CHINA’S RICH ARE GETTING POORER IN NEW HURUN RICH LIST

NO. OF BILLIONAIRES DOWN AFTER 6 YEARS OF GROWTH

LEADING AUTHORITY ON CHINA’S WEALTHY RELEASES CHINA RICH LIST 2012

• 67-year old Zong Qinghou is richest man in China for second time in three years with personal fortune of US$12.6bn.
• Of the Top 1000 of the Hurun Rich List, 469 saw their wealth shrink, of which 37 shrunk by over 50%, mainly those from solar, textiles and retail sectors.  291 saw their wealth grow, 114 stayed the same and there were 150 new faces.
• Cut-off to make list down 9% to US$290 million, but still triple the cut-off of five years ago.
• The number of dollar billionaires is down 20 to 251 individuals this year, but still considerably up from six years ago when there were only 15.
• Yang Lan (198^th, US$1.1bn)and Pan Shiyi (32^nd, US$3bn) are China’s most popular microbloggers from the Hurun Rich List 2012 with over ten million followers each.
• Property loses top spot as source of wealth for first time since records began in 1999, when half the Rich List had property as their main source of wealth. Manufacturing takes over with 20.7% of the individuals on the Rich List. Individuals counting investments as one of their main industries have seen the sharpest rise to 8.6% of the list.
• Wu Yajun (8^th)is China’s richest woman and richest self-made woman in the world for the second year running with a personal fortune of US$6bn.
• Vehicle maker and 18^th Party Congress delegate Wei Jianjun (39^th) was the fastest riser this past year, seeing his wealth shoot up from US$1bn to US$2.8bn on the back of a domestic listing of vehicle-maker Great Wall Motors.
• The Rich List has engaged in record size deals this past year.  Jack Ma (55^th, US$2.4bn)led a US$7.1bn buy back of 20% of Alibaba’s shares from Yahoo; Wang Jianlin bought US cinema chain for US$2.6bn; lastyear’s Number One Liang Wengenbought 90% of Putzmeister, a German machinery manufacturer for US$400 million; Mi Enhua of Hualing bought 90% of Basis Bank in Tbilisi, Georgia for US$100 million and is planning on investing a further US$450 million into the country; Yan Bin of Reignwood started development of a US$200 million luxury residential and private club in London.
• 7 individuals on the Hurun Rich List 2012 are delegates to the 18^th Party Congress, including Liang Wengen. 150 individuals were delegates to either the NPC or CCPCC, including 4 members of the NPC standing committee.
• There were more individuals born in the year of the Rabbit than Pig and Ox combined.  Rabbits dominated with 12.8% of the Hurun Rich List 2012.
• Hainan Clearwater Bay of Agile title sponsor of the Hurun Rich List 2012 for the 4^th successive year

(24 September 2012, Shanghai) The Hurun Research Institute today released the Hurun Rich List 2012, an annual ranking of the 1000 richest individuals in China. The Hurun Rich List 2012 is sponsored by Hainan Clearwater Bay of Agile. Wealth calculations are a snapshot of 15 August 2012. This is the fourteenth year of the China Rich List, since Hurun Report founded it in 1999 and the fifth year it has covered 1000 individuals.

In a year when the Shanghai Stock Exchange fell 23%, 469 of the Hurun Top 1000 saw their wealth shrink, 291 saw their wealth grow, 114 stayed the same and there were 150 new faces and .37 individuals saw their wealth shrink by over 50%.

There were 251 dollar billionaires in China ranked this year, down 20 on last year, but still hugely up on as little as six years ago when there were only 15 billionaires.

The average wealth of the Hurun Top 1000 is down 9% to US$860 million, but still almost double that of 2008 when it was US$439 million.

Solar, textiles and retail have been the hardest hit this year. Entertainment, IT, natural gas and property developers sitting on large landbanks, have had a good year.

Rupert Hoogewerf, Hurun Report Chairman and Chief Researcher said, “Although this year has seen some significant wealth bloodletting, it is worth remembering that these entrepreneurs are still up 40% on two years ago and almost ten times ten years ago.”

