2016.09.08 PEdaily 浏览次数:
With CEO Zhang Wei’s unremitting efforts over the past 15 years, CoStone Capital has grown from nothing to the scale it has today, with more than 40 funds under management, a total worth of over 30 billion yuan. In the industry, CoStone Capital is known for “would rather make a focused investment than a micro one” Among over 90 enterprises that were invested by CoStone during the past 15 years, only one of them had a loss of principal.
Zhang Wei, Chairman of CoStone Capital
With CEO Zhang Wei’s unremitting efforts over the past 15 years, CoStone Capital has grown from nothing to the scale it has today, with more than 40 funds under management, a total worth of over 30 billion yuan. In the industry, CoStone Capital is known for “would rather make a focused investment than a micro one” Among over 90 enterprises that were invested by CoStone during the past 15 years, only one of them had a loss of principal.
Despite having many successful portfolios, Zhang Wei does not afraid of mentioning the only serious failure in his 15-year investment career – Xuchang Hengyuan Hair Products Co., Ltd. (hereinafter referred to as Hengyuan).
Hengyuan was an export-oriented fashion hair products company, located in the city of Xuchang in Henan Province, which is the largest hair products manufacturing base in China. In Xuchang, there were nearly a hundred companies of this kind, but only Hengyuan could keep abreast with Henan Rebecca Hair Products (600439.SH), the local industry leader in terms of operation revenue and taxation. Hengyuan tried to go public twice but failed, which in return imposed a negative influence on the company’s development. Due to series of problems triggered by overexpansion and moral problems of the actual controller, Hengyuan had been trapped in operational risks and debt crisis since the second half of 2014, then suffered huge losses in 2015. “It lost billions of yuan in a year on paper and now is undergoing bankruptcy restructuring.”
Zhang Wei made a conclusion on this failure: “At that time, it was too easy for Hengyuan to raise capital. Even when its first IPO application was rejected by China Securities Regulatory Commission, the company was still favored by many institutional investors and got too much money from PE. That led to blind expansion and Hengyuan failed to handle it well. It was a typical example that the maldigestion of significant capital inflow, rather than lack of money, will ruin a company. And this is true for many other enterprises.
In addition to the case mentioned above where Zhang Wei lost the principal, he also classified some portfolios where he only got the principal back, such as the Eagle Brand Group portfolio, as his failures.
Eagle Brand Group was situated in the town of Shiwan, Foshan City, Guangdong Province. Used to be the No. 1 in China’s ceramic industry, this company boasted an annual sales volume of over 1.1 billion RMB (the profit of which exceeded 200 million RMB) in 1998 and went public in Singapore in February 1999. In 2005 when Singapore’s capital market was sluggish, Eagle Brand Group’s valuation was merely 70% of its net asset, whereas the company had no debt but cash. From various perspectives, it was underestimated. Therefore, CoStone Capital acquired Eagle Brand Group through buyout investment.
It seemed like a perfect investment: healthy in corporate finance, the company could either exit through M&A by industry magnates (such as Marco Polo) or could return to be listed in China to achieve cross-market arbitrage. However, "the dream is ideal while the reality is cruel." Zhang Wei recalled: "After we had a holding, the complexity in actual operation is beyond our judgment. Even two years later, Eagle Brand Group still encountered difficulties in governance and management and failed the restructuring. As we were unable to continue to run the company, we sold its book assets and got the principal back, only making a meager profit of two percent per year. In the end, we even sold the company's shell."
From those failed cases, Zhang Wei and CoStone Capital realize the complexity in corporate governance and the significance of an outstanding management team. An excellent management team should have the capability to create value, which is crucial to a company and becomes the basic value of CoStone Capital.
CoStone Capital regards growth and valuation as core factors in every stage of the investment. Growth can serve as a parameter of valuation (no absolute standards). Different valuation systems and ways to cash out can impose a profound impact on investment decisions. “If an independent IPO can give us 10 times in return, then a stock-for-stock merge gives 3 times, and acquisition by major shareholders provides an only 1-time return.”
Zhang Wei has, on many public occasions, stated that: We do not invest in the macroeconomy nor a certain industry, but a specific company. A company that has its industrial competition pattern, corporate governance, and entrepreneurship. It is not just about the cold macro-economic data.
“In the future, CoStone Capital will continue to develop diversified products based on equity investment. We will grow into a medium-sized asset management company with multiple portfolios to serve investors.” As for himself, Zhang Wei would like to learn from those Silcom heroes to devote himself to social welfare in the latter half of his life.
This is part of the interview with Zhang Wei on the “2017 PEdaily’s List of Top 100 Investors in China”. For the full transcript of the original Chinese interview, please refer to https://pe.pedaily.cn/201801/425728_all.shtml
过去一年，牛市重启，科技领航。
正如我在2024年10月所说的那样，“924”的行情并不是一个反弹，而是一个反转，自那以后，中国资本市场经历了一个从低估到价值回归的过程。
当上证指数来到10年最高点，“易中天”一年翻几倍，“寒王”市值一度突破6000亿，其他科技股也动辄百倍PE、百亿估值，有人贪婪，有人恐惧，还有人问我：科技股存在估值泡沫吗？
我说，这是一个时代的饥渴与焦虑，在资本市场中的投射。如果你理解这一点，你就不会对当前科技投资的热潮感到困惑。
投资与宏观经济无关，但确与地缘政治有关。
中美关系决定了未来几十年的投资，地缘政治极大构建了我们这个时代的饥渴与焦虑，深刻重塑了我们的投资行为。
中国的饥渴与焦虑是什么？第四次工业革命的大幕已然开启，第三次工业革命的短板却还未补齐，时不我待！
所以当有人疑惑，为什么国产算力芯片企业，技术难以望英伟达之项背，却有这么高的估值？为什么英伟达的PE只有50倍，“中国版英伟达”却有300倍？
我说，逻辑刚好反了，正是因为短期内追不上英伟达，这些企业才被赋予了更高的战略性定价，而且差距越大，战略价值越高。越得不到越饥渴，越追不上越焦虑，如果有一天，我们的算力芯片完全突破了，估值反倒会下来。
中国最美的自然风景在哪里？我认为很大一部分分布在横断山脉及其周边，梅里雪山、玉龙雪山、贡嘎山、四姑娘山、九寨沟等等都在这里。巨大的落差，结构性断裂，形成了壮丽的风景。
硬科技投资就是这样，技术代差、能力断点、体系缺口——难度的跃迁，带来了估值的跃迁，成功之后也将带来回报的跃迁。
这一逻辑，除了算力芯片领域，在存储芯片、商业航天等中国与外国差距比较大的领域，也都有所体现。
正因如此，从2016年开始，基石资本就果断将投资重点聚焦到硬科技、新兴产业和生命科学与健康三个领域——在这个语境下，“硬科技”特指那些与美国有代差的重要产业。
得益于这样的前瞻性，基石资本很早就在半导体、人工智能和机器人等关键领域实现了全产业链布局。
展望未来，科技进步与产业升级是无尽的前沿，硬科技产业差距的缩小亦无法一蹴而就，技术创新和国产替代的双重机会之窗才刚刚打开，任重道远，未来可期。
作为投资机构，基石资本将继续投身于每个时代的饥渴与焦虑，顺着时代的张力前行，向最难、也最重要的方向延伸。