M N 11 Mar 2024 CMB International Global Markets | Equity Research | Company Update ZTE (000063 CH) Improved margins in 2023 Target Price RMB34.20 ZTE released its FY23 results. Revenue grew by 1.1% YoY to RMB124bn, in line with consensus and 3% higher than our forecast. Net profit increased by 15.4% (Previous TP RMB36.90) YoY to RMB9.3bn, 5% lower than consensus and in line with our forecasts. Gross Up/Downside 13.3% margin for 2023 was 41.5%, representing a 434bps increase from FY22. NPM Current Price RMB ...

2024 年 3 月 11 日 招银国际环球市场 | 宏观研究 | 宏观视角 就业温和降温，联储 6 月可能降息 叶丙南, Ph.D (852) 3761 8967 yebingnan@cmbi.com.hk 刘泽晖 (852) 3761 8957 frankliu@cmbi.com.hk 资料来源：Wind, 招银国际环球市场 资料来源：Wind, 招银国际环球市场 (1,000) (800) (600) (400) (200) 0 200 400 600 800 201320142015201620172018201920202021202220232024 政府 服务 商品 月均新增就业(千人) 敬请参阅尾页之免责声明 请到彭博 (搜索代码: RESP CMBR )或 http:// www.cmbi.com.hk 下载更多招银国际环球市场研究报 告 2024 年 3 月 11 日 图 1: 劳动力人数和非农就业人数 资料来源：Wind，招银国际环球市场 130 135 140 145 150 155 160 165 170 175 2017 2018 2019 2020 2021 2022 2023 ...

Investment Rating - The report maintains a BUY rating on Prada SpA, indicating a potential return of over 15% over the next 12 months [2][16]. Core Insights - Prada's 4Q23 net revenue grew by approximately 18.1% year-over-year, driven by a remarkable 82% growth in the Miu Miu brand, surpassing expectations [2]. - The company reported strong growth across all regions, particularly in Japan (cFX +38%) and APAC (cFX +32%), while the US showed sequential improvement [2]. - Management confirmed positive sales momentum has continued into 2024, with expectations of sustained growth despite challenging market conditions [2]. - Prada plans to implement routine price hikes of 4-8% in 2024, focusing on clothing and leather goods, which is expected to support long-term margin expansion [2]. - The closure of outlet stores is progressing, with this segment contributing only about 10% to overall sales, set to be phased out in the next 2-3 years [2]. Financial Summary - Revenue is projected to grow from EUR 4,726 million in FY23A to EUR 5,091 million in FY24E, reflecting a year-over-year growth of 7.7% [3]. - Net profit is expected to increase from EUR 671 million in FY23A to EUR 739 million in FY24E, with a year-over-year growth of 10.1% [3]. - The report indicates a gross margin of 80.8% for FY24E, with EBIT margin projected at 22.9% [8]. - The target price for Prada is set at HK$65.2, representing a 17.1% upside from the current price of HK$55.7 [4]. Earnings Revisions - The earnings estimates for 2024E have been revised to reflect a revenue increase to EUR 5,091 million, up from EUR 5,008 million previously [7]. - Gross profit estimates for 2024E have been adjusted to EUR 4,113 million, indicating a 2.0% increase from prior estimates [7]. - Net profit for 2024E is now projected at EUR 739 million, a slight increase from the previous estimate of EUR 732 million [7].

