Employment Data - In November 2024, the U.S. non-farm payrolls increased by 227,000, exceeding the market expectation of 200,000, with the previous month's figure revised from 12,000 to 36,000[1] - The unemployment rate rose to 4.2%, matching expectations, while the labor force participation rate fell to 62.5%, below the expected 67.7% and October's 62.6%[1] - Average hourly earnings year-on-year growth remained at 4.0%, above the expected 3.9%, with a month-on-month increase of 0.4%, surpassing the expected 0.3%[1] Market Reactions - Despite the strong non-farm payrolls data, the market chose to overlook it due to mixed signals from the data, particularly the continued weakness in household survey results[2] - The probability of a 25 basis point rate cut in December rose to 89% from 73.3% prior to the data release, reflecting market sentiment towards the weakening household survey data driving the Fed's decision[4] - Following the non-farm employment data release, U.S. stocks rose, and bond yields fell, indicating a market response favoring rate cuts[4] Structural Employment Insights - The goods sector saw a rebound with 22,000 jobs added in manufacturing, primarily due to the end of the Boeing strike, while the service sector added 162,000 jobs, including a recovery of 53,000 in leisure and hospitality[2] - The household survey indicated a decline in the labor force population by 193,000, continuing a trend from the previous month, with the unemployment population increasing by 160,000, pushing the unemployment rate to 4.25%[3] - Wage growth remains resilient, with average hourly earnings showing stability, which may support consumer spending but could limit further inflation reduction[3]

Industry Rating - The report assigns a **Leading** rating to the pharmaceutical industry, indicating that the industry is expected to outperform the benchmark index over the next 12 months [1] Core Views - The national centralized procurement of traditional Chinese medicine (TCM) decoction pieces and proprietary Chinese medicines has officially started, covering 45 and 95 varieties respectively, with key factors for selection being a price reduction of over 20% and a price difference of 1.2 times [1][3] - The 27-province alliance for medical consumables procurement has announced results, with an 85% selection rate and an average price reduction of 70% [1][4] - The pharmaceutical sector has shown slight recovery after significant fluctuations, with potential for further recovery due to low valuations and expected favorable fiscal and medical insurance policies [1] Sector Performance - The Hang Seng Index rose 1.0% while the Hang Seng Healthcare Index rose 0.3%, underperforming the broader market [1][13] - Sub-sector performance: Life Science Tools & Services (+5.8%), Healthcare Equipment & Supplies (+2.8%), Biotech (+1.4%), Healthcare Providers & Services (+1.1%), Healthcare Technology (+0.5%), Pharmaceuticals (+0.2%) [1][13] Key Company Developments - **Akeso Biopharma**: Positive results from a Phase Ib/II study of cadonilimab in PD-(L)1 resistant NSCLC, showing a 6-month PFS rate of 56.9% and median PFS of 6.5 months [5] - **Simcere Pharmaceutical**: Approval of Xianbixin® sublingual tablets for acute ischemic stroke, offering improved bioavailability [6] - **CSPC Pharmaceutical**: CRB-701 (SYS6002) granted Fast Track designation by the FDA for metastatic cervical cancer [8] - **Hengrui Medicine**: Two innovative drugs, fluzoparib and apatinib, approved for new indications in HER2-negative breast cancer [9] - **Innovent Biologics/Hutchmed**: Tyvyt® (sintilimab) combined with Elunate® (fruquintinib) conditionally approved for advanced endometrial cancer [10] - **Merck/Kelun-Biotech**: Sacituzumab tirumotecan (Sac-TMT) granted Breakthrough Therapy Designation by the FDA for EGFR-mutated NSCLC [11] Valuation Overview - The healthcare sector's TTM P/E ratios: Pharmaceuticals (11.2x), Life Science Tools & Services (15.2x), Biotech (21.3x), Healthcare Equipment & Supplies (12.3x), Healthcare Providers & Services (11.4x), Healthcare Technology (23.4x) [21] Top Stock Performers - **Cloudbreak Pharma**: +32.1% [13] - **CanSino Biologics**: +16.0% [13] - **WuXi Biologics**: +12.1% [13] Key Investment Recommendations - Focus on innovative drug companies with strong short-term catalysts and high growth potential, such as Akeso Biopharma, Legend Biotech, and Everest Medicines [1] - Pay attention to leading prescription drug companies with potential for both earnings growth and valuation multiple expansion, such as Simcere Pharmaceutical and Sino Biopharmaceutical [1] - Consider consumer-oriented private medical services and medical aesthetics companies, as well as pharmaceutical distribution companies with high dividend yields [1]

