China Metals and Mining Equities Year of the snake: What to look for post CNY holiday? China Gold: Gold prices have recently soared to record highs with increasing central bank demand and rising trade tensions. We believe the near-term market environment will be positive for pure gold names like Zhaojin. The company's operation has been relatively unremarkable compared to that of its peers, with growth and profitability constrained by muted volume growth, but we think Zhaojin is different now. The outlook f ...

Summary of Haidilao International Holding Ltd Conference Call Company Overview - **Company**: Haidilao International Holding Ltd - **Industry**: China/Hong Kong Consumer - **Stock Ticker**: 6862.HK - **Market Cap**: Rmb75,467 million - **Current Share Price**: HK$14.90 - **Price Target**: HK$18.00, representing a 21% upside potential [5][9] Operational Updates - **Demand Trajectory**: Slightly better than expected but still weak; year-over-year (YOY) comparison for table turnover in February is higher than January due to Chinese New Year (CNY) timing [2][8] - **Earnings Growth**: Expected to be driven by margin improvements in the second half of 2024 and first quarter of 2025 [2] - **Cash Flow**: Disciplined investment and store openings are expected to generate solid cash flow, with a projected dividend yield of 5.5% based on 2023 dividends per share (DPS) [2] Financial Performance - **Revenue Projections**: - 2023: Rmb41,453 million - 2024e: Rmb44,382 million - 2025e: Rmb48,757 million - 2026e: Rmb51,552 million [5] - **Net Income Projections**: - 2023: Rmb4,499 million - 2024e: Rmb4,494 million - 2025e: Rmb5,555 million - 2026e: Rmb6,290 million [5] - **Earnings Per Share (EPS)**: - 2023: Rmb0.83 - 2024e: Rmb0.83 - 2025e: Rmb1.03 - 2026e: Rmb1.16 [5] Table Turn Trends - **January Performance**: Table turnover was slightly positive month-over-month and flat year-over-year; during the CNY holiday, turnover was down less than 5% compared to CNY 2024 [8] - **Store Network Changes**: - Haidilao: 8 gross openings and 10 closures, resulting in a net decrease of 2 stores - YEAH Qing BBQ: 14 new openings [8] Valuation and Risks - **Valuation Methodology**: Target price-to-earnings (P/E) ratio of 16x for 2025 estimated earnings, reflecting weaker consumption sentiment amid macro uncertainties [9] - **Growth Projections**: Projected 18% compound annual growth rate (CAGR) for EPS from 2024 to 2026 [9] - **Risks to Upside**: Faster macroeconomic recovery, better-than-expected demand recovery, and quicker new store openings [11] - **Risks to Downside**: Slower recovery in table turnover, raw material cost inflation, and delays in new store openings [11] Key Metrics - **P/E Ratios**: - 2023: 15.9 - 2024e: 18.0 - 2025e: 13.6 - 2026e: 12.0 [5] - **Return on Equity (ROE)**: - 2023: 60.4% - 2024e: 39.0% - 2025e: 34.7% - 2026e: 29.2% [5] - **Dividend Yield**: - 2024e: 5.0% - 2025e: 6.3% [5] Conclusion Haidilao International Holding Ltd is navigating a challenging demand environment but is positioned for potential growth through disciplined investment and operational strategies. The company's financial metrics indicate a cautious but optimistic outlook, with significant upside potential if macroeconomic conditions improve.