Investment Rating - Maintain BUY rating with an adjusted target price of HK$24.8, based on 10x 2024E P/E, close to its 3-year average [3][4] Core View - ZTE is expected to capitalize on emerging trends in the telecom industry, focusing on the evolution towards 5.5G/6G and AI compute power [3] - The company's profitability improved steadily due to operation optimization and cost reduction, including the use of self-developed components [3] - Revenue growth is projected to be steady, with FY24E revenue expected to reach RMB133.7bn, a 7.6% YoY increase [1][3] Financial Performance - FY23 revenue grew by 1.1% YoY to RMB124.3bn, in line with consensus and 3% higher than forecasts [3] - FY23 net profit increased by 15.4% YoY to RMB9.3bn, 5% lower than consensus but in line with forecasts [3] - Gross margin for FY23 was 41.5%, a 434bps increase from FY22, driven by cost optimization and favorable revenue mix [3] - FY24E net profit is projected to grow by 16.3% YoY to RMB10.8bn, with a net margin of 8.1% [1][3] Segment Performance - Carrier segment revenue increased by 3.4% YoY, driven by domestic market share gains and overseas progress [3] - Consumer segment sales declined by 1.3% YoY due to overseas inventory digestion and intensified competition, partially offset by domestic growth in family network business [3] - Enterprise & government segment sales declined by 7.1% YoY in 2023 due to a slowdown in investment [3] Valuation Metrics - FY24E P/E is projected at 7.3x, with ROE expected to reach 14.3% [1] - FY25E P/E is projected at 6.5x, with ROE expected to reach 14.5% [1] Market Data - Current price is HK$17.92, with an upside potential of 38.4% to the target price of HK$24.8 [4] - Market capitalization is HK$13.5bn, with an average 3-month turnover of HK$162mn [5]

Investment Rating - Maintain HOLD rating for NIO Inc (NIO US) with a revised target price of US$6 20, down from US$6 80 [2] Core Views - NIO's cash burn has accelerated despite the capital injection from CYVN, and the company shows no clear strategy to achieve profitability [2] - The company's 4Q23 earnings missed expectations, particularly in other income and SG&A expenses, with an operating loss of RMB6 6bn, RMB1 9bn higher than projected [2] - Management's FY24E gross profit margin (GPM) guidance of 15-18% is considered overly optimistic, especially given the failure to achieve 15% GPM in 3Q23 and 4Q23 [2] - Even with a 15% vehicle GPM and disciplined R&D and SG&A spending, NIO's FY24E net loss is expected to exceed RMB10bn, far from profitability [2] Financial Performance - 4Q23 revenue and gross profit from vehicles were in line with forecasts, but vehicle GPM of 11 9% missed the guidance of 15% [2] - Gross margin for other revenue was -34%, below the projected -25%, indicating that the elimination of service benefits is impacting margins more than expected [2] - R&D and SG&A expenses in 4Q23 were RMB720mn higher than estimates, contributing to the larger-than-expected operating loss [2] - FY24E sales volume forecast has been cut from 0 21mn units to 0 19mn units due to delayed deliveries of the second brand Alps [2] Earnings and Valuation - FY24E net loss revised from RMB14 7bn to RMB17 2bn, reflecting higher-than-expected costs and lower margins [2] - Target price cut to US$6 20 based on 1 4x revised FY24E revenue estimates, compared to Li Auto's 1 3x FY24E P/S [2] - NIO's profitability remains significantly weaker than peers like Li Auto, which trades at a lower P/S multiple [2] Quarterly Results - 4Q23 sales volume was 50,045 units, down 9 7% QoQ but up 25 0% YoY [7] - Overall ASP in 4Q23 was RMB341,756, down 0 6% QoQ and 14 8% YoY [7] - Gross margin improved to 7 5% in 4Q23, up 3 6ppt YoY but down 0 5ppt QoQ [7] - Operating margin was -38 7% in 4Q23, a decline of 13 3ppt QoQ [7] Financial Summary - FY23E revenue is projected at RMB55,618mn, with a gross margin of 5 5% [9] - FY24E revenue is expected to grow 17 3% to RMB65,239mn, with a gross margin of 8 1% [9] - FY24E operating profit is forecast at a loss of RMB18,814mn, improving from FY23E's loss of RMB22,655mn [9] - Net profit for FY24E is projected at a loss of RMB17,170mn, slightly better than FY23E's loss of RMB21,147mn [9] Cash Flow and Balance Sheet - FY23E net cash from operations is expected to be negative at RMB1,872mn, worsening to RMB10,446mn in FY24E [10] - Cash and equivalents are projected to decline from RMB32,935mn in FY23E to RMB22,783mn in FY24E [9] - Total liabilities are expected to decrease slightly from RMB87,787mn in FY23E to RMB74,228mn in FY24E [9] Growth and Profitability - FY24E revenue growth is forecast at 17 3%, with gross profit growth of 72 8% [10] - Operating margin is expected to improve from -40 7% in FY23E to -28 8% in FY24E [10] - Adjusted net profit margin is projected to improve from -33 2% in FY23E to -23 4% in FY24E [10]

