M N 2 Apr 2024 CMB International Global Markets | Equity Research | Company Update Tigermed (300347 CH) Expect business rebound in 2024E Target Price RMB68.57 Tigermed reported 2023 revenue of RMB7,384mn, up 4.2% YoY, and attributable (Previous TP RMB80.31) recurring net income of RMB1,477mn, down 4.1% YoY. Revenue/ attributable Up/Downside 29.1% recurring net income missed our forecast by 2.9%/ 12.1%, respectively, mainly Current Price RMB53.10 due to shrinking COVID vaccine revenue, slowdown in global R&D ...

Investment Rating - The report maintains a "BUY" rating for Xiaomi with a new SOTP-based target price of HK$22.19, reflecting a 49% upside from the current price of HK$14.94 [1][15]. Core Insights - Xiaomi's SU7 Series electric sedans launched on March 28, 2024, with competitive pricing and strong initial pre-orders, indicating positive market reception. The pre-orders reached 50,000 units in the first 27 minutes and 89,000 units within 24 hours, surpassing market expectations [1][2]. - The report highlights Xiaomi's unique "Human-car-home" ecosystem as a major competitive advantage over other EV brands, which is expected to drive future growth [1][2]. - Adjustments to revenue forecasts reflect expected EV shipments of 80,000, 150,000, and 200,000 units for FY24, FY25, and FY26, respectively [1][2]. Financial Summary - Revenue for FY24 is projected at RMB 321,495 million, with a year-on-year growth of 18.6%. The adjusted net profit is estimated at RMB 17,321 million, reflecting a decline of 10.1% year-on-year [4][10]. - The report indicates a gross margin of 19.0% for FY24, with an operating margin of 4.8% and an adjusted net margin of 5.4% [10][11]. - The earnings per share (EPS) for FY24 is projected at RMB 0.70, with subsequent years showing gradual increases [4][10]. Valuation Methodology - The valuation is based on a sum-of-the-parts (SOTP) approach, assigning different price-to-earnings (P/E) multiples to Xiaomi's various business segments: 13x for smartphones, 10x for AIoT, and 15x for internet services. The EV business is valued at 0.75x FY25E price-to-sales (P/S) [15][16]. - The total valuation for Xiaomi is estimated at RMB 508,115 million, leading to a target price of HK$22.19 [16].

Investment Rating - The report maintains a BUY rating for Joinn Laboratories with a target price revised to HK$14.41 from HK$21.18, reflecting a potential upside of 57.1% from the current price of HK$9.17 [2][4]. Core Insights - Joinn Laboratories reported a revenue of RMB2,376 million for 2023, representing a 4.8% year-over-year increase, while attributable net income fell by 66.9% to RMB338 million due to fair value losses from biological assets [2]. - The company anticipates that revenue for 2024 will remain on par with 2023, facing continued pressure on profitability due to uncertainties in the R&D recovery of the domestic pharmaceutical market [2]. - Early signs of stabilizing client demand were noted, with a 20% year-over-year growth in contract booking volume in January-February 2024 [2]. - Joinn's overseas business saw a significant revenue increase of 51% year-over-year in 2023, driven by the performance of Biomere [2]. Financial Summary - For FY23, Joinn's revenue was RMB2,376 million, with a projected revenue of RMB2,425 million for FY24, indicating a modest growth of 2.0% [3][9]. - Adjusted net profit for FY23 was RMB481.6 million, with expectations of RMB436 million for FY24, reflecting a decline of 9.5% [3][9]. - The company’s gross profit margin is expected to decrease to 38.08% in FY24, with operating and net margins also projected to decline [5][12]. Operational Developments - Joinn has completed the construction of its Phase II facilities in Suzhou and is strategically planning the operational launch of these sites in line with market conditions [2]. - The company plans to hire an additional 100-200 staff in 2024 to support growth in emerging service areas, particularly clinical services [2]. Valuation Metrics - The report provides a DCF valuation with a WACC of 12.2% and a terminal growth rate of 2.0%, leading to a target price of HK$14.41 per share [7][4]. - The adjusted EPS for FY24 is projected at RMB0.58, with a P/E ratio of 15.5x for FY24 [3][12].