Investment Rating - The report maintains a **Buy** rating for New World Development (17 HK) with a target price of HKD 11.44, representing a potential upside of **74.5%** from the current price of HKD 6.56 [1][3] Core Views - New management is expected to improve operational efficiency, particularly in the mainland China business, with the appointment of Ms. Wong Siu Mui as CEO [1] - The company has completed the sale of NEW WORLD SPORTS DEVELOPMENT LIMITED (NWSPL) for HKD 416.7 million, which is expected to help recover investment costs and reduce financial burdens [2] - Sales progress is strong, with HKD 3.7 billion in attributable sales completed in Hong Kong (62% of FY2025 guidance) and RMB 4.8 billion in contracted sales in mainland China, with expectations to reach RMB 7 billion by the end of 2024 (64% of full-year guidance) [2] - The stock is currently trading at around **0.1x P/B**, which is believed to reflect most negative factors, with potential re-rating catalysts including improved operational efficiency, strong FY2025 sales progress, reduced capex, and potential interest rate cuts [3] Financial Summary - Revenue is expected to decline by **34.4% YoY** in FY2024 to HKD 35,782 million but rebound by **20.2% YoY** in FY2025 to HKD 42,999 million [4] - Core profit is projected to decrease by **47.5% YoY** in FY2024 to HKD 1,377 million but recover by **19.8% YoY** in FY2025 to HKD 1,648 million [4] - The company's P/E ratio is expected to improve from **12.0x** in FY2024 to **10.0x** in FY2025 [4] - Dividend yield is forecasted to increase from **3.0%** in FY2024 to **4.0%** in FY2025 [4] Operational Highlights - The company has established separate operating committees for Hong Kong and mainland China businesses to enhance operational efficiency [1] - The launch of Guangzhou Kaixuan New World is expected to contribute to mainland China sales, with contracted sales projected to reach RMB 7 billion by the end of 2024 [2] Industry Context - The report covers other Hong Kong and mainland China real estate companies, including Sun Hung Kai Properties (16 HK), Link REIT (823 HK), and Henderson Land (12 HK), with varying ratings and target prices [8]

Investment Rating - The report assigns a "Buy" rating to the company with a target price of HKD 56.20, indicating a potential upside of 21.1% from the current price of HKD 46.40 [1][11]. Core Insights - The successful inclusion of the drug "耐赋康" (EVER001) in the national medical insurance directory is expected to drive significant sales growth, with projected sales reaching RMB 12.2 billion and RMB 18.3 billion for 2025 and 2026, respectively [2]. - The report highlights the promising clinical results of EVER001, a reversible BTK inhibitor, which has shown high rates of clinical remission in patients with membranous nephropathy, a condition with increasing prevalence [1][2]. - The market potential for EVER001 is substantial, as it is the only drug approved for the IgA nephropathy indication in the national medical insurance directory, providing a significant first-mover advantage [2]. Financial Projections - Revenue projections for the company have been revised upwards, with expected revenues of RMB 744 million for 2024, RMB 1.765 billion for 2025, and RMB 2.951 billion for 2026, reflecting increases of 17.4% and 15.3% for the latter two years compared to previous forecasts [3][13]. - The net profit forecast for 2026 has been adjusted to RMB 409 million, a significant improvement from previous estimates [3][13]. - The gross profit margin is expected to improve to 79.0% by 2026, indicating enhanced operational efficiency [3][13]. Market Context - The report notes that the incidence of membranous nephropathy is rising, with approximately 2 million patients in China and significant numbers in the US, Europe, and Japan, highlighting the growing market opportunity for the company's products [1][2]. - The company is positioned in the biotechnology sector, which is experiencing robust growth, particularly in the development of innovative therapies for unmet medical needs [11].

