Longriver Gathering 2024

Last weekend, twenty-five friends joined me in Shenzhen for the 2024 Longriver Gathering, an event ‘by investors, for investors,’ aimed at building community, sharing ideas and identifying our blind spots. Run at cost, the price of admission is an open mind and a willingness to reciprocate.

I confess that the mood this year was polarised, especially with a certain Chinese eCommerce company’s confounding 2Q results still fresh in our minds.

While this is not a China conference, per se, most of us either come from China or self-select based on our interest in this market. The Bulls argued that Chinese stocks have never been cheaper, that tough times cull weak competitors, and that the strong are returning capital. The Bears pointed out that the macro data still warrants caution, that this is not a capitalist country and that we should be mindful of ‘Stockholm Syndrome’ when rationalising the events of the past few years. Who’s seeing the forest and who the trees?

The specific companies presented ran the gamut from scrappy Filipino LPG distributor Pryce Corp to dominant Japanese semi-cap player Tokyo Electron; and from deeply discounted Hong Kong real estate conglomerate Great Eagle to a bankruptcy lawyer’s analysis of online used car dealer Carvana’s darkest days in late 2022. My warmest thanks to everyone for the time and care which went into these.

Here are some fun insights I gained:

~ Didi drivers are very loyal to the ride-sharing platform because it’s their best alternative. How do you know? Become a driver for four months! (H/t April Li)

~ Swimmer Pan Zhanle and Game Science’s Black Legend: Wukong might be the biggest boost for Chinese soft power since silk and tea! (H/t Mike Chan, CFA)

~ Software engineers love new products like Cloudflare’s Workers because introducing ‘the new new thing’ helps them get promoted and paid more. Follow the incentives! (H/t Brandon Wang)

~ As coal stock AMR demonstrated, the path to 100x returns in four years lies in the collision of inelastic supply, inelastic demand, high operating leverage, a heavily indebted balance sheet, and low starting multiples. Be on the lookout! (H/t Damon Meng)

~ Corporate governance has become such a hot topic in South Korea that both main political parties are now competing to propose the best reform package! (H/t Young Peck)

~ As America rushes to build energy-hungry AI data centres, Bitcoin Miners may be worth more dead than alive, thanks to their long-term, low-cost clean power offtake agreements! (H/t Brian Mushonga)

My own contribution compared the Chinese and Irish housing markets to emphasise the global investor’s advantage of choosing the best (simplest?) opportunities, no matter where they are. You can see my presentation here (link) and I will follow up with a full write-up in due course. I was honoured to take questions on global investing alongside Ning Jia from Shanghai and Rob Vinall from Switzerland.

I was delighted to meet some new folks and, of course, to see old friends who had flown in from afar. Now that we’ve held the Longriver Gathering twice, it's practically a tradition, so I hope we can get together again next year.

Please drop me a line if you want to learn more. Pros and dedicated hobbyists are all welcome.