Investment Rating - The investment rating for the company is "Buy" [3][28]. Core Insights - The company's Q2 2024 revenue and profit were below market expectations, but game performance met predictions. Q2 revenue was 25.5 billion RMB, a year-on-year increase of 6%, with game and value-added services growing by 7% and 10% respectively. Adjusted net profit was 7.8 billion RMB, down 13% year-on-year, primarily due to changes in non-operating income, while adjusted operating profit increased by 18% [1][2]. - The target price has been adjusted from $117 to $113, reflecting a 37.4% potential upside from the current price of $82.25. The company expects a recovery in PC games in Q3, while mobile games face short-term growth pressure due to high base effects [2][28]. Financial Summary - For Q2 2024, the company reported a net income of 25.5 billion RMB, with a gross profit margin of 63%. The adjusted operating profit margin was 32%, indicating a stable operational performance despite the revenue dip [5][15]. - The forecast for 2024 includes a revenue adjustment of 1.7% and a profit adjustment of 1.3%, with the gaming business expected to maintain stable operational potential after digesting high base impacts [2][11].

交银国际研究 公司更新 | --- | --- | --- | |------------|-------------|----------| | 收盘价 | 目标价 | 潜在涨幅 | | 港元 92.85 | 港元 120.00 | +29.2% | 云音乐 (9899 HK) 上半年利润超预期，核心音乐会员业务维持稳健 2024 上半年利润超预期。2024 上半年云音乐收入 40.7 亿元（人民币，下 同），同/环比增4%/3%，主要受音乐业务拉动，基本符合我们/市场预期。 剔除版权成本一次性调整影响，毛利率同/环比扩 8/4 个百分点，受益于在 线音乐规模效应、自制增加以及社交收入分成比例收窄。经调整净利润 8.8 亿元，好于市场预期的 6.2 亿元，主要因费用优化好于预期。 音乐业务维持稳健增长，持续聚焦规模扩张及用户体验优化：1）会员订 阅收入同比增25%，公司不再披露MAU、会员等运营数据，但分享将通过 增加差异化内容供给及升级产品/会员功能发力用户和会员规模增长，预 计人均付费（ARPPU）或相对持稳。2）非会员收入同比增 33%，主要受 广告拉动，激励广告开始贡献收入增量。 展望：我们预计 2 ...

Investment Rating - Maintains a **Buy** rating for Simcere Pharmaceutical (2096 HK) with a target price of HKD 10.00, implying a potential upside of 90.9% [1] Core Views - **1H24 Performance**: Adjusted net profit grew by 36% YoY, driven by gross margin recovery (+3.3ppts) and reduced R&D expense ratio (-4.8ppts) [1] - **Revenue Recovery**: Expected 2024-26 revenue CAGR of 14%, supported by stable sales of Xianbixin and rapid market penetration of new products [1] - **New Product Launches**: Key products like Xianbixin (sublingual tablet), Cosela, and Suvaximab are expected to drive growth, with combined peak sales potential exceeding RMB 8.5 billion [1] Financial Performance - **1H24 Revenue**: Declined by 7.9% YoY, with innovative drug revenue down 8.7%, accounting for 70.7% of total revenue [1] - **Gross Margin**: Improved to 78.8% in 2024E, up 0.3ppts from previous forecasts, with further improvement expected to 79.8% by 2026E [4] - **Adjusted Net Profit**: Forecasted to grow at a CAGR of 21% from 2024-26, reaching RMB 1.37 billion by 2026E [1][4] Product Pipeline and Market Potential - **Xianbixin**: Sales expected to stabilize, with sublingual tablet launch expanding treatment scenarios and maintaining a peak sales target of RMB 5.5 billion [1] - **Cosela**: Potential inclusion in NRDL by end of 2024 could drive annual sales to exceed RMB 500 million [1] - **New Launches**: Suvaximab and Daliresib expected to contribute over RMB 3 billion in peak sales within the next 18 months [1] Valuation and Forecasts - **DCF Valuation**: Target price revised to HKD 10.00 based on updated financial forecasts, reflecting a 91% upside potential [1] - **Free Cash Flow**: Expected to grow from RMB 750 million in 2025E to RMB 1.83 billion by 2033E, driven by operational leverage and cost efficiency [5] Industry Comparison - **Biotech Sector**: Simcere Pharmaceutical is part of a broader biotech sector with strong growth potential, as evidenced by similar buy ratings for peers like Legend Biotech (LEGN US) and BeiGene (6160 HK) [6]