| --- | --- | |-------------------------|------------------------------| | 交银国际研究 \n消息快报 | | | 科技 | 2024 年 12 月 3 日 | | | | | 科技行业 | | | | | 美加大对华半导体行业出口限制和实体清单和我们的思考 12 月 2 日，美国商务部属下的工业和安全局（BIS）宣布修订了新的《出 口管理条例》，旨在进一步限制中国在人工智能和高端半导体领域的发展 。根据 BIS 的公告，新规定涵盖了对 24 种半导体制造设备和 3 种半导体开 发 生 产 软 件 工 具 （ EDA ） 的 新 管 制 措 施 ； 对 高 带 宽 存 储 器 （ High Bandwidth Memory，HBM）的新管制；以及针对合规和转移问题提出新的 "红旗警告"。与此同时，BIS 还在实体清单中新增了 140 个条目，并进了 14 项修改，涉及 100+家设备制造商、24 家半导体晶圆厂和实验室等， 以 及两家投资公司。 对于主要设备厂商供应影响有限。对于这次增加实体清单中占主体的半导 体设备商，我们整理了半导体 ...

Investment Rating - The report assigns a "Buy" rating to the following companies: Ningde Times (Target Price: 310.10 CNY), Yiwei Lithium Energy (Target Price: 56.51 CNY), Guoxuan High-Tech (Target Price: 29.07 CNY), Zhongxin Innovation (Target Price: 15.59 HKD) and a "Neutral" rating for Ruipu Lanjun (Target Price: 14.25 HKD) [4][5]. Core Insights - The battery industry is at a turning point with valuation returning to a reasonable range and low-altitude economy policies catalyzing a rebound in market sentiment. The current TTM P/E ratio of the Wande Lithium Battery Index is 34 times, rebounding nearly 40% from the low in September 2024, approaching the three-year historical average [3][11]. - The report highlights the advantages of LFP technology and supply chain, positioning Chinese companies to target global markets. It anticipates a global battery demand CAGR of 14% from 2024 to 2026, with strong demand expected to continue [3][29]. - The report emphasizes the significant "Matthew Effect" in the battery industry, where leading companies like Ningde Times are expected to maintain their profitability and competitive edge due to scale and technological advantages [4][45]. Summary by Sections Investment Logic - The report suggests that now is a good time to buy, as industry valuations have returned to reasonable levels and investment sentiment is improving. The demand for electric vehicles and energy storage is expected to drive growth [10][11]. Market Demand - The global electric vehicle market is projected to grow by 27% year-on-year in 2024, while energy storage is expected to see a CAGR of 28% from 2024 to 2026, becoming a significant new growth driver for the battery industry [7][28]. Technology and Innovation - The report identifies opportunities in technological iterations, including hybrid batteries and solid-state batteries. Short-term focus is on fast charging and hybrid/incremental technologies, while solid-state batteries are seen as a revolutionary long-term technology [3][4][10]. Company Analysis - Key companies analyzed include Ningde Times, Yiwei Lithium Energy, Guoxuan High-Tech, Zhongxin Innovation, and Ruipu Lanjun, with a focus on their technological and cost advantages, as well as their market positioning [4][5][29]. Global Market Position - Chinese battery companies are gaining a significant share in the global market, with 86% of the global energy storage battery market and a 64% share of the global power battery market in 2023. The report emphasizes the importance of technological layout and cost advantages in maintaining this leadership [29][30][31].

