Investment Rating - The report maintains a BUY rating on BeOne Medicines with a target price of US$392.43, indicating a potential upside of 23.8% from the current price of US$316.99 [1][2]. Core Insights - BeOne Medicines achieved its first full-year profitability in FY25, driven by strong sales of its BTK inhibitor, Zanubrutinib (Zanu), which generated US$3.93 billion in sales, reflecting a 49% year-over-year increase [1][8]. - The company has provided FY26 revenue guidance of US$6.2–6.4 billion, which is slightly below previous estimates of US$6.6 billion, but the outlook remains positive due to Zanu's expanding market share and multiple upcoming clinical and regulatory catalysts [1][8]. - Zanu has captured approximately 50% of new patient prescriptions in the US for both first-line and relapsed/refractory chronic lymphocytic leukemia (CLL), positioning it as the leading BTK inhibitor globally [8]. Financial Summary - For FY24A, FY25A, and FY26E, BeOne's revenue is projected to be US$3.81 billion, US$5.34 billion, and US$6.32 billion, respectively, with net profits expected to turn positive in FY25A at US$286.9 million and further increase to US$684.5 million in FY26E [2][21]. - The company’s gross profit margin is expected to improve from 87.5% in FY25A to 87.6% in FY26E, while the net profit margin is projected to rise from 5.4% in FY25A to 10.8% in FY26E [22]. Market Performance - BeOne's market capitalization stands at approximately US$37.57 billion, with a 52-week high of US$377.47 and a low of US$206.32 [3]. - The stock has experienced a decline of 5.7% over the past month and 6.9% over the past three months, but has shown a positive trend with a 5.6% increase over the last six months [5]. Shareholding Structure - Major shareholders include Amgen with a 16.9% stake and Baker Bros with 7.9% [4].

Investment Rating - The report maintains a "BUY" rating for Baidu, with a target price adjusted to US$161.7 from the previous US$150.7, indicating a potential upside of 29.9% from the current price of US$124.44 [2][14]. Core Insights - Baidu's General Business revenue for 4Q25 was RMB26.1 billion, down 5.7% year-over-year, aligning with Bloomberg consensus, while non-GAAP operating profit reached RMB2.8 billion, down 39% year-over-year but 12% above consensus [1]. - AI-powered business segments showed significant growth, with AI-native marketing services revenue increasing by 110% year-over-year to RMB2.7 billion, and AI-cloud infrastructure revenue reaching RMB5.8 billion, with subscription-based revenue growing 143% year-over-year [1][8]. - The report highlights key stock price drivers, including the reacceleration of overall advertising revenue growth, robust cloud revenue growth, and enhancements in shareholder returns, particularly through a new share repurchase program and the introduction of a dividend policy [1][15]. Financial Performance - For FY25, Baidu's revenue is projected at RMB129.1 billion, reflecting a 3.0% decline year-over-year, with adjusted net profit expected to be RMB18.9 billion, down 29.9% year-over-year [9]. - The non-GAAP operating profit margin for Baidu Core was 10.9% in 4Q25, showing a recovery from 9.0% in 3Q25, indicating improvements in operational efficiency [8]. - The revenue from AI Cloud Infrastructure for 2025 is expected to reach RMB19.8 billion, up 34% year-over-year, showcasing strong growth in this segment [8]. Valuation and Forecast - The report rolls over the valuation window to 2026E, with a target price based on a sum-of-the-parts (SOTP) valuation method, which includes various business segments and net cash [14]. - The adjusted target price reflects a valuation of US$35.7 for Baidu General Business, US$62.9 for Baidu Cloud, and US$62.8 for net cash and investments [14]. - The forecast for 2026E revenue is RMB135.0 billion, with a gross profit margin of 43.7% and a non-GAAP net profit margin of 12.9% [12][19].

