Core Viewpoint - The A-share market is experiencing a rebound, with the oil and gas ETF Huatai-PineBridge (159309) showing a strong performance, gaining 1.72% and attracting over 6 million yuan in investment [1][3]. Group 1: Market Performance - The oil and gas ETF Huatai-PineBridge (159309) has seen most of its constituent stocks rise, with notable increases from companies such as Jereh Group and COSCO Shipping Energy, both exceeding 3% [3]. - As of 14:37, the top ten constituent stocks of the oil and gas ETF are listed, showcasing significant price changes and industry classifications [4]. Group 2: Geopolitical Factors - Recent geopolitical tensions are highlighted as a potential risk for oil production and exports, particularly concerning Iran's average monthly oil production of 3.26 million barrels per day for 2025 [5]. - The ongoing geopolitical uncertainties are expected to support oil price stability in the long term, as indicated by the analysis from Guangda Securities [5]. Group 3: Investment Logic - Four key investment logic points are identified for the oil sector: 1. Geopolitical conflicts may boost oil prices, with the Russian geopolitical outlook being a core factor influencing supply expectations [5]. 2. The commodity cycle suggests that the oil sector is worth monitoring during the current economic conditions, with a potential super cycle for commodities [5]. 3. The supply-demand dynamics are expected to improve, with historical low inventory levels and reduced capital expenditure in oil supply over the past decade [9]. 4. The oil sector offers high dividend advantages, with the oil and gas ETF Huatai-PineBridge (159309) showing a 12-month dividend yield of 3.83% and a payout ratio exceeding 50% for 2023-2024 [5][9]. Group 4: Long-term Value - The oil and gas sector is positioned as a long-term investment opportunity, with the ETF focusing on the oil and gas industry chain, highlighting its importance as a national pillar industry [5].

Investment Rating - The report maintains a "Positive" investment rating for the oil shipping sector [10]. Core Insights - Since the beginning of the year, VLCC freight rates have rebounded significantly due to the release of cargo and an increase in floating storage, leading to a tight supply-demand situation that drives up rates. The oil shipping industry is characterized as cyclical, with a focus on the marginal effects of industry cycle changes [2][5]. - Looking ahead to 2026, geopolitical fluctuations are expected to create "demand surprises," alongside a global crude oil production increase that will boost oil shipping demand and alleviate supply concerns. The U.S. crackdown on Venezuela's oil exports has led to a phase of compliance for Venezuelan oil exports, while increased geopolitical tensions in Iran also present bullish options [2][5]. - The report emphasizes the importance of the supply-demand balance, with a projected increase in oil tanker supply of 1.5% in 2025 and 4.0% in 2026, indicating that the combination of "demand surprises" and inventory replenishment will mitigate supply concerns. The report reaffirms recommendations for COSCO Shipping Energy and China Merchants Energy Shipping [2][5]. Summary by Sections Oil Shipping - VLCC freight rates have surged by 86.7% to $111,000 per day, driven by geopolitical developments and increased cargo availability. The sentiment among shipowners has improved significantly due to these factors [7][16]. - The report notes that the oil shipping sector is experiencing a recovery after a period of stagnation, with demand driven by increased oil production from South America and OPEC, as well as a rebound in Chinese imports [20][22]. - The compliance of Venezuelan oil exports is projected to increase oil shipping turnover by 1.3%, while Iranian compliance could lead to a 4.4% increase in demand [26][34]. Logistics and Transportation - The report highlights a decline in domestic and international passenger traffic due to the timing of the Spring Festival, with domestic passenger volume down 3% year-on-year [6][46]. - The logistics sector is facing challenges with a 5.7% year-on-year decline in express delivery volume, attributed to seasonal factors and changes in demand structure [8]. Market Dynamics - The report discusses the cyclical nature of the oil shipping industry, emphasizing the need to monitor geopolitical developments and production cycles that can significantly impact demand and supply dynamics [20][36]. - The anticipated increase in global crude oil inventories and the potential for a replenishment cycle are seen as critical factors that could drive demand for oil shipping in the near future [36][38].

