GMT Research

GMT Research GMT Research provides independent insight into markets, sectors and companies throughout Asia. Thematic accounting makes up 75% of our output.

We are an accounting research firm focused on Asia and regulated by Hong Kong’s Securities and Futures Commission. Our primary goal is to use financial statements to judge whether a company is over-or-understating its profits through the exploitation of accounting standards. We publish around twenty in-depth reports each year across three product lines:
1. We pick a particular accounting or corpor

ate governance issue, explain it and then highlight companies with potential problems.
2. We write two-to-four in-depth company-specific reports each year. Within these accounting exposés, we highlight companies with particularly egregious accounting.
3. We write two micro-strategy reports each year. We have developed a methodology to analyse the financial statements of 36,000 listed companies across 30 markets globally. This enables us to assess where the corporate sector lies within the economic business cycle and helps tell us where we should look for our longs and our shorts

28/01/2019

Accounting standards are designed to make life easy for investors. As such, companies moving away from GAAP measures should be regarded with suspicion. Our review of the 30 largest Chinese domiciled ADRs shows an increasing use of adjusted, vaguely defined and non-GAAP metrics which, in some cases, greatly exaggerates performance. This has likely led to inflated valuations and created a potential shorting opportunity as reality bites. The worst culprits are Bitauto, JD.com, Pinduoduo and Vipshop.

20/07/2017

It’s every fund manager’s nightmare to discover that a holding has been targeted by a short-seller alleging fraud. Our analysis of over 80 previous fake cash flow frauds shows some recurring similarities, such as superb profitability combined with low levels of debt, and yet a stingy attitude towards dividends. In this report, we discuss our scoring system that correctly identifies 73% of historic frauds but is triggered by less than 1% of all listed companies globally – except for China and Hong Kong where it is 6-7%.

09/12/2016
09/12/2016
09/12/2016
09/12/2016

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