 20+ analysts so I saw a broad spectrum of analysts.

First off, just so you are aware, for intl BB banks to have a presence in mainland China they typically have to partner with a local firm. Ie GS operates under a Gao Hua Securities JV.

We were HK listed (H-shares), so our coverage and investor based was a bit more international and with that intl exposure, our BB coverage had more weight and generally had more access to mgmt. That said, much of our local coverage had developed niche's within the mainland market and that was quite valuable too us as well; especially with some of the larger, local hedge funds. That said, the A-share market (mainland) is very retail driven and I imagine that can be frustrating from a local research standpoint. The BB deal a lot less with the retail guys. Also, there is no shorting on the a-share market and valuations as a result of the big retail presence and lack of shorting can be astronomical, which can make providing research/recommendations on companies difficult, given the price a lot of these companies trade at, especially those on the Shenzhen exchange.

Without knowing your background (do you speak mandarin, are you planning on moving back to the US/Europe), I would prefer to be at a BB whose coverage entails a blend of H share and A share companies. You'll also have more exit opps if you move back from China.

Kind of rambling so I apologize, but hope this adds some color.

Financial Modeling

1/10/17

MKM, thanks so much for the reply. To give you a little bit of background, I am a Chinese citizen, and received my education in the US. I plan to go to a top MBA program in the US in a few years.

I have to agree with you that BBs are more international but I am having a hard time getting interviews although I had sell-side ER experience in the US. Any advice on where/how I can network with Americans working in Shanghai/Beijing?

1/11/17
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