Core Viewpoint - The domestic airline stocks have shown an upward trend, driven by strong performance in the third quarter of 2025, with major airlines reporting revenue growth and profitability due to summer travel and foreign exchange gains [1] Group 1: Airline Stock Performance - Eastern Airlines (00670) increased by 3.26%, trading at 4.44 HKD; Air China (00753) rose by 2.91%, trading at 6.36 HKD; Southern Airlines (01055) gained 2.63%, trading at 5.08 HKD; Capital Airport (00694) saw a 1.06% increase, trading at 2.85 HKD [1] - The three major airlines reported a combined net profit of 10.27 billion HKD in the third quarter, up from 9.19 billion HKD in the same period last year [1] Group 2: Market Outlook - According to Guotai Junan Securities, the October holiday period is expected to see a 5% year-on-year increase in passenger traffic, with domestic jet fuel prices remaining stable while ticket prices are projected to rise by 3-4% compared to September [1] - The Chinese aviation industry is anticipated to achieve profitability in October, outperforming typical seasonal performance, with expectations of entering a "super cycle" driven by market-driven ticket pricing, steady demand growth, and optimized passenger structure [1]

Major Events - Bluestar Jiahe Services (02606.HK) plans to repurchase up to 10% of its issued H-shares [1] - China People's Insurance Group (01339.HK) reported original premium income of 97.985 billion yuan in January, a year-on-year increase of 6.67% [1] - Hengteng Network (00136.HK) signed a strategic cooperation agreement with Evergrande Tourism Group [1] Financial Data - New Star Printing (01975.HK) achieved a net profit of 27.5 million HKD in the interim period, with an interim dividend of 1.5 HKD cents [1] Earnings Forecast - Qihua Environmental Protection (00976.HK) expects an increase in annual net loss [1] - Zhuyou Intelligent Manufacturing Technology (00726.HK) anticipates a net profit increase of approximately 40.8% for the year [1] - Birmingham Sports (02309.HK) raised its earnings forecast, expecting a mid-term profit of 70 million HKD [1] - Huazhang Technology (01673.HK) expects a mid-term profit of 15 to 20 million yuan, turning from loss to profit year-on-year [1] - Raffles Interior (01376.HK) anticipates a net loss of 4.5 million Singapore dollars for the 2020 fiscal year [1] - Fengcheng Holdings (08216.HK) expects a net profit increase of over 50% for the year [1] - New Fengtai Group (01771.HK) forecasts a net profit growth of approximately 20% for the year [1] - Yefeng Group (01695.HK) expects an annual loss not exceeding 4 million Malaysian ringgit [1] Operational Data - China People's Insurance Group (01339.HK) reported original premium income of 97.985 billion yuan in January, a year-on-year increase of 6.67% [1] - New China Life Insurance (01336.HK) reported original premium income of 34.63 billion yuan in January, a year-on-year increase of 12.78% [1] - China Property & Casualty Insurance (02328.HK) reported original insurance premium income of 53.112 billion yuan in January, a year-on-year increase of 1.2% [1] - China Metallurgical Group (01618.HK) signed new contracts worth 103.59 billion yuan in January, a year-on-year increase of 129.7% [1] - China Eastern Airlines (00670.HK) reported a 60.59% year-on-year decline in passenger turnover in January [1] - Sinopec Oilfield Services (01033.HK) recently signed overseas contracts worth 2.323 billion yuan [1] - China Southern Airlines (01055.HK) reported a 59.16% year-on-year decline in passenger turnover in January [1] - Huili Group (00806.HK) reported total managed assets of approximately 14.8 billion USD at the end of January [1]

Investment Rating - The report maintains a "Recommendation" rating for the transportation industry [3] Core Insights - The transportation industry is experiencing a recovery, with various segments showing potential for growth, particularly in shipping, infrastructure, aviation, and express delivery [7][19][22][20] Shipping - The shipping sector is seeing mixed price movements, with the SCFI for the US East route down 17.2% and the Southeast Asia route up 6.4% [11] - The report highlights the importance of monitoring the price increases in container shipping and the potential recovery in oil tanker rates due to improved US-China trade relations [16][12] Infrastructure - Key metrics indicate a decline in truck traffic and railway cargo, while port throughput has increased significantly, suggesting a shift in market dynamics [17][18] - The report emphasizes the potential for dividend stocks in the infrastructure sector, particularly in ports, which are currently undervalued [19] Aviation - The aviation sector shows a positive trend with a 7.2% year-on-year increase in passenger volume, driven by improved demand and a low base effect [22] - The report suggests that the industry is poised for profitability in 2026, with a focus on valuation recovery and potential investment opportunities in major airlines [22] Express Delivery - The express delivery sector is benefiting from a reduction in price competition, with a notable increase in business volume and revenue [20] - The report indicates that the "anti-involution" policies are helping to stabilize prices and improve profitability in the sector [20] Logistics - The logistics segment is experiencing stable performance, with cross-border air freight prices showing a week-on-week increase [23] - The report notes the importance of monitoring the daily traffic at key ports and the implications for logistics operations [23]