Core Viewpoint - The oil and gas ETF Huatai Fuhua (159309) opened down by 1.69% at 1.220 yuan, reflecting a mixed performance among its major holdings [1] Group 1: ETF Performance - The performance benchmark for the oil and gas ETF Huatai Fuhua (159309) is the CSI Oil and Gas Resource Index return rate [1] - Since its establishment on May 31, 2024, the fund has achieved a return of 24.34%, with a monthly return of 11.03% [1] Group 2: Major Holdings Performance - Major holdings include: - Jereh Group opened up by 1.04% - China National Offshore Oil Corporation (CNOOC) down by 1.46% - China Petroleum down by 0.70% - China Petrochemical down by 0.34% - China Merchants Energy down by 2.02% - Guanghui Energy unchanged at 0.00% - COSCO Shipping Energy down by 2.03% - China Merchants South Oil down by 0.89% - CNOOC Engineering down by 1.30% - Intercontinental Oil and Gas down by 1.97% [1]

Group 1 - The core viewpoint is that the geopolitical landscape is shifting due to renewed U.S. sanctions on Iran and Venezuela, which could impact oil trade dynamics and increase demand for compliant oil transportation [1][2][3] - In the short term, if internal unrest in Iran escalates, oil trade demand may shift towards compliant supplies in the Middle East, equivalent to a demand for 38 VLCCs [1][3] - If the U.S. or Israel attacks Iran, the geopolitical risk premium for oil transportation may rise, further affecting the oil market [1][3] Group 2 - Venezuela's oil exports are currently constrained by U.S. military actions, which may push the oil trade towards compliance, representing a demand for 19 VLCCs in the short term [2] - If U.S. sanctions on Venezuela are lifted, the oil shipping demand could increase to 46 VLCCs, and with continued investment in infrastructure, exports could reach historical peaks of 240,000 barrels per day, equivalent to 141 VLCCs [2] - The shadow fleet established by Russia has allowed it to maintain oil exports despite sanctions, with potential impacts on 150,000 barrels per day of Russian oil exports if sanctions are intensified [4] Group 3 - The report suggests that companies such as China Merchants Energy Shipping Company (601872.SH), COSCO Shipping Energy Transportation (600026.SH), and China Merchants Jinling Shipyard (601975.SH) should be monitored for potential investment opportunities [5]

Group 1 - The oil sector is experiencing a capital inflow despite market conditions, with the Penghua Oil ETF (159697) seeing a net subscription of 10 million units, marking five consecutive days of net inflow [1] - Political tensions in Venezuela and Iran are increasing, contributing to a rise in regional political risk premiums for oil prices, while OPEC+ has decided to temporarily halt its production growth plan for the first quarter of 2026 [1] - As of January 15, 2026, the National Securities Oil and Gas Index (399439) shows mixed performance among its constituent stocks, with Hengtong Co. leading at a 3.61% increase, while Jiufeng Energy is down 4.45% [1] Group 2 - As of December 31, 2025, the top ten weighted stocks in the National Securities Oil and Gas Index (399439) include major companies such as China National Petroleum, Sinopec, and CNOOC, collectively accounting for 67.11% of the index [2]