Hurun Rich List2012 - The Top 10

Source: Hurun Rich List 2012 sponsored by Hainan Clearwater Bay of Agile

↑ Rank increase yoy  ↓ Rank decrease yoy  - No Rank change yoy  * New to Top 10

The Top 10

‘Drinks King’ Zong Qinghou, 67, of the Wahaha Group has regained the top berth he held in 2010 and becomes only the third person in 14 years to retain the crown. Zong tops the Hurun Rich List 2012 with a personal fortune of US$12.6 billion, based on his 80% holding of soft drinks brand Wahaha, which last year reported net profits of over US$1bn.

58-year-old Wang Jianlin’s wealth jumped 44% to US$10.3 billion, bouncing Wang into second place. Earlier this year, Wang shook up the entertainment industry with the announcement of a US$2.6bn acquisition of US cinema chain AMC Entertainment, the largest international acquisition by someone from the Hurun Rich List to date. Wanda’s core business remains its property arm, particularly its shopping malls, which continue to spring up all over the country and last year turned over US$16bn.

Robin Li Yanhong,44, is in third place again with a net worth of US$8 billion, based on his 16% of Baidu. Google’s withdrawal from the Chinese market two years ago has allowed Baidu to cement its position as the number one choice for Chinese-language internet search services. Baidu has a market cap of over US$50bn.

Yan Bin, 57, of Reignwood, is fourth again with US$7.9 billion, and is the second member of the drinks industry to make the Top Five. Yan holds the Chinese rights for the Red Bull energy drink and has this year invested into a US$200 million property in London, which he is planning to turn into a hub for Chinese business people in Europe.

Last year’s Number One, Liang Wen'gen saw his share price drop, resulting in a fall to fifth place. Liang is one of only seven individuals on the Hurun Rich List that has been appointed as a delegate to the 18^th Party Congress, the once in a decade leadership change. The Sany Group, in which Liang owns 58%, has contributed seven individuals to this year’s Top 1000, more than any other single company. This past year, Liang purchased a German machinery builder for US$400 million, in the largest Sino-German acquisition to date.

Liu Yongxing, the richest man in 2001, jumped two places to sixth this year with a total wealth of US$7.1 billion.

Pony Ma Huatengcomes in at seventh with a personal wealth of US$6.5bn. Tencent Holdings is the largest company by market share of anyone on this year’s Hurun Rich List, with a market cap of US$65bn.

Wu Yajun, 47, keeps the title of richest woman in China and the richest self-made woman in the world for the second year running. The property tycoon has built Longfor into one of China’s premier developers, placing her at 8^th place with US$6 billion.

Xu Jiayinstays in the top ten this year but falls 4 places to 9^th after suffering a dramatic drop in his share price. Xu has been spending heavily on his soccer team, which won the Chinese Super League this past season.

71-year-oldChen Lihua is the second self-made woman to make the top ten of the Hurun Rich List 2012. Chen’s US$5.4bn fortune derives from her prime commercial property in the heart of Beijing.

The average age of the Top Ten is 56 years, four years older than the average of the Top 1000.

Last Year’s Missing Top 10

He Xiangjian, 70, saw his fortune halve from US$6.3bn to US$3.3bn this year, pushing him down from ninth place to 25th. Midea Group’s share price was hit hard this past year, cumulating in He resigning as chairman in August this year.

Yang Huiyan, 31, saw the value of property developer Country Garden drop slightly, to ease her into 11^th place with a personal fortune of US$5.2bn.

Political Appointments

Seven individuals on the Hurun Rich List are delegates to the 18^th Party Congress, including Liang Wengen (5^th, US$7.3bn), Zhou Haijiang (151^st, US$1.3bn), Wei Jianjun (39^th, US$2.8bn), Li Denghai (442^nd, US$620m), Chen Xueli (764^th, US$360m), the sister ofFeng Hailang (131^st, US$1.4bn) Feng Yali andZhang Yubo (207^th, US$1bn).

There are 76 (up from 74 last year) delegates to the NPC and 74 (up two from last year) delegates to the CCPCC. There are four member of the standing committee of the National People’s Congress on the Hurun Rich List 2012, namely Wang Jianlin (2^nd, US$10.3bn), Lu Zhiqiang (10^th, US$4.7bn), Wang Yusuo (40^th, US$2.8bn) and Liu Hanyuan (64^th, US$2.1bn).

The higher up the list, the more likely they are to have a senior political appointment.  6 of the Top 10, and 39% of the Top 50 are either delegates to the 18^th Party Congress, the NPC or CPPCC.