Core Insights - The civil aviation industry is experiencing a strong recovery driven by local market growth and globalization, despite challenges from the pandemic, de-globalization trends, and geopolitical conflicts [2] - The China International Import Expo (CIIE) serves as a platform for Chinese aviation companies to establish partnerships and sign procurement agreements with global partners, enhancing cooperation within the industry [2] Cooperation and Agreements - During the 8th CIIE, the aviation sector emerged as a major player, with Shanghai P&W signing a procurement order exceeding $100 million for V2500 engine parts with IAE, marking the first deal of the expo [3] - China Eastern Airlines (CEA) signed 19 procurement agreements with suppliers from 9 countries, totaling $1.211 billion, focusing on high-tech products essential for aviation operations [4] - Honeywell announced a partnership with CEA for material procurement and maintenance, emphasizing the importance of timely material reserves for fleet operations [4][5] - Airbus secured a deal with China Southern Airlines to install the HBCplus in-flight connectivity system on 30 A350 aircraft, marking a significant step in enhancing service offerings in the Chinese market [5][6] Market Trends and Projections - The global aviation service market in China is projected to surpass North America and Europe, growing from $23 billion in 2024 to $61 billion by 2043 [6] - GE Aviation signed multiple agreements during the expo, with total orders nearing $2.1 billion, reflecting strong demand for aviation services and components [6] Industry Challenges - The aviation industry faces ongoing supply chain crises, which are expected to impact operations for several years, leading to increased costs and extended use of older aircraft [8][9] - The International Air Transport Association (IATA) highlighted that supply chain bottlenecks are delaying the production of new aircraft and parts, necessitating a reevaluation of fleet plans by airlines [8] - The rising costs and supply chain challenges are limiting airlines' ability to meet growing passenger demand, with a projected 10.4% increase in demand for 2024 [8][9] Strategic Responses - Companies are focusing on enhancing operational efficiency and reducing costs to improve performance amidst ongoing challenges [9] - Airbus's support services are crucial for operators, providing comprehensive material support and logistics services to enhance operational efficiency [9] - GE Aviation is increasing investment in its Suzhou facility to boost production capabilities, with an investment of $8.5 million planned for 2024-2025 [10]

Core Points - The eighth China International Import Expo was held in Shanghai, where Airbus signed an agreement with China Southern Airlines to install the next-generation in-flight high-speed connectivity system HBCplus on 30 A350 aircraft [1][3] - China Southern Airlines becomes the first airline in China to adopt the HBCplus system, with the first equipped aircraft expected to enter service in 2026 [1][3] Group 1: HBCplus System Overview - HBCplus stands for High Bandwidth Connectivity Plus, developed and integrated by Safran Passenger Innovation, supporting multi-orbit satellite connections including GEO, MEO, and LEO [3] - The system utilizes Ka-band spectrum (26.5 to 40 GHz) and employs a dual-dish antenna design named "Thinkom KA2517," which uses VICTS technology for optimal signal direction [3] Group 2: Benefits of HBCplus - Equipped aircraft will provide passengers with high-speed in-flight internet and enable real-time data connectivity between the cockpit and cabin, ensuring pilots receive updated flight plans and information [4] - The system allows airline operations to monitor flight status in real-time, enhancing operational efficiency [4] Group 3: Industry Adoption - Over 16 airlines globally have chosen HBCplus, with two already operating the system on their A350 aircraft [5]