Investment Rating - The report maintains a "Buy" rating for the company with a target price adjusted from $5.00 to $4.50, indicating a potential upside of 34.3% from the current price of $3.35 [1][4][10]. Core Insights - The company is focusing on high school education and AI subscription services, with hardware revenue expected to recover in Q3 2024. The growth rate for high school business has been revised down from 25-30% to 20-25% for 2024 [1]. - The second quarter of 2024 saw a revenue increase of 9.5% year-on-year to 1.3 billion RMB, with learning services, hardware, and advertising revenues showing varied performance [1]. - The company reported an adjusted net loss of 96 million RMB in Q2 2024, which was better than market expectations [1]. Financial Performance Summary - Revenue projections for 2024 have been slightly adjusted, with an expected overall revenue growth of 12%. Learning services and hardware revenues are projected to decline by 3% and 9% respectively, while advertising revenue is expected to grow by 62% [1][11]. - The company achieved a gross profit margin of 48.3% in 2024, with a slight improvement from previous estimates [3][11]. - The adjusted net profit margin is projected to be -0.4% for 2024, indicating ongoing challenges but potential for recovery in subsequent years [3][11]. Revenue Breakdown - Learning services revenue is expected to be 3.05 billion RMB in 2024, down from previous estimates [3]. - Hardware revenue is projected to recover to 832 million RMB in 2024, with a growth rate of 11% [3]. - Advertising revenue is forecasted to reach 2.16 billion RMB, reflecting a growth rate of 7.7% [3]. Market Position - The company has a market capitalization of approximately $104.62 million, with a 52-week high of $4.65 and a low of $3.05 [4][10]. - The company has maintained a strong retention rate of over 70% for its digital content services, indicating robust customer loyalty [1].

Investment Rating - The report maintains a neutral rating for WuXi Biologics (2269 HK) with a target price of HKD 12.30, indicating a potential upside of 18.3% from the current closing price of HKD 10.40 [1][2][6]. Core Views - The company's 1H24 performance met expectations, with revenue growth of 1.0% year-on-year, excluding COVID-related revenue, which reflects a growth of 7.7%. However, the adjusted net profit decreased by 20.7% due to high base effects from 1H23 and increased SG&A expenses [1][2]. - The report highlights that the short-term uncertainties in the industry and external environment remain significant risks, leading to a downward revision of the earnings forecast for 2024-2026 by 4-19% [1][2]. - The company expects to receive approximately RMB 500 million in large payments in 2H24, which is anticipated to improve operational efficiency and revenue growth in the latter half of the year [1][2]. Financial Summary - Revenue projections for 2024E are set at RMB 17,989 million, with a decrease of 0.8% from previous estimates. For 2025E and 2026E, revenues are projected at RMB 20,710 million and RMB 23,701 million, reflecting decreases of 9.0% and 8.3% respectively [2][7]. - The adjusted net profit for 2024E is forecasted at RMB 5,019 million, down 3.6% from prior estimates, with further declines of 18.6% and 17.5% for 2025E and 2026E [2][7]. - The gross profit margin is expected to decline to 39.1% in 2024E, down from 41.6% in the previous forecast, indicating a decrease of 2.5 percentage points [2][7]. Order and Capacity Utilization - In 1H24, the company secured 61 new orders, with a strong momentum in late-stage projects, including 9 "winning molecule" projects. The company anticipates signing additional contracts by the end of the year [1][2]. - The report notes that the capacity utilization rate is expected to improve steadily, particularly with the ramp-up of production in Ireland, which is projected to break even by 1H25 and achieve an 80% utilization rate by 2026 [1][2].