Investment Rating - Maintain BUY rating with a new target price (TTM) of HK$11.9, implying 1.0x FY24E P/B [2][7] Core Views - PICC P&C reported a solid underwriting combined ratio (CoR) of 97.8%, 0.3pct lower than the estimate, driven by better-than-expected non-auto CoR at 99.1% [2] - The company is expected to sustain a payout ratio of over 40% in the next two years, with a dividend yield of 5.7% in FY24E [2][7] - The auto segment met guidance with a CoR of 96.9%, while non-auto outperformed, particularly in individual A&H, which achieved RMB1.0bn underwriting profits [2] - The company's long-term auto premium growth is adjusted to 5%, with NEV profitability expected to improve [2] Financial Performance - Net profit for FY23A was RMB24.6bn, with EPS of RMB1.11, and is expected to grow to RMB30.0bn in FY24E [4] - The combined ratio is forecasted to improve from 97.8% in FY23A to 96.9% by FY26E [4] - ROE is expected to recover from 10.8% in FY23A to 12.6% by FY26E [4] Valuation - The stock is currently trading at 0.84x FY24 P/B, with a target valuation of HK$11.9 based on P/B-ROE [7][8] - Key valuation assumptions include a long-term growth rate of 3%, a revised long-term ROE of 12.8%, and a cost of equity of 9.7% [7] Dividend Policy - The company raised DPS by 2.3% YoY to RMB0.489 per share in 2023, maintaining a payout ratio of 44.2% [2] - Management guided to maintain a robust payout ratio of over 40% in the next two years [2] Segment Performance - Auto premiums grew by 5.3% YoY to RMB285.6bn, with a conversion rate of 98.8% [2] - Non-auto individual A&H achieved RMB43.7bn in insurance revenue, growing 23.8% YoY, with a CoR of 97.7% [2] Future Outlook - The company expects a lift in auto comprehensive loss ratio and a contraction in comprehensive expense ratio to 70.6%/26.1% in FY24E [2] - NEV profitability is anticipated to improve, with NEV CoR expected to drop below 100% [2]

M N 29 Mar 2024 CMB International Global Markets | Equity Research | Company Update BYDE (285 HK) Reiterate BUY on multiple growth drivers in 2024 Target Price HK$46.51 Reiterate BUY and raise TP to HK$46.51 (61% upside) to reflect a strong (Previous TP HK$45.86) outlook and multiple growth drivers in 2024: 1) Android high-end demand Up/Downside 61.2% recovery (e.g. Huawei, Xiaomi); 2) Jabil sales synergy and strong ramp in 2H24; Current Price HK$28.85 3) Apple’s share gain with sales contribution rising to ...

Investment Rating - Maintain BUY with a new target price of HK$8, based on 11x 2024E P/E, reflecting a significant decrease from the previous target price of HK$15.40 [2][4] Core Views - The solar power business remains a major concern for investors, leading to a downward revision of earnings forecasts by 27% for 2024E and 30% for 2025E [2] - Despite challenges in the solar segment, overseas sales of large mining trucks and telescopic handlers are expected to drive growth [2] - The company aims for RMB5 billion in revenue from solar products, equipment, and solar farms in 2024E, with a focus on business diversification [2] Earnings Summary - Revenue for 2023 was RMB20.3 billion, a 30.5% increase YoY, with adjusted net profit at RMB1.9 billion, reflecting a 15.9% growth YoY [3][5] - The net debt/equity ratio is projected to rise to 30.8% in 2024E, up from 21% at the end of 2023 [2][5] - The company targets revenue growth to RMB26.7 billion in 2024E, with a projected adjusted net profit of RMB2.1 billion [3][12] Segment Performance - Revenue from large mining trucks surged 4.9x YoY to RMB1.1 billion in 2023, with a target of RMB1.8 billion in 2024E [2] - Telescopic handlers also showed significant growth, with revenue increasing 2.6x YoY to RMB760 million in 2023, targeting RMB1.5 billion in 2024E [2] - Large-size port machinery revenue was RMB1.2 billion in 2023, with a backlog of RMB3.6 billion providing visibility for future revenue [2] Regional Revenue Breakdown - Revenue from Mainland China increased to RMB13.9 billion in 2023, while sales in Russia grew significantly by 175.6% [9] - The company experienced a decline in sales to the USA, which dropped by 12.9% [9] Key Financial Metrics - The adjusted EPS for 2024E is projected at RMB0.67, with a P/E ratio of 6.9x [3][12] - The company’s gross margin is expected to stabilize around 25.6% in 2024E [10]