Core Insights - China Southern Airlines Group achieved a record signing amount of over $2 billion at the 8th China International Import Expo, marking a six-year high, with agreements signed with 20 global aviation service providers from 9 countries [1][3] Group 1: Supply Chain Security - The group focused on enhancing international supply chain security and efficiency, securing multiple procurement collaborations in key areas such as technology equipment, service trade, and agricultural products [3] - The procurement agreements cover 4 major categories and 19 types of critical goods and services, involving 7 subsidiaries including the Engineering Technology Company and Zhuhai Motianyu Aviation Engine Maintenance Company [3] - These collaborations aim to strengthen the supply chain security, ensuring safe flight operations and improved passenger service quality [3] Group 2: Innovation in Cabin Products - China Southern Airlines is leveraging the expo as a platform to integrate global advanced manufacturing and trade resources, transitioning from equipment procurement to technology collaboration and co-creation of solutions [5] - The airline prioritizes passenger experience, working closely with over ten companies in the cabin industry to complete new cabin designs and key equipment customization [5] - This initiative aims to establish a core capability for providing customized cabin solutions, laying a solid foundation for creating world-class aircraft cabins [5] Group 3: Logistics and Service Enhancements - To address the concentrated cargo arrival pressure during the expo, China Southern Airlines Logistics deployed multiple Boeing 777F freighters, executing over 180 flights weekly [6] - The logistics team implemented a "green guarantee channel" for exhibition goods, enhancing the efficiency of the entire delivery process by over 30% [6] - The airline optimized the "airport-exhibition" short-haul link to ensure efficient entry of medical equipment and precision electronic products [6] Group 4: Comprehensive Service Support - During the expo, China Southern Airlines operated 34 round-trip routes from Shanghai Hongqiao and Pudong airports to 30 domestic and international cities, with an expected daily capacity of approximately 39,000 seats [8] - The airline increased flight frequencies to popular destinations and planned to operate the domestically produced C919 aircraft on the Shanghai-Hongqiao to Guangzhou route [8] - Special services were introduced, including themed flights with crew in traditional attire, priority luggage handling, and dedicated service counters at airports to enhance the travel experience for attendees [8]

Core Insights - Airbus and China Southern Airlines (CSA) signed an agreement during the China International Import Expo to equip 30 A350 aircraft with the next-generation in-flight connectivity system HBCplus, marking CSA as the first airline in China to adopt this system [1] Group 1: Agreement Details - The agreement includes retrofitting 20 existing aircraft and installing the system on 10 new aircraft [1] - The first aircraft equipped with the HBCplus system is expected to enter service in 2026 [1]

Core Insights - China Southern Airlines Group's trading delegation signed 23 import procurement agreements with 20 global aviation service manufacturers and suppliers from 9 countries, with a total signing amount exceeding 2 billion USD, marking a six-year high [1] Group 1 - The agreements were made during the 8th China International Import Expo [1] - The total signing amount of over 2 billion USD represents significant growth in procurement activities for the aviation sector [1] - This event highlights the increasing collaboration between Chinese airlines and international suppliers [1]

Core Viewpoint - The International Air Transport Association (IATA) will offer a Renminbi (RMB) settlement option to airlines and other suppliers starting in December, aimed at reducing exchange rate risks for airlines operating in China and facilitating local suppliers' participation, thereby lowering overall costs [1] Group 1 - IATA will implement RMB settlement through its clearing house for airlines and suppliers [1] - China Southern Airlines and Xiamen Airlines will be the first to pilot the RMB settlement option starting from November 2025 [1] - The new settlement option is expected to ease the currency risk faced by airlines operating in China [1]

Group 1 - As of November 5, 48 stocks reached their 52-week highs, with the top three being Eder Investment Holdings (06182) at 40.63%, LFG Investment Holdings (03938) at 11.70%, and Tianrui Automotive Interior (06162) at 11.11% [1] - Eder Investment Holdings closed at 0.900 and reached a high of 1.350, reflecting a significant increase [1] - LFG Investment Holdings and Tianrui Automotive Interior also showed notable increases in their stock prices, indicating positive market sentiment towards these companies [1] Group 2 - The report also highlights stocks that reached their 52-week lows, with XL South Strategy - U (4.034) showing the largest decline at -23.33% [2] - Other notable declines include Minglue Technology - W (197.900) at -21.01% and Zhihua Holdings (0.039) at -19.15%, indicating potential challenges faced by these companies [2] - The data suggests a mixed market environment, with some companies performing well while others struggle to maintain their stock prices [2] Group 3 - The report includes various stocks with minor declines, such as Capital World Financial (0.570) at -3.45% and Hu Shang Ayi (84.550) at -3.37%, reflecting a slight downward trend in certain sectors [3] - The overall performance of these stocks indicates a cautious market sentiment, with investors closely monitoring fluctuations [3] - The presence of both high-performing and underperforming stocks suggests a diverse investment landscape, requiring careful analysis for potential opportunities [3]