Core Viewpoint - The shipping and port sector experienced a decline of 0.89% on January 14, with Xiamen Port leading the drop, while the Shanghai Composite Index closed at 4126.09, down 0.31%, and the Shenzhen Component Index rose 0.56% to 14248.6 [1]. Group 1: Market Performance - The shipping and port sector saw a significant drop, with Xiamen Port's stock closing at 13.45, down 3.45%, and a trading volume of 594,600 shares, resulting in a transaction value of 810 million yuan [2]. - Major stocks in the sector included Haitong Development, which rose by 4.47% to 12.61, and China Merchants South Oil, which increased by 2.15% to 3.33 [1][2]. - The overall trading volume in the shipping and port sector was notable, with a net outflow of 816 million yuan from main funds, while retail investors contributed a net inflow of 638 million yuan [2]. Group 2: Individual Stock Analysis - China Merchants Shipping saw a net inflow of 25.19 million yuan from main funds, despite a net outflow of 10.26 million yuan from retail investors [3]. - Saltian Port had a net inflow of 18.52 million yuan from main funds, with retail investors experiencing a net outflow of 21.26 million yuan [3]. - The stock of China Merchants South Oil had a net inflow of 5.13 million yuan from main funds, while retail investors faced a net outflow of 26.77 million yuan [3].

Investment Rating - The industry investment rating is "Positive" (maintained) [4] Core Viewpoints - The geopolitical changes are expected to usher in an "Oil Shipping Era" [3] - The U.S. military action against Venezuela may promote the compliance of Venezuelan oil trade, with short-term impacts limiting exports and shifting demand to compliant regions, equivalent to a demand for 19 VLCCs [4] - If U.S. sanctions on Venezuela are lifted, oil exports could reach 2.4 million barrels per day, requiring 141 VLCCs [4] - Iran's oil exports face dual pressures from domestic unrest and U.S. threats, with potential demand shifts to compliant markets equating to a need for 38 VLCCs [4] - Russia's oil exports are maintained through shadow fleets, with potential sanctions impacting 1.5 million barrels per day, equivalent to 36 VLCCs [4] - The new geopolitical landscape highlights the strategic value of oil shipping, with demand expected to improve in the short to medium term [4] Summary by Sections Geopolitical Impact on Oil Shipping - The geopolitical situation is reshaping global oil trade flows, expanding the compliant oil shipping market [4] - Short-term supply changes due to geopolitical conflicts may support shipping rates [4] - The dual logic of trade flow restructuring and compliance transformation is expected to drive demand in the oil shipping industry [4] Demand Projections - Venezuela: - Short-term demand shift due to transport restrictions: 19 VLCCs - Medium-term demand if sanctions are lifted: 46 VLCCs - Long-term potential peak exports: 141 VLCCs [4] - Iran: - Short-term demand shift due to unrest: 38 VLCCs - Long-term potential peak exports: 57 VLCCs [4] - Russia: - Potential sanctions impact: 36 VLCCs - If sanctions are lifted, demand could increase significantly [4]

Summary of Conference Call Notes Industry Overview - **Industry Focus**: Hong Kong/China Transportation and Infrastructure - **2026 Outlook**: More opportunities than risks, with a focus on supply-side opportunities in airlines, tanker shipping, and express delivery, while container shipping faces oversupply concerns [1][2][3] Airlines - **Pricing Trends**: Pricing inflation resumed since October 2025, supported by supply-side constraints and demand recovery from business travel, outbound travel growth, and inbound travel [2][11] - **Demand Drivers**: Business travel recovery positively correlated with capital expenditure, and inbound travel expected to grow, benefiting airlines [2][21] - **Airlines' Up-Cycle**: Chinese airlines are in a multi-year supply-driven up-cycle, with margin upside if pricing performance exceeds expectations [2][11] - **Key Stocks**: Overweight ratings on Air China (0753.HK), China Eastern Airlines (0670.HK), China Southern Airlines (1055.HK), and Spring Airlines (601021.SS) [9][10] Shipping - **Tanker Market**: Increasing demand for compliant tankers due to geopolitical tensions, with limited new supply additions due to low capital expenditure over the past decade [3] - **Container Shipping Risks**: Remains conservative on container shipping due to oversupply concerns [3] - **Key Stocks**: Overweight on COSCO Shipping (1138.HK) and China Merchants Energy Shipping (601872.SS), underweight on COSCO Shipping Holdings (1919.HK) and Orient Overseas (0316.HK) [3] Airports - **Bargaining Power**: Airports are regaining bargaining power through duty-free contract renewals, breaking monopoly dynamics, and increasing shareholdings in duty-free operators [4][54] - **Duty-Free Spending**: Expected upside in duty-free spending with expanded product categories and higher offline sales [4][58] - **Key Stocks**: Equal-weight ratings on Shanghai International Airport (600009.SS), Hainan Meilan Airport (0357.HK), and Guangzhou Baiyun International Airport (600004.SS), underweight on Beijing Capital International Airport (0694.HK) [53] Express Delivery - **Market Consolidation**: ZTO (ZTO.N) and YTO (600233.SS) are consolidating market share, leading to cost-efficiency gains and margin expansion [5] - **International Expansion**: J&T (1519.HK) expected to consolidate market share in overseas markets through e-commerce partnerships [5] Key Risks and Considerations - **Airlines**: Risks include faster-than-expected aircraft delivery, deterioration in travel demand, unfavorable RMB depreciation, and surging oil prices [52][51] - **Airports**: Continued underperformance in duty-free business due to weak consumption and competition from other channels [54][55] Conclusion - The transportation sector in Hong Kong/China is poised for growth in 2026, driven by supply-side opportunities in airlines and shipping, while airports are regaining power in duty-free operations. However, risks remain, particularly in container shipping and overall economic conditions.

