CK Infrastructure’s Victor Li open to investing in Hong Kong if project yields ‘reasonable returns’

CK Infrastructure, along with group companies CK Asset and Power Assets, is seeking avenues to invest its HK$13 billion (US$1.7 billion) cash pile
‘Hong Kong is our hometown, [and] if there are projects with reasonable returns, we will definitely invest,’ Victor Li says at annual general meeting on Wednesday

Li Ka-shing

Salina Li

Published: 3:33pm, 22 May 2024

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CK Infrastructure Holdings (CKI) will look to invest in Hong Kong provided the returns are reasonable even as it scours opportunities globally, according to chairman Victor Li Tzar-kuoi.

CKI has been deploying its HK$13 billion (US$1.7 billion) cash hoard to snap up utilities, picking up renewable energy assets in the UK as part of a consortium with group companies CK Asset Holdings and Power Asset Holdings.

The group has been on an asset shopping spree since the outbreak of the Covid-19 pandemic, taking advantage of cheap valuations caused by the pandemic-led global economic slump to hunt for bargains.

“Hong Kong is our hometown, [and] if there are projects with reasonable returns, we will definitely invest,” said Li, the elder son of tycoon Li Ka-shing, during CKI’s annual general meeting on Wednesday.

The flags of CK group companies fly outside the Cheung Kong Center building in Hong Kong. Photo: Dickson Lee

Li also reiterated comments made in March about strengthening Hong Kong’s status as an international financial centre, as the city faced headwinds from global economic turmoil. He had made the comments after his two flagship companies CK Hutchison Holdings and CK Asset Holdings reported lower full-year profits for 2023.

“If we have more multinational corporations and family offices established here, regardless of ethnicity or nationality, Hong Kong’s position as an international financial market should be and would be further strengthened,” Li said.

The foundation of Hong Kong’s economy would be more solid and this would facilitate the long-term development of the city, he added.

Earlier this month, CKI bought UU Solar, which owns and operates 70 renewable power-generation assets in the UK, for £90.8 million (US$113.5 million).

It was the company’s second investment in two weeks, following on the heels of its acquisition of Lionrai Investments No. 1, which owns natural gas network company Phoenix Energy, one of three gas distribution network operators in Northern Ireland. CKI bought the asset from NatWest Group Pension Fund and Utilities Trust of Australia for £757 million.

“Any project that provides quality assets and can yield favourable returns, regardless of its location, will be considered by the group,” Li said.

With a strong financial position, CKI has an edge in capturing new opportunities in volatile economic conditions, he added.

CKI reported a 3.6 per cent year-on-year growth in net profit to HK$8 billion for 2023, while it had a low gearing ratio of 7.7 per cent.

Europe and Australia accounted for most of the company’s profit, even as it struggled at home. Profit contribution from Hong Kong and mainland China fell 40 per cent to HK$117 million, CKI said in its annual report, citing poor performance of its infrastructure materials manufacturing business amid a “major decline” in construction activity in mainland China.

Infrastructure investments in Hong Kong and mainland China fell to HK$111 million in 2023 from HK$183 million in 2022.

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