Investment Rating - The report maintains a **Neutral** rating for China Gas (384 HK) with a target price of HKD 5.92, representing a potential downside of 8.1% from the current price of HKD 6.44 [1][3] Core Views - China Gas' 1H FY25 earnings declined by 3.8% YoY to HKD 1.76 billion, missing market expectations by approximately 15% due to losses from joint ventures, higher taxes, and increased minority interests [1] - Retail gas sales volume grew by only 1.9% YoY in 1H FY25, dragged down by weak industrial gas demand, which grew by only 1% YoY [2] - The company's gas sales gross margin improved by RMB 0.02 per cubic meter to RMB 0.59, driven by residential gas price adjustments in 32 cities [2] - New residential connections declined by 14% YoY in 1H FY25 due to reduced rural coal-to-gas conversions and weak property sales [2] - The report downgrades FY25-27 earnings forecasts by 13-19%, reflecting slower industrial gas growth and reduced new residential connections [2] - Management expects the spin-off of value-added services to the US market to provide a second growth driver, but the timeline remains unclear [2] Financial Performance Summary - Revenue is expected to decline by 6.8% YoY in FY25 to HKD 75.9 billion, followed by a gradual recovery with 2.7% and 2.9% growth in FY26 and FY27, respectively [4] - Net profit is forecasted to grow by 18.8% YoY in FY25 to HKD 3.78 billion, with further growth of 6.7% and 5.7% in FY26 and FY27, respectively [4] - EPS is expected to decline by 4.6% YoY in FY25 to HKD 0.70, with subsequent growth of 6.7% and 5.7% in FY26 and FY27, respectively [4] - The company's P/E ratio is projected to increase from 8.8x in FY24 to 9.3x in FY25, before declining to 8.7x and 8.2x in FY26 and FY27, respectively [4] - Dividend yield is expected to remain stable at 5.4% from FY25 to FY27, with a maintained dividend payout of HKD 0.35 per share [4] Operational Data and Forecasts - Total retail gas sales volume is expected to grow by 2.2% YoY in FY25 to 24.04 billion cubic meters, with growth slowing to 2.5% and 2.7% in FY26 and FY27, respectively [8] - Residential gas sales volume is forecasted to grow by 0.5% YoY in FY25 to 8.97 billion cubic meters, while industrial gas sales are expected to decline by 3.3% YoY to 14.65 billion cubic meters [8] - The gas sales gross margin is projected to remain stable at RMB 0.53 per cubic meter from FY25 to FY27 [8] - New residential connections are expected to decline by 5.2% YoY in FY25 to 1.27 million households, with further declines of 4.6% and 7.6% in FY26 and FY27, respectively [8] Valuation and Peer Comparison - China Gas is trading at a discount to its peers, with a FY25E P/E of 9.3x compared to the sector average of 12.0x [9] - The company's FY25E P/B ratio of 0.63x is below the sector average of 1.0x [9] - Among peers, China Gas has the lowest potential upside of -8.1%, compared to 27.4% for Kunlun Energy (135 HK) and 24.6% for ENN Energy (2688 HK) [13]

Investment Rating - The report maintains a "Buy" rating for Meituan (3690 HK) with a target price adjusted to HKD 226.00, indicating a potential upside of 35.0% from the current closing price of HKD 167.40 [1][4]. Core Insights - Meituan's Q3 2024 performance was strong, with revenue reaching RMB 93.6 billion, a year-on-year increase of 22%, surpassing consensus expectations. Adjusted net profit grew by 124% year-on-year, with a net profit margin of 14%, up 6.2 percentage points from the previous year [1][3]. - The core business and new initiatives showed growth, with core business revenue increasing by 20% and new business revenue by 29% [1][2]. - The report projects revenue growth rates of 22% for 2024 and 15% for 2025, with core business revenue expected to grow by 21% and 17% respectively [3][12]. Financial Performance Summary - Q3 2024 revenue was RMB 936 billion, with a net profit margin of 14% and an adjusted operating profit margin of 21% [1][6]. - The report estimates that Meituan's revenue for 2024 will be RMB 337.2 billion, with a year-on-year growth of 21.8% [5][12]. - The adjusted net profit for 2024 is projected to be RMB 44.7 billion, reflecting an 85.9% increase year-on-year [5][12]. Business Segment Performance - The food delivery segment saw a year-on-year growth in revenue, driven by improved advertising monetization and reduced user subsidies [2][3]. - Flash purchase orders increased by nearly 35% year-on-year, with significant growth in user numbers and transaction frequency [2][3]. - The hotel and travel segment experienced a 50%+ increase in order volume, with GTV and revenue growth around 25% [2][3]. Valuation and Market Position - The report maintains previous valuation expectations, forecasting a net profit growth of approximately 25% for 2025, corresponding to a PEG ratio of 0.9 [3][12]. - Meituan's long-term competitive advantages include accumulated industry experience, strong traffic, and brand reputation [3][12].

