Best investor event: How PetroChina Co and Yue Yuen Industrial won in Greater China
This profile is taken from the report Award-Winning IR – Asia 2018. Click to download your copy now.
Two companies share the award for best investor event in the large-cap category this year: PetroChina, the listed arm of state-owned China National Petroleum Corporation, and Yue Yuen Industrial, the Hong Kong- headquartered, Taiwanese footwear manufacturer, which is owned by Pou Chen Group, the largest branded athletic and casual footwear manufacturer in the world.
For PetroChina, it was the firm’s corporate day and reverse roadshow that secured the win. With oil prices rising steadily ‘and domestic demand for natural gas also increasing significantly, PetroChina has once again become the focus of the market,’ it says in its awards entry. This, coupled with the fact that ‘foreign investors are paying more attention to disclosure on ESG criteria’, told PetroChina it was time for a corporate day and reverse roadshow – though the Beijing-headquartered oil and gas giant stresses that it regularly holds a wide range of investor events. In fact, it says recent years have seen it hold more than 30 reverse roadshows with more than 400 participants – all well received by the market. As was this event.
‘The 2018 corporate day and reverse roadshow event was a huge success,’ says PetroChina, with ‘a lot’ of positive feedback. And the numbers speak for themselves: ‘A total of 112 investors, analysts and shareholders from 81 investment institutions joined the event, with Nomura, Morgan Stanley and Bank of America Merrill Lynch raising the target price of the company, and Morgan Stanley recommending PetroChina as a top pick after the event,’ it notes.
For Yue Yuen Industrial, it was the company’s first ever site visit to a new automated facility, held in May 2018, that won it an IR Magazine Award. Despite making the decision for ‘ethical reasons’ not to sponsor or subsidize travel – which for analysts coming from Hong Kong, for example, included seven hours of plane and road travel to the firm’s new automated footwear manufacturing facilities in Vietnam – the two-day event attracted 14 buy-side and sell-side analysts, all of whom had been invited directly by Yue Yuen’s in-house IR team. The two days were split between the sell side, the buy side and existing shareholders ‘in order to meet the differing needs of these investors.’
The impact of taking analysts to visit the automated site – in an industry that Yue Yuen says ‘remains labor-intensive’ – and offering face time with Yue Yuen’s CFO and the management of different manufacturing business units was very positive, says the company. It received strong buy-in from sell-side analysts, with a number of ‘positive and accurate research reports [published] shortly after the visit’ exposing Yue Yuen ‘to a huge base of institutional investors in an efficient and cost-effective manner.’
The company even says the site visit may have been a factor in the stabilization of its share price in the second quarter of 2018, ‘which had suffered as a result of long-term concerns about margins and ordering trends.’
Finally, Yue Yuen says the lasting effect of the event – rare among the ‘secretive’ original equipment manufacturers – is a boost to credibility, as it demonstrated the firm’s sincerity about improving transparency and meeting the information needs of investors. ‘This set Yue Yuen apart from its competitors in the eyes of the investment community,’ says the company.