‘Cash is king’: Hong Kong, mainland Chinese firms hoard reserves as growth options narrow
Cash holdings rise among traditional firms listed in Hong Kong and Shanghai as productive places to deploy capital dwindle, analysts say
Cash holdings among Hong Kong- and Shanghai-listed companies most representative of traditional industries – with core operations rooted in physical, tangible businesses – have risen from previous reporting periods. This stands in contrast to technology firms, which have been pouring money into artificial intelligence infrastructure build-up.
Per-share cash and equivalents at the 50 companies on the Shanghai Stock Exchange dividend index climbed 7 per cent year on year to 3,611.31 yuan (US$531) by the end of 2025, according to Bloomberg data. Cosco Shipping Holdings, Guanghui Energy and coal producer Yankuang Energy Group are its biggest constituents.
The 49 companies on the Hang Seng High Dividend Yield Index reported HK$897.23 (US$114) per share by the first quarter, up 6.2 per cent from the third quarter of last year, the data showed. Its members include Hang Lung Properties, CK Infrastructure and Power Assets Holdings.
“In today’s environment – with China’s recovery still uneven, confidence subdued and private-sector investment appetite weak – companies are finding fewer productive places to deploy capital,” said Charu Chanana, chief investment strategist at Saxo. “That makes buy-backs and dividends a more credible use of cash. The market is right to look at cash-rich China- and Hong Kong-listed companies as potential shareholder-return plays, especially where valuations are depressed and policy is pushing companies to lift dividends and buy-backs.”