Investment Rating - The report maintains a "Buy" rating for Weichai Power (2338 HK) with a target price of HKD 18.60, indicating a potential upside of 52.2% from the current price of HKD 12.22 [1][2][6]. Core Insights - Weichai Power's performance in the first half of 2024 showed revenue of RMB 112.49 billion, a year-on-year increase of 6.0%, and a net profit attributable to shareholders of RMB 5.903 billion, up 51.4% year-on-year. The growth in net profit outpaced revenue growth due to improved gross margins and effective cost control [1][4]. - The company experienced a significant increase in the sales of natural gas heavy-duty truck engines, with a year-on-year growth of 92.5%, capturing a market share of 63.1% in this segment. This trend is expected to continue due to stricter environmental regulations and increased subsidies for vehicle replacements [1][2]. - The report highlights that Weichai Power's diversified business model and international expansion contribute to a high certainty of continued profitability improvement in the second half of 2024 [2][4]. Financial Overview - For the fiscal year ending December 31, 2024, Weichai Power is projected to achieve revenue of RMB 235.46 billion, representing a year-on-year growth of 10.1%. The net profit is expected to reach RMB 11.84 billion, with a significant increase in earnings per share to RMB 1.38 [4][7]. - The company's gross margin improved to 21.7%, an increase of 3 percentage points year-on-year, while the combined sales, management, and R&D expenses accounted for 13.8% of revenue, remaining stable compared to the previous year [1][4]. - The interim cash dividend payout ratio increased to 55%, up from 50.6% in 2023, reflecting the company's strong cash flow position [1][4]. Market Position - Weichai Power holds a leading position in the heavy-duty truck engine market, with a market share of 40.5%, bolstered by its dominance in the natural gas engine segment [1][2]. - The report notes that the stock price has adjusted following the resignation of the chairman, presenting an attractive valuation opportunity for investors [2][6].

Investment Rating - The investment rating for the company is "Buy" with a target price of $3.80, indicating a potential upside of 46.2% from the current price of $2.60 [1][17]. Core Insights - The company's membership revenue is under short-term pressure, leading to a downward adjustment of the full-year revenue and profit expectations [1]. - The second quarter performance met expectations, with total revenue of 7.4 billion RMB, a decrease of 5% year-on-year and 6% quarter-on-quarter, primarily due to a high base from the previous year and weaker performance in key content [2][3]. - Adjusted net profit for the second quarter was 250 million RMB, consistent with expectations, resulting in an adjusted net profit margin of 3% [1][2]. Financial Overview - Total revenue for 2022 was 28,998 million RMB, increasing to 31,873 million RMB in 2023, with a projected revenue of 30,319 million RMB for 2024, reflecting a year-on-year decline of 4.9% [3]. - The adjusted net profit for 2024 is expected to be 1,617 million RMB, with a significant decrease from the previous year [3]. - The company’s earnings per share (EPS) for 2024 is projected at 1.65 RMB, down from 2.91 RMB in 2023 [3]. Membership and Advertising Revenue - Membership revenue in the second quarter decreased by 9% year-on-year to 4.5 billion RMB, while the average revenue per member (ARM) continued to show a growth trend [2][3]. - Advertising revenue for the second quarter was 1.5 billion RMB, a slight decline of 2% year-on-year, but performance in effect advertising remained positive [2][3]. Future Outlook - For the third quarter, despite improvements in key drama viewership data, membership revenue is expected to decline by 13% year-on-year, with a potential recovery in the fourth quarter as new content is released [2][3]. - The company has adjusted its revenue expectations for 2024 and 2025, reflecting ongoing uncertainties in content strategy execution and short-term performance adjustments [2][3].

Investment Rating - The report maintains a "Buy" rating for the company, China Ping An Insurance (2318 HK), with a target price of HKD 51.00, indicating a potential upside of 48.7% from the current closing price of HKD 34.30 [1][3][23]. Core Insights - The company's major business indicators are performing well, and its valuation appears low, prompting a reaffirmation of the "Buy" rating. The individual insurance agents have stabilized and shown a slight recovery, with a total of 340,000 agents, a 2% decrease year-to-date but a 0.7 thousand increase quarter-on-quarter, marking the first quarter-on-quarter increase since Q3 2020 [1][3]. - The new business value for the first half of the year grew by 11% year-on-year, aligning with expectations. The new business value margin increased to 24.2%, up 6.5 percentage points year-on-year, driven by product structure optimization and extended payment terms [2][3]. - The strategic layout of comprehensive finance and medical pension services has created a differentiated competitive advantage, with an upgrade to the 2.0 customer management phase. The profit forecast for 2024 has been raised, expecting a 13% year-on-year growth in OPAT from a low base [3][15]. Financial Performance Summary - For the first half of 2023, the company reported a net profit attributable to shareholders of RMB 69.841 billion, a 6.8% increase year-on-year, while OPAT slightly decreased by 0.6% to RMB 78.950 billion. The core business segments showed growth, with property insurance up 7.2%, life and health insurance up 0.7%, and banking up 1.9% [6][15]. - The new business value for the first half of 2023 was RMB 20.112 billion, with a year-on-year growth of 11%. The number of individual insurance agents decreased by 9.1% year-on-year [6][7]. - The company expects a net profit of RMB 111.464 billion for 2024, reflecting a 30.1% year-on-year increase, with an operating ROAE of 12.0% [19][24].