Group 1: Share Buybacks and Increases - Prolo Pharmaceutical's controlling shareholder plans to increase its stake by 60 million to 120 million yuan [3] - BAIC Blue Valley and some directors and executives plan to increase their holdings by 14.5 million to 16.4 million yuan [3] - Zhongju High-tech has obtained a commitment letter for a stock repurchase loan of 540 million yuan from a financial institution [3] - Haojiang Intelligent plans to use its own funds to repurchase shares for equity incentives or employee stock ownership plans [3] - Huazhi Jie intends to repurchase shares worth 30 million to 50 million yuan [3] - Nanshan Aluminum plans to repurchase shares worth 300 million to 600 million yuan for cancellation [3] Group 2: Share Reductions - New Work Group, a shareholder of Zhongxin Group, plans to reduce its stake by no more than 3% [3] - Hongqi Technology's shareholders plan to reduce their holdings by no more than 4.68% [3] - Zhejiang Yongqiang's shareholder, Xie Jianqiang, plans to reduce his stake by no more than 1.13% [3] - Xiangyu Medical's shareholder, Anyang Qixu, plans to reduce his stake by no more than 3% [3] - Shuyuan Pingmin's shareholder, Ali Health, plans to reduce his stake by no more than 2% [3] - Hongqiang Co., Ltd.'s actual controller plans to reduce no more than 2.1161 million shares, not exceeding 1% of the total share capital [3] - China Merchants Shipping's directors and executives plan to collectively reduce their holdings by no more than 648,600 shares [3] - Zhang Yijie, a shareholder of Jixin Technology, plans to reduce his stake by no more than 1% [3] - Dingjie Smart's major shareholder, Industrial Fulian, reduced its stake by 1.14% from January 9 to January 12 [3] - Zhongli Co., Ltd.'s shareholders plan to reduce their holdings by no more than 0.75% [3]

Group 1 - The company, China Merchants Energy Shipping Company, announced that as of the date of the announcement, its directors and senior management collectively hold approximately 2.59 million shares, accounting for 0.032131% of the total share capital [1] - Four directors and senior management members plan to reduce their holdings by a total of no more than approximately 650,000 shares within three months after the announcement, which represents no more than 0.008033% of the total share capital [1] - Each individual plans to reduce their holdings by no more than 25% of their total personal shareholdings, with the reduction price to be determined based on the market price at the time of the reduction [1] Group 2 - The industry is experiencing challenges with rising raw material costs, such as silver, leading to difficult decision-making for companies [1] - Some companies in the solar energy sector are rushing to export products before the April 1 deadline, indicating a competitive market environment [1]