Beijing is Home to 123 of theHurun Rich List

Beijing is the city with the most Hurun Rich Listers with 123 making the capital their homebase, up 12 on last year. Shanghai snatched back second place from Shenzhen as the second most popular city with 80 individuals.

By province, Guangdong continues to lead the way with 174 individuals, followed by Zhejiang on 141.  Interestingly, Inner Mongolia, famous for its coal miners, has overtaken HK for the first time, with 29 individuals based there compared with only 23 for Hong Kong. This year, for the first time, we had entrepreneurs from every region in China, including the first one based in Qinghai and four based in Tibet.

By birthplace, Zhejiang is head and shoulders above those born in Guangdong and Jiangsu.  157 individuals were born in Zhejiang, compared with 114 and 96 for Guangdong and Jiangsu respectively.

Property Usurped for First Time.

For the first time since the Hurun Rich List began in 1999, property has dropped into second place as the key source of wealth, behind manufacturing.

Individuals counting investments or media/entertainment as their main industries have been sharply on the rise, whilst individuals counting property, natural resources (especially mining), retail and new energy have declined in numbers.

Source: The Hurun Research Institute 2012

Individuals on the Hurun Rich List with the Largest Social Media Followings

Yang Lan (198^th, US$1.1bn)is the Queen of the Social Media, with more than 10 million fans on both of Sina and Tencent, China’s two largest microblog platforms. Others of note include property tycoon Pan Shiyi (32^nd, US$3bn), film star Jet Li (982^nd, US$300 million), gamer and investor Shi Yuzhu (36^th, US$2.8bn) as well as education provider Yu Minhong (288^th, US$850 million).

Source: Sina and Tencent Weibo websites September 2012

Best of the Rest

469 individuals saw their wealth decline with 37 of them seeing it halve or more, many of them in solar.  Wu Jianlong (789^th, US$350 million) saw his wealth decline 69%, solar tycoonZhu Gongshan (168^th, US$1.2bn) and Ni Kailu and daughter Ni Na (829^th, US$300 million)were both down 59%. Another solar tycoon,Shi Zhengrong (571^st, US$470 million) saw the share price of Suntech collapse by 90% and today just makes the cut with US$450 million. Peng Xiaofeng of LDK Solar in 2007 was sixth on the list with US$6bn, but this year did not even make the cut as his stock plummeted by over 95%. 

Going International.The Rich List has engaged in record size deals this past year.  Wang Jianlinbought a US cinema chain for US$2.6bn; Last year’s Liang Wengenbought 90% of Putzmeister, a German machinery manufacturer for US$400 million; Mi Enhua of Hualing bought 90% of Basis Bank in Tbilisi, Georgia for US$100 million and is planning on investing a further US$450 million into the country; Yan Bin of Reignwood has begun development of a US$150 million luxury residential and private club in London.

Deals not yet done.  Jiang Zhaobo of Pengxin is still in process of trying to win approval from the New Zealand government to purchase a diary business for US$120m.  Huang Nubo of Zhongkun is still in the process of trying to win approval from the Icelandic government to purchase close to 300 square kilometers of Iceland for US$200 million.

Textiles have had a dreadful year.  Qiu Guanghe (58th, US$2.2bn) of Senmir, Li Ning (574th, US$0.47bn) and Zhou Chengjian (27th, US$3.7bn) of Metersbonwe have seen their wealth plummet by 59%, 45% and 36% respectively.

Others that dropped off the list include Li Guoqing of Dang Dang, agricultural magnate Guo Hao and Peak Sport’s Xu Jingnan.

Winners. 18th Party Congress delegate Wei Jianjun (39^th, US$2.8bn) was the fastest riser this past year, with his wealth shooting up from US$1bn to US$2.8bn on the back of a domestic listing of vehicle-maker Great Wall Motors. This past year, Wei became the first Chinese car maker to start producing cars in the EU, with a plant in Bulgaria.

Jack Ma (55^th, US$2.4bn) of Alibaba Group saw his wealth rise to US$2.4bn after successfully leading a buyback of 20% of Alibaba Group’s shares from Yahoo for US$7.1bn. Jack Ma also courted controversy earlier in the year when he personally took control of Alipay, an online payment business, from the Alibaba Group.