Investment Rating - Maintain BUY with a new target price of HK$22.0 [2][6] Core Viewpoints - ZhongAn reported a significant turnaround in FY23, with net profit attributable to shareholders reaching RMB4.1bn, compared to a net loss of RMB1.1bn in FY22 [2] - Excluding the one-off gain from the disposal of ZA International (RMB3.78bn), the insurer recorded a net profit of RMB294mn, in line with consensus [2] - The company's growth is driven by its digital lifestyle ecosystem, technology export, and ZA Bank's breakeven progress [2][6] Domestic P&C Insurance - Domestic P&C insurance premiums grew by 33.1% YoY in 2H23, driven by digital lifestyle-related products such as e-commerce cargo insurance, travel insurance, and pet insurance [2] - The underwriting combined ratio (CoR) rose 1.0ppt to 95.2% in 2023, but underwriting profit (UWP) increased by 1.7% YoY to RMB1.3bn due to higher insurance revenue (+24.2% YoY) [2] - The health segment saw a 130.6% YoY increase in gross written premiums (GWP) for critical illness insurance, reaching RMB1.3bn in 2023 [2] Technology Export - Revenue from domestic technology export surged 73% YoY to RMB504mn in 2023, benefiting from the Digital China initiative [2] ZA Bank Performance - ZA Bank's net revenue increased by 42.9% YoY to RMB366mn in 2023, with a net interest margin (NIM) expansion of 10bps to 1.94% [2] - The bank launched US-stock trading in January 2024, which is expected to attract tech-savvy customers and improve retention [2] Proprietary Channels - Premiums from proprietary channels grew 31.0% YoY to RMB7.6bn, accounting for 26% of total GWP [2] - In the Health ecosystem, GWP from proprietary channels increased by 45.0% YoY to RMB4.4bn, representing 44.5% of total Health GWP [2] - The number of paid customers rose 14.8% to 11.43mn, with premiums per user increasing by 14.4% YoY to RMB670 [2] Financial Projections - FY24-26E net profit is projected at RMB434mn, RMB547mn, and RMB678mn, respectively [3] - The underwriting combined ratio (CoR) is expected to remain stable at 95.8%/96.0%/96.0% for FY24-26E, with underwriting profits projected at RMB1.38bn/RMB1.56bn/RMB1.77bn [6] Valuation - The stock is trading at FY24E 0.9x P/B and FY24E 0.5x P/S [5] - The fair value is based on a FY24E P/B of 1.46x, implying a 20-year growth rate of 8% [6]

Investment Rating - The report maintains a "BUY" rating for DPC Dash with a target price of HK$73.05, reflecting a potential upside of 25.2% from the current price of HK$53.50 [6][8][17]. Core Insights - DPC Dash's FY23 results were in line with expectations, showing a 51% year-on-year revenue growth to RMB 3.1 billion, driven by strong same-store sales growth (SSSG) and increased sales per store in new growth markets [2][9]. - The company is optimistic about FY24E, expecting continued positive SSSG despite challenges such as a high base from FY23 and seasonal factors affecting sales [2][9]. - The management has reiterated its store opening plan, targeting 240 new stores in FY24E, with a more positive outlook for FY25E-26E, aiming for 300 to 350 new stores [9][10]. Financial Summary - Revenue is projected to grow from RMB 3,051 million in FY23A to RMB 4,118 million in FY24E, representing a 35% year-on-year increase [3][10]. - The adjusted net profit margin is expected to improve to 1.3% in FY24E, with net profit projected to turn positive at RMB 15 million [3][10]. - The company’s gross profit margin is forecasted to remain stable at around 72.6% for FY24E [10][11]. Sales and Growth Projections - DPC Dash's sales per store in Beijing and Shanghai are expected to grow by 3% and 5% respectively, while new growth markets are anticipated to see higher growth rates [2][10]. - The company has seen strong initial sales in new cities, with first-month sales exceeding RMB 5 million in locations like Xi'an and Changsha [2][9]. - The delivery mix in new growth markets remains low at 42%, indicating potential for future growth in SSSG [2][9]. Valuation Metrics - The report indicates that DPC Dash is currently trading at 1.5x FY24E P/S, which is higher than the peer average of 1.3x, but still considered attractive due to a projected 32% sales CAGR from FY23 to FY26E [2][6][13]. - A DCF valuation method supports a share price estimate of HK$73.14, aligning closely with the target price based on P/S multiples [17][18].

