Largest China Companies That We Can Invest In Today

Even with greater uncertainties, it’s hard to completely ignore Chinese companies.

by
Dinesh Dayani
March 31, 2022

China’s economy has been on a nearly 40-year growth tear. A recent Forbes article reported that within a single generation, its GDP per capita, after adjusting for inflation, was 17 times higher than it was during 1980.

In that time, China has also grown from a third-world nation into a global super-power. Boasting the second-largest economy today, China is poised to wrestle the top spot from the U.S. by 2028. Despite COVID-19 hammering the global economy, China’s GDP growth has continued to outpace other major economies.

Chinese companies have been the backbone and main beneficiaries of this growth over the decades. Unlike the 1980s, Chinese brand names today do not look out of place beside their global peers. We look at the 10 largest Chinese companies that we can invest in today. Not all Chinese companies are listed in China – perhaps due to the closed-off nature of its capital markets.

#10 China Mobile (HKG: 0941)

Market Capitalisation: US$155 billion

Listing Status: Hong Kong Stock Exchange (HKEX)

Year-to-date Performance: 15%

5-year Performance: -37%

Based in China, China Mobile is the world’s largest telecommunications service provider with 942 million mobile customers and 210 million broadband customers. The firm provides world-class telecommunications infrastructure throughout all 31 provinces, autonomous regions and directly-administered municipalities throughout the mainland of China and in Hong Kong Special Administrative Region.

In 2020, China Mobile was selected as part of Forbes Magazine’s Global 2,000 World’s Largest Public Companies list and Fortune magazine’s Fortune Global 500 list.

#9 PetroChina Company Limited (NYSE: PTR) (SSE: 601857) (HKG: 0857)

Market Capitalisation: US$158 billion

Listing Status: New York Stock Exchange (NYSE); Shanghai Stock Exchange (SSE); Hong Kong Stock Exchange (HKEX)

Year-to-date Performance: 18%

5-year Performance: -27%

PetroChina was formed in 1999, after the restructuring of state-owned China National Petroleum Corporation (CNPC). Listed in the U.S., Hong Kong and China’s Shanghai Stock Exchange, PetroChina is one of the largest oil & gas producers in Asia.

In FY2020, PetroChina’s revenue declined over 23% to RMB1.9 trillion (US$304 billion). This was partly due to COVID-19 and the subsequent “cliff-like” drop in international crude oil prices. The pandemic also impacted supply of oil.

#8 Agricultural Bank of China (SSE: 601288)

Market Capitalisation: US$164 billion

Listing Status: Shenzhen Exchange (SZSE)

Year-to-date Performance: 4%

5-year Performance: -8%

Also known as ABC, the Agricultural Bank of China is one of the “Big four” Chinese banks. It has a global footprint, with branches in mainland China, Hong Kong, London, Tokyo, New York, Frankfurt, Sydney, Seoul, and Singapore.

The bank has 320 million retail customers, 2.7 million corporate clients, and approximately 24,000 branches. Currently, the bank employs more than 467,000 employees.

#7 Contemporary Amperex Technology Limited (CATL) (SZSE: 300750)

Market Capitalisation: US$178 billion

Listing Status: Shenzhen Exchange (SZSE)

Year-to-date Performance: -11%

5-year Performance: 852%

A global leader in lithium-ion battery manufacturing, CATL is operating within a highly exciting EV space. According to its website, it is ranked no. 1 globally for EV battery consumption volume for four consecutive years (by SNE Research).

Apart from its strong Chinese presence, it also has a global footprint spanning Japan, Germany, France and the USA. According to various online sources, its client list includes Tesla, BMW, Daimler, Honda, Toyota, Volkswagen and Volvo.

#6 China Construction Bank (CCB) (SSE: 601939) (HKG: 0939)

Market Capitalisation: US$186 billion

Listing Status: Shanghai Stock Exchange (SSE); Hong Kong Stock Exchange (HKEX)

Year-to-date Performance: 6%

5-year Performance: 6%

Another major Chinese bank, CCB is listed on both the Hong Kong and Shanghai stock exchanges. The bank employs over close to 350,000 people at its 14,741 banking outlets. CCB has a presence covering 31 countries and regions globally – making it a global bank.