Of the 150 new faces,60 came from newly listed companies, led by Wang Wenxue (119th, US$1.6bn) of Fortune Land Development, Li Yinhui (165th, US$1.2bn) of Qinghai Huzhu Barley Wine and Wang Junmin (260th, US$0.95bn) of Haisco Pharmaceutical.

Interesting new faces include China’s largest lingerie business and answer to Victoria’s Secrets, the female entrepreneur Zhang Rongming (968^th, US$320 million) of Aimer, who came in at US$320 million.  Others include the Noodle King Chen Keming (945^th, US$320 million).

Title sponsor of Hurun Rich List.Agile Property, controlled 63.6% by Chen Zhuolin & family (24^th, US$3.4bn), is title sponsor of theHurun Rich List for the fourth year running.

Some have been in disputes.  Zhang Changhong (359^th, US$710 million) of Great Wisdom is embattled in a law suit with Bloomberg. Du Shuanghua (33^rd, US$2.9bn) of Rizhao Steel is currently going through a high profile divorce case, which is expected to be the most expensive divorce in China to date.  Mining tycoon Zhou Furen (90^th, US$1.7bn) has made the papers recently after an investment in North Korea turned sour.  Education tycoon Yu Minhong (298^th, US$0.85bn) has seen his share price hit after allegations of improper control of New Oriental’s China operations. Zhang Jindong (21^st, US$3.7bn) Liu Qiangdong (870^th, US$320m) and Huang Guangyu (26^th, US$3.3bn) have been waging a price war for the future of the household electronics retailing sector.

Some have had brushes with the law.  After losing the battle to retain the rights to manufacture popular drink Wang Laoji, Chen Hongdao (164^th, US$1.3bn) has set up a new brand called Jiaduobao, and has recently been charged with bribery. Xu Ming (212^th, US$1.03bn) of Shide has disappeared since being implicated in the Bo Xilai case, but still makes the list at US$1bn. At the end of last year, Zhang Keqiang (298^th, US$840 million) of Poly Property Group was arrested on charge of bribery but still makes the list with US$840 million.

Some are in prison.  Huang Guangyu of GoMe, and Zhang Wenzhong of Wumart.

One person died.On 15 May, Wu Huitian of Malata died, and leaving his wealth to son Wu Kaiting (542^nd, US$500million).

Some have resigned.  This past year, He Xiangjian (25^th, US$3.3bn) of Midea, Zhu Yicai (43^rd, US$2.5bn) of Yurun and Shi Zhengrong (571^st, US$470 million) of Suntech have all resigned as chairman of the businesses they founded.

Some have delisted.  With stock market prices in the doldrums, it is a good time to think about delisting.  Chen Tianqiao (81^st, US$1.9bn), the youngest self-made dollar billionaire on the Hurun Rich List 2012, delisted the Shanda holding company after being on the Nasdaq, whilst Jack Ma (55^th, US$2.4bn) led the delisting of Alibaba from the HK stock exchange.

IT.  For IT, the big winner this year was Jiang Bin (30th, US$3.2bn) of GoerTek, a supplier of electronic components to Samsung, who has seen his share price surge.  Other winners were shareholders of Lenovo, including its CEO Yang Yuanqing (322nd, US$0.79bn) and investor Lu Zhiqiang (12th, US$4.7bn). The post Facebook IPO era has seen continued bloodletting in Renren’s share price, which fell over 50% this year, dropping Chen Yizhou’s (791st, US$350 million) wealth to US$350 million. 

Healthcare had some good performers, led by Liang Yunchao & family (1327th, US$1.4bn) of BY-Health, whose wealth doubled to US$1.4bn.  Another was Lin Baolin and family (68th, US$2.1bn) of Jointown, a pharmacy chain. The Lin family’s wealth surged 73% to US$2.1bn.  One pharma tycoon that had a second bad year was Li Li & family of Hepalink.  After going public in 2010, Li shot up from nowhere to second place with a personal fortune of US$6bn, but since then the share price has tanked by almost three quarters to take their wealth to US$2.2bn.

The industries with the youngest entrepreneurs are IT, entertainment and restaurants. Their average age is 48yrs, four years younger than the average of the whole list.