Investment Rating - The report maintains a "Buy" rating for the company, with a target price currently under review [1][3]. Core Insights - The company reported a revenue and net profit growth of 33.4% and 62.2% respectively in 2H23, exceeding expectations. The overall revenue and net profit for the year reached new highs, with a gross margin increase of 2.1 percentage points to 59.5% and a net profit margin at a historical high of 28% [1]. - The sugar-free tea business has significantly increased its contribution to nearly 30% of total revenue, while the share of packaged water has decreased to 48%. The company aims for double-digit growth across all business segments in 2024 [1]. - The company does not prioritize maintaining high gross margins and expects long-term profit margins to revert to around 25%. The growth in profitability is anticipated to outpace revenue growth, supported by controlled material costs and improved operational efficiency [1]. Financial Summary - For FY23E, the company expects sales revenue to reach RMB 42,194 million, with a year-on-year growth of 26.9%. Net profit is projected at RMB 11,179 million, reflecting a 31.6% increase [2][11]. - The earnings per share (EPS) for FY23E is estimated at RMB 0.99, with a price-to-earnings (P/E) ratio of 38.7 [2][11]. - The company’s gross profit margin is expected to be 59.4% for FY23E, with an EBIT margin of 33.2% and a net profit margin of 26.5% [7][11]. Market Performance - The current market capitalization of the company is approximately HKD 209,947 million, with a 52-week stock price range of HKD 46.30 to HKD 38.50 [4]. - The stock has shown a potential upside of 40.0% from the current price of HKD 41.3 to the target price of HKD 57.8 [3][4].

Investment Rating - The report maintains a "BUY" rating for the company with a new target price of HK$52.00, implying a 57.6% upside from the current price of HK$33.00 [21][24]. Core Insights - The company reported a decline in OPAT by 19.7% to RMB 118.0 billion, primarily due to a net loss of RMB 20.7 billion from asset management. Despite this, the company sustained dividend per share (DPS) growth to RMB 2.43, reflecting a 37.3% payout on shareholders' OPAT [21][24]. - The life and health (L&H) value of new business (VNB) amounted to RMB 39.3 billion, representing a 36.2% year-on-year increase, driven by stable VNB margins [21][24]. - Economic assumptions were adjusted, lowering the long-term investment return from 5.0% to 4.5% and the risk discount rate from 11% to 9.5%, which resulted in a significant impact on the embedded value (EV) and VNB [21][24]. Financial Summary - For FY23, net profit attributable to shareholders was RMB 85.7 billion, down 22.8% from the previous year, with a reported EPS of RMB 4.84 [29][30]. - The company’s total assets are projected to grow from RMB 11,583.4 billion in FY23 to RMB 13,760.7 billion by FY26, indicating a steady increase in asset base [11]. - The return on equity (ROE) is expected to improve from 9.7% in FY23 to 14.3% by FY26, reflecting enhanced profitability [30]. Valuation Metrics - The stock is currently trading at 0.45x FY24E P/EV, with a target valuation of 1.0x FY24E P/EV and 0.9x FY24E P/B [24][28]. - The company’s dividend yield is projected to increase from 6.9% in FY23 to 8.7% by FY26, indicating a strong return to shareholders [3][30]. Embedded Value and Sensitivity Analysis - The Group's embedded value is estimated at RMB 1,390.1 billion for FY23, reflecting a decrease of 6.7% due to the revised economic assumptions [21][25]. - The sensitivity analysis indicates that a 50 basis point decrease in long-term investment return could lead to a 7.6% decline in Group EV [8][21].