Summary of Conference Call on China Property Sector Industry Overview - The conference call focused on the **China Property** sector, specifically discussing trends observed during the **Chinese New Year (CNY)** holidays in 2025 [1][3]. Key Insights from Developers and Landlords - **State-Owned Enterprises (SOEs)** reported flattish year-over-year (Y/Y) growth in property sales, with variations from "mild Y/Y growth" to a decline in the mid-teens [1][3]. - **Private-Owned Enterprises (POEs)** predominantly experienced a Y/Y decline in sales, with some reporting declines of approximately **30-40%** [1][3]. - For **shopping malls**, landlords noted a mild Y/Y increase in both same-store tenant sales and footfall, with overall tenant sales surging by over **10% Y/Y** [1][3]. Sales Trends and Seasonal Factors - The **CNY period** is traditionally a low season for property sales, and January and February are influenced by project launches [3]. - The **China Index Academy** reported an **8% Y/Y growth** in "28-city primary property sales" during CNY, but this figure may not accurately reflect actual sales due to delays in sales registrations [3]. - Developers indicated that discounts and rebates are still necessary to enhance sell-through rates [3]. Future Outlook - The month of **March** is anticipated to provide a clearer picture of sales sustainability, as the impact of policy easing from September 2024 will have mostly faded, and data will be less affected by public holidays [3]. - The overall estimate for February primary sales is a low single-digit Y/Y decline, similar to January [3]. Performance of Key Companies - **Stock Preferences**: The report highlighted preferences for **China Resources Land** and **China Resources Mixc** as favorable investment options [1][3]. - The report also provided a valuation summary for various companies in the sector, indicating different ratings and price targets [5]. Additional Observations - Luxury retail continues to underperform compared to the mass market, indicating a shift in consumer spending patterns [3]. - The continuity of a moderate recovery in tenant sales during CNY suggests a positive outlook for proxies like **CR Mixc** [3]. Conclusion - The insights from developers and landlords during the CNY period indicate a mixed performance in the China Property sector, with SOEs faring better than POEs. The upcoming months will be crucial for assessing the sustainability of sales trends and the overall recovery of the sector.

5 February 2025 Equity Research Report China Film Industry Equities 2025 CNY box office hits a new high 2025 CNY box office hits a new high. Box office revenue rose to RMB9,510m during the 2025 Chinese New Year (CNY), up 19% from the 2024 CNY holiday and setting a new CNY box office record. This also beats our expectations. The number of attendances rose 15% y-o-y to 187 million, with average price up 3% y-o-y to RMB50.8. Films released during the holiday have earned good reputation thanks to their overall ...

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - The report highlights the continuous growth and development of China's internet industry, marking the 30th anniversary of full access to the international internet in 2024, which has significantly contributed to the integration of the digital economy with the real economy [4][15][27] - As of December 2024, the number of internet users in China reached 1.108 billion, with an internet penetration rate of 78.6%, reflecting a growth of 16.08 million users compared to December 2023 [13][64] - The report emphasizes the importance of internet infrastructure, including the expansion of 5G networks and broadband access, which supports the increasing demand for digital services [33][46][49] Summary by Sections Internet Infrastructure Development and Application Status - As of December 2024, China had 39.239 million IPv4 addresses and 69,148 blocks of IPv6 addresses, with 8.22 million active IPv6 users [34][38] - The total number of domain names reached 33.02 million, with ".CN" domains accounting for 20.82 million [44] - The number of 5G base stations reached 4.191 million, representing 33.2% of all mobile base stations, an increase of 4.1 percentage points from December 2023 [46] - The total number of internet broadband access ports reached 1.199 billion, with fiber optic access ports making up 96.5% of the total [49] - The total length of optical cable lines reached 71.83 million kilometers, showing significant growth [50] Internet User Scale and Structure - The total number of internet users in China reached 1.108 billion, with mobile internet users accounting for 1.105 billion, representing 99.7% of all internet users [13][64][66] - Rural internet users numbered 313 million, making up 28.2% of the total user base, while urban users accounted for 795 million [13] - The report indicates a growing digital literacy among users, with 47.4% of users aged 60 and above able to use mobile applications in senior mode [71] Internet Application Development Status - The report notes that as of December 2024, the number of social network users reached 1.101 billion, and instant messaging users reached 1.081 billion, indicating high engagement in digital communication [13] - The online shopping user base reached 974 million, with a growth of 5.947 million users from the previous year [13] - The report highlights the rapid growth of various online services, including online payment users at 1.029 billion and online government service users at 1.004 billion [13] Internet Governance Development Status - The report discusses the progress in establishing a legal framework for internet governance, including laws on cybersecurity, e-commerce, and data protection, which have been developed over the past 30 years [26]