Investment Rating - The report maintains a **Buy** rating for China Power (2380 HK) with a target price of HKD 4.56, implying a potential upside of 27.4% from the current price of HKD 3.58 [1][2] Core Views - **Strong H2 Profit Growth**: The company is expected to deliver robust profit growth in the second half of the year, driven by significant improvements in the hydro power segment and a special dividend announcement [1] - **Hydro Power Recovery**: Hydro power operating profit surged 5.3x YoY to RMB 1.35 billion in H1 2024, exceeding expectations by 25%, due to improved water conditions [1] - **Wind and Solar Growth**: Despite a decline in utilization hours for wind (-8%) and solar (-4%) in H1, operating profits for wind and solar increased by 35% and 63% respectively, supported by new capacity additions [1] - **Coal Power Margin Expansion**: The coal power segment saw a 44% YoY increase in operating profit, driven by a higher spark spread (RMB 0.118/kWh vs. RMB 0.105/kWh in H1 2023) due to lower coal costs [1] - **Special Dividend**: A special dividend of RMB 0.05 per share was announced to celebrate the company's 20th anniversary of listing in Hong Kong [1] Financial Performance and Forecasts - **H1 2024 Earnings**: Net profit rose 53% YoY to RMB 2.57 billion, slightly above expectations by 2% [1] - **2024/25 Profit Growth**: Profit growth is forecasted at 69% and 39% for 2024 and 2025 respectively, despite downward revisions of 2.5% and 6.0% due to lower wind and solar utilization hours [2] - **Dividend Yield**: The company's dividend yield for 2024/25 is expected to exceed 7%, with a payout ratio of 65% or higher, including the special dividend [2] Capacity and Generation Outlook - **Hydro Power**: Hydro utilization hours are expected to remain at historically high levels, with a 10% upward revision in hydro generation forecast for 2024, leading to a 57% YoY increase in hydro power output [1] - **Wind and Solar**: The company maintains its 2024 target of adding 3GW of wind and 4GW of solar capacity, despite a 5% and 2% downward revision in wind and solar generation forecasts due to lower wind speeds and solar irradiance [1] - **Total Capacity**: By 2026, the company's total installed capacity is projected to reach 67,019 MW, with renewable energy accounting for 83.5% of the total [7] Valuation - **Sum-of-the-Parts Valuation**: The target price of HKD 4.56 is derived from a sum-of-the-parts valuation, with hydro, wind, and solar segments valued at 0.75x, 8.5x, and 8.5x 2025E P/B and P/E multiples respectively [8] Industry Comparison - **Peer Comparison**: Among covered companies in the renewable energy sector, China Power (2380 HK) has a 27.4% potential upside, compared to peers like Huadian Power (836 HK) with 23.5% and Longyuan Power (916 HK) with 37.2% [9]

Investment Rating - The report maintains a "Buy" rating for China National Heavy Duty Truck Group Co., Ltd. (3808 HK) with a target price of HKD 26.49, indicating a potential upside of 28.9% from the current closing price of HKD 20.55 [2][6]. Core Insights - The company reported a robust performance in the first half of 2024, with revenue increasing by 18.0% year-on-year to RMB 4.88 billion and net profit rising by 39.8% to RMB 3.29 billion, aligning with market expectations [2]. - The market share of China National Heavy Duty Truck in the heavy truck segment improved significantly, reaching 27.6%, up 1.1 percentage points year-on-year, driven by strong demand for natural gas heavy trucks [2][5]. - The company has initiated a mid-term dividend plan, distributing RMB 0.66 per share, with a payout ratio of 55%, an increase from previous years [2][3]. Financial Performance Summary - Revenue for 2024 is projected to reach RMB 101.7 billion, with a year-on-year growth of 19.0% [3][7]. - Net profit is expected to grow to RMB 6.44 billion in 2024, reflecting a 21.0% increase compared to 2023 [3][7]. - The gross margin is forecasted to stabilize around 16.9% in 2024, with operating profit margin improving to 7.9% [7]. Market Position and Strategy - The company is positioned to benefit from the heavy truck replacement demand, particularly in the natural gas segment, which saw a remarkable 273% increase in sales year-on-year [2][5]. - The report emphasizes the attractiveness of the company's valuation and the potential for further dividend increases in the future [2][3].