Chinese Star Signs

Rabbits continue to make the best entrepreneurs, dominating the Hurun Rich List almost every year since its inception.  This year rabbits outnumbered pigs and oxes combined, with 12.8% of the Hurun Rich List 2012.

Source: The Hurun Research Institute 2012

Number Ones Over the Years

Since 1999, ten individuals have taken the top spot.  This year’s number one Zong Qinghou is top for the second time. Rong Yiren and son Larry Rong together with Huang Guangyu have been Number One three times each.

Source: The Hurun Research Institute 2012

Methodology

The Hurun Rich Listis a snapshot of wealth on 15 August 2012. US$ figures are a conversion of the RMB figures as of 15 August 2012 and the exchange rate used for US$ was RMB 6.3.  The list relates to Mainland Chinese only, defined as someone born and brought up in Mainland China, no matter what passport they might hold today.

Valuing the wealth of China’s richest is as much an art as it is a science.  We have missed some people, but we believe the Hurun Rich List is the most serious attempt to identify China’s top entrepreneurs and to measure their holdings.  Our team of researchers has - for the fourteenth year running - traveled the length and breadth of the country cross-checking information with entrepreneurs, industry experts, journalists, bankers, and regulators, as well as previous years’ databases. For non-listed companies our valuation was based on a comparison with their listed equivalents using prevailing industry Price/Earning ratios.

Stats

Cut-offto make list in 2012 is down 9% at US$290 million, although still triple that of five years ago. The number of dollar billionaires may have been down slightly on last year with 260 individuals, but a far cry from six years ago when there were only 15.

Source: The Hurun Research Institute 2012

Cut-off

Source: The Hurun Research Institute 2012

Size of Market

China today has 2.7 million dollar millionaires, 1.02 million individuals with personal wealth of 10 million Yuan or more (GBP 980,000/ EUR 1.2 million/ USD 1.5 million), and 63,500 individuals with personal wealth of 100 million Yuan or more (GBP 9.8 million/ EUR 12 million/ USD 15 million), according to the Hurun Wealth Report 2012 released in August 2012.

For more info, refer to www.hurun.net

Hurun Rich List 2012 – Top 100, sponsored by Hainan Clearwater Bay of Agile

For the full list of the Top 1000, please refer to www.hurun.net

Source: The Hurun Rich List 2012, sponsored by Hainan Clearwater Bay of Agile

*For the rest of the Hurun Rich List, refer to www.hurun.net

About Hainan Clearwater Bay of Agile

Developed by Agile Property Holdings Limited, Hainan Clearwater Bay is a large-scale project based in the South of Hainan Island, close to Sanya.

Covering an area of 15,000 mu, with over 10 million square meters of development and a total investment of RMB20 billion, Hainan Clearwater Bay of Agile is listed as a key construction projects of the "12th Five-Year Plan” of the Hainan government.

Hainan Clearwater Bay is developed by Agile Property Holdings Limited, a listed company in Hong Kong in collaboration with Morgan Stanley, and is well placed to become a world-class new coastal holiday resort. The project boasts high-end supporting facilities including 6 international five-star resort hotels (including Jumeirah, Raffles, Intercontinental, JW Marriott, Hilton Resorts and Outrigger) and 2 world-class marinas to be built along the 16-kilometer landscape avenue and 12-kilometer coastline. It will take the lead in implementing Hainan’s international tourism island development strategy and becoming a new image of the international tourism island by leveraging the scarcity of global natural resources, forward-looking integrated development planning, and world-class award-winning supporting high-end facilities.

At present, after approximately 5 years of development and construction, this holiday resort is maturing. A group of six development including Golfer’s Paradise (金色果岭), Côte d'Azur (蔚蓝海岸), Silver Sand (瀚海银滩), The Galaxy (星海传说), Azure Oasis (蔚蓝高尔夫) and River Park (碧海帆影) are completed. Among them, Golfer’s Paradise, Côte d'Azur and The Galaxy have been put into service. The lakeside Commercial Street of the Côte d'Azur has started to business in October 2009, can meet the requirements of property owners. The large comprehensive farmers market built by the domestic renowned commercial management company will be open in the first half of this year…

The slogan “It is Your Second Life” has struck a chord amongst China’s wealthy elite, attracting 8,000 of them to become owners. The ultimate dream for coastal living.