M N 6 Mar 2024 CMB International Global Markets | Equity Research | Company Update Yuexiu Transport (1052 HK) 2023 core profit +91% YoY but below estimates; >7% yield + potential asset injection Target Price HK$7.20 Yuexiu Transport’s net profit in 2023 grew 69% YoY to RMB765mn. Adjusted (Previous TP HK$7.50) for RMB100mn of non-cash impairment on Shantou Bay Bridge, the core net Up/Downside 57.2% profit would be RMB865mn (+91% YoY), 10%/8% below our/consensus Current Price HK$4.58 forecast as the gross mar ...

敬请参阅尾页之免责声明 2 图 12: 全球制造业 PMI 资料来源：Wind，招银国际环球市场 30 35 40 45 50 55 60 65 70 75 80 2015201620172018201920202021202220232024 全球制造业新订单 全球制造业投入价格 全球制造业产出价格 (指数) 招银国际环球市场投资评级 资料来源：Wind，招银国际环球市场 2024 年 3 月 6 日 招银国际环球市场有限公司 重要披露 本报告内所提及的任何投资都可能涉及相当大的风险。报告所载数据可能不适合所有投资者。招银国际环球市场不提供任何针对个人的投资建议。本报告没有把任何人的 投资目标、财务状况和特殊需求考虑进去。而过去的表现亦不代表未来的表现，实际情况可能和报告中所载的大不相同。本报告中所提及的投资价值或回报存在不确定性 及难以保证，并可能会受目标资产表现以及其他市场因素影响。招银国际环球市场建议投资者应该独立评估投资和策略，并鼓励投资者咨询专业财务顾问以便作出投资决 定。 本报告包含的任何信息由招银国际环球市场编写，仅为本公司及其关联机构的特定客户和其他专业人士提供的参考数据。报告中的信息或所表 ...

M N 1 Mar 2024 CMB International Global Markets | Equity Research | Company Update Salesforce (CRM US) 4Q results in-line; eye on AI development Target Price US$350.00 Salesforce reported 4QFY24 financial results: total revenue was up 10.8% YoY (Previous TP US$329.30) to US$9.29bn, in line with consensus estimate of US$9.22bn. FY24 total revenue Up/Downside 16.8% was up 11.2% YoY to US$34.9bn. Non-GAAP operating income grew by 19.3% Current Price US$299.77 YoY to US$2.92bn in 4QFY24, also in line with conse ...

29 Feb 2024 Earnings Summary CMB International Global Markets | Equity Research | Company Update iQIYI (IQ US) Improving profitability with solid guidance iQIYI (IQ) delivered better-than-feared 4Q23 results with inline topline and upbeat margin. Looking into 1Q24E, we expect both revenue and earnings to see sequential growth, with solid ARM trend. We keep confident on IQ's previous FY24E OP target (at RMB5bn), with disciplined content cost and ARM expansion. Given already-low expectation and clear profitab ...

M N 1 Mar 2024 CMB International Global Markets | Equity Research | Company Update Budweiser APAC (1876 HK) 4Q23 a slight miss; S. Korea undershoot Target Price HK$14.5 Stripping off mainly the US$66mn tax provision, Bud APAC 4Q results came in (Previous TP HK$16.9) c.3%/6% below us/consensus. Operations in South Korea (esp. home channel) Up/Downside 14.2% looked increasingly challenging upon the return of Japanese brands, with Current Price HK$12.7 volume consecutively edging down by MSD% since 3Q23 (1H23: ...