Investment Rating - The report upgrades the investment rating of the company to "Buy" with a target price of HKD 24.00, indicating a potential upside of 26.8% from the current closing price of HKD 18.92 [1][3][4]. Core Insights - The sales momentum for the drug Amelot is strong, with three major indications expected to be approved within a year. The company anticipates that these approvals will drive annual sales growth of over 20% from 2024 to 2025, reaching a sales target of RMB 6 billion by 2026 [1][2]. - The company is expected to benefit from compliance investigations affecting competitors, which may allow it to capture market share in first-line and second-line treatments [2]. - The company has a robust pipeline with several new products and indications expected to launch between 2025 and 2026, including an oral antifungal drug and multiple oncology products, supported by a cash reserve exceeding RMB 21 billion [2][3]. Financial Summary - Revenue projections for the company are as follows: RMB 12,704 million for 2024, RMB 13,334 million for 2025, and RMB 14,854 million for 2026, reflecting growth rates of 25.7%, 5.0%, and 11.4% respectively [5][11]. - Net profit estimates are RMB 4,364 million for 2024, RMB 4,052 million for 2025, and RMB 4,754 million for 2026, with corresponding growth rates of 32.9%, -7.1%, and 17.3% [5][11]. - The company’s earnings per share (EPS) are projected to be RMB 0.74 for 2024, RMB 0.68 for 2025, and RMB 0.80 for 2026, with a price-to-earnings (P/E) ratio of 23.9 for 2024 and 25.8 for 2025 [5][11].

Investment Rating - The report maintains a **Buy** rating for Budweiser APAC (1876 HK) with a target price of HKD 9.39, representing a potential upside of 27.3% [1][4] Core Views - Short-term performance is pressured by challenges in the China market, but the company's long-term competitive strength remains intact [1] - The company's premium/super-premium product portfolio in China is expected to rebound as consumer spending recovers [1] - In Korea, the company has enhanced its competitiveness through increased investment and new product launches, with an 8.1% price increase on premium/super-premium products expected to boost profitability in 2025 [1] Regional Performance Asia Pacific West (China, India, Vietnam) - China market: Q3 2024 volume declined by 14.2%, average selling price (ASP) fell by 2.1%, leading to a 16.1% revenue drop [2] - India market: Continued strong growth with double-digit increases in premium/super-premium products, which account for 2/3 of India's revenue [2] - Overall APAC West: Volume and ASP declined by 13.5% and 1.9% respectively in Q3 2024 [2] Asia Pacific East (Korea, Japan, New Zealand) - Korea market: Revenue grew by mid-teens in Q3 2024, driven by mid-single-digit volume growth and product mix optimization [2] - Overall APAC East: Volume and ASP increased by 3.9% and 11.4% respectively in Q3 2024 [2] Financial Performance - Q3 2024 revenue: USD 1.705 billion, down 9.4% YoY [3] - Q3 2024 normalized EBITDA: USD 479 million, down 16.6% YoY [3] - Q3 2024 net profit: Down 25.0% YoY [3] - 9M 2024 revenue: USD 5.104 billion, down 6.1% YoY [3] - 9M 2024 normalized EBITDA: USD 1.579 billion, down 6.2% YoY [3] - 9M 2024 net profit: USD 777 million, down 11.6% YoY [3] Financial Forecasts - 2024E revenue: USD 6.531 billion, down 4.7% YoY [7] - 2025E revenue: USD 6.740 billion, up 3.2% YoY [7] - 2026E revenue: USD 7.000 billion, up 3.9% YoY [7] - 2024E net profit: USD 751 million, down 11.7% YoY [7] - 2025E net profit: USD 830 million, up 10.5% YoY [7] - 2026E net profit: USD 924 million, up 11.3% YoY [7] Valuation Metrics - 2025E P/E: 19x (down from 22x average for 2024-25) [1] - 2024E P/E: 16.6x [7] - 2025E P/E: 15.0x [7] - 2026E P/E: 13.5x [7] Market Position - The company continues to gain market share in Korea through expansion in both on-premise and off-premise channels [2] - New product launches (e.g., Cass, HANMAC) in Korea have received positive market feedback [2]