CCB is the second largest bank in China, and similar to Wuliangye Yibin, this also makes it the no. 2 biggest bank in the world.

#5 China Merchants Bank (SHA: 600036) (HKG: 3968)

Market Capitalisation: US$187 billion

Listing Status: Shanghai Stock Exchange (SSE); Hong Kong Stock Exchange (HKEX)

Year-to-date Performance: 16%

5-year Performance: 200%

Anyone remotely familiar with investing in China would have heard of China Merchants Bank. Founded in 1987, it has over 1,800 branches worldwide and features regularly on the Fortune Global 500 list.

China Merchants Bank employs over 70,000 people in its diverse operations spanning commercial banking, financial leasing, fund management, life insurance and investment banking.

#4 Industrial & Commercial Bank of China (ICBC) (HKG: 1398); (SSE: 601398)

Market Capitalisation: US$268 billion

Listing Status: Hong Kong Stock Exchange (HKEX); Shanghai Stock Exchange (SSE)

Year-to-date Performance: -17%

5-year Performance: 12%

Another Chinese bank that needs no introduction, ICBC is the biggest bank in China with 680 million retail customers and over 8 million corporate customers. This also makes it the biggest bank in the world with over US$4 billion in assets.

ICBC also regularly features as the top bank in the world in various lists such as Top 1,000 World Banks, Global 2,000 by Forbes and Fortune’s Global 500.

#3 Kweichow Moutai (SSE: 600519)

Market Capitalisation: US$267 billion

Listing Status: Shanghai Stock Exchange (SSE)

Year-to-date Performance: -16%

5-year Performance: 344%

China’s most valuable non-technology company, Kweichow Moutai is also the world’s largest distillery and most valuable listed beverage company. Producing baijiu, the alcohol of choice in China, Kweichou Moutai has also likely benefitted from less external travel due to COVID-19 and rising patriotism for Chinese brands.

Disregarding companies not listed in China – i.e. the next two entries which are listed in Hong Kong and the U.S. – Kweichow Maoutai would be considered the most valuable listed company in China.

#2 Alibaba Group (NYSE: BABA); (HKG: 9988)

Market Capitalisation: US$317 billion

Listing Status: New York Stock Exchange (NYSE); Hong Kong Stock Exchange (HKEX)

Year-to-date Performance: -3%

5-year Performance: 8%

This company needs no introduction. It’s businesses span e-commerce, grocery chains, food delivery, video streaming, logistics, cloud infrastructure and more. Unfortunately, one of the major talking about for Chinese businesses is the fact that Ant Financial’s much-hyped IPO was pulled at the last minute by the Chinese authorities. Chinese tech shares have also been hard-hit – affecting Alibaba’s share price.

Alibaba’s shares were also hit during the recent round of tightened measures the Chinese authorities intend to place on foreign-listed businesses. Due to this double whammy, Alibaba’s share price suffered, even though its operations have continued to run relatively smoothly.

#1 Tencent Holdings (HKG: 0700)

Market Capitalisation: US$460 billion

Listing Status: Hong Kong Stock Exchange (HKEX)

Year-to-date Performance: -17%

5-year Performance: 68%

Tencent is the most valuable Chinese business today – after the hits taken by Alibaba in the past couple of years.

The most well-known of its businesses is its WeChat super app. On top of this, Tencent has its hands in numerous businesses, including gaming, fintech, video streaming, music, cloud infrastructure and many more.

Investing In The Biggest Chinese Companies In The World

With the Chinese economy set to become the biggest in the world in the next decade, we can only expect its companies to similarly continue growing. While we can see that the 1-year returns can fluctuate from company to company, they are generally growing in the past 5 years.

The biggest economy in the world should ultimately house some of the biggest companies in the world – and it won’t be a surprise if a Chinese company becomes the biggest company in the world in the coming years.

This article was first published on 13 July 2021 and has been updated with the latest information.

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