Report Industry Investment Rating - No relevant information provided Core Viewpoints - The new TOHOKU 31 tightened 5bps from RO at T+70, while the new NTT Float 31 and OCBCSP 36 hovered around ROs. The secondary Chinese IG space overall closed unchanged. There were balanced flows on TMT names, better buying in CCAMCL FRNs and front - end ORIEAS, and better selling on FRESHK 27 - 29s. EHICAR 26 dropped 0.5pt, while EHICAR 27 closed unchanged. In HK, sentiment on HK property gradually recovered, with some bonds gaining and others losing. In Chinese properties, some bonds gained and some lost. In KR space, new issues widened, and long - end bonds traded wider. JP insurance subs and Yankee AT1s remained stable. In SE Asian space, MEDCIJ 27 was down, and some bonds rose. In the Middle East, PBs were selling long - end KSA/ARAMCO, and global RMs were buying 2 - 5yr FABUHs. The LGFV space closed largely unchanged [2] - The new SUMITR Float 29s tightened 10bps from RO at SOFR+71, and SUMITR Float 31s tightened 17 - 18bps from RO at SOFR+89. Fixed - rate SUMITR new issues had different performances, and Asia IG space were 2 - 4bps wider. INCLEN/INGPHL/RPVIN had solid 3QFY26 earnings and were on track to FY26 guidance. YLLGSP's FY25 results stabilized with narrowing losses, a rebound in gross margin, and a healthy gearing ratio, and YLLGSP 26 was unchanged [3] - ReNew Energy (RNW)'s credit profile is underpinned by robust operating cash inflows and scalable advantages. INCLEN 4.5 04/18/27 is preferred within the ReNew Energy complex, and a buy is maintained on it despite less compelling valuation. RNW benefits from diversification and resilient cash flow generation, with revenue and adj. EBITDA increasing and loss before tax narrowing in 3QFY26 and 9MFY26. It is on track to meet FY26 guidance, and is pivoting to a more solar - heavy portfolio, which is credit positive. Leverage is expected to decline, and it early redeemed a bond and has refinancing risk for some outstanding bonds [7][10][13][14] Summary by Directory Trading Desk Comments - New issuance: TOHOKU 31 tightened 5bps from RO at T+70; NTT Float 31 and OCBCSP 36 hovered around ROs [2] - Secondary Chinese IG space: Overall closed unchanged, with balanced flows on TMT names, better buying in CCAMCL FRNs and front - end ORIEAS, and better selling on FRESHK 27 - 29s [2] - EHICAR: EHICAR 26 dropped 0.5pt, EHICAR 27 closed unchanged [2] - HK property: Sentiment gradually recovered, NWDEVL/VDNWDL Perps gained 0.1 - 1.3pts, HYSAN 4.85 Perp edged 0.6pt higher, MTRC 5.625 Perp/LASUDE 26 were 0.1pt higher, FAEACO 12.814 Perp lost 0.4pt [2] - Chinese properties: FUTLAN 28/FTLNHD 26 - 27 gained up to 0.6pt, new FTLNHD 29 was priced at 97.095 and YTM 13%, VNKRLE 27 - 29 lost 0.5pt, LNGFOR 27 - 32 were 0.1pt lower to 0.3pt higher [2] - KR space: New issues DAESEC 29 - 31 widened 1bp, long - end EIBKOR/LGENSO/POHANG traded 1 - 3bps wider [2] - JP insurance subs and Yankee AT1s: Remained stable with flows largely from retail accounts [2] - SE Asian space: MEDCIJ 27 was down by 0.3pt, rest of MEDCIJ 26 - 30s were unchanged to 0.1pt higher, ACPM Perps rose 0.9 - 1.3pts, ACNRGY 5.1 Perp gained 1.4pts [2] - Middle East: PBs were selling long - end KSA/ARAMCO, global RMs were buying 2 - 5yr FABUHs [2] - LGFV space: Closed largely unchanged amid moderate two - way flows [2] Analyst Comments - INCLEN/INGPHL/RPVIN: Had solid 3QFY26 earnings and were on track to FY26 guidance [3][7] - YLLGSP: FY25 results stabilized with narrowing losses, gross margin rebounded to 27.4% in FY25 from 9.4% in FY24, and gearing ratio was 43.6%. YLLGSP 26 was unchanged [3] - ReNew Energy (RNW): Credit profile is underpinned by robust operating cash inflows and scalable advantages. INCLEN 4.5 04/18/27 is preferred. In 3QFY26, revenue rose 36% yoy to INR25.1bn, adj. EBITDA increased 54% yoy to INR21.4bn, and loss before tax narrowed by 83% yoy to INR505mn. In 9MFY26, revenue rose 48% yoy to INR100.4bn, adj. EBITDA increased 31% yoy to INR74.8bn, and profit before tax up 83% yoy to INR12.8bn. It is on track to meet FY26 guidance, is pivoting to a more solar - heavy portfolio, and leverage is expected to decline. It early redeemed USD525mn RNW 7.95 07/28/26 and has refinancing risk for some outstanding bonds [7][10][13][14] Macro News Recap - S&P (-0.54%), Dow (+0.03%) and Nasdaq (-1.18%) were mixed on Thursday. US latest initial jobless claims were +212k, lower than the market expectation of +217k. UST yield was lower on Thursday, with 2/5/10/30 year yield at 3.42%/3.57%/4.02%/4.67% [6] Offshore Asia New Issues Priced | Issuer/Guarantor | Size (USD mn) | Tenor | Coupon | Priced | Issue Rating (M/S/F) | | --- | --- | --- | --- | --- | --- | | Emirate of Abu Dhabi | 1250/1750 | 5yr/10yr | 3.75%/4.25% | T+20/T+25 | -/AA/AA | | New Metro Global | 355 | 3yr | 11.8% | 13.0% | -/B - /- | | Qatar Islamic Bank | 750/500/750 | 5yr/3yr/3yr | 4.402%/3.95%/SOFR+71 | T+80/T+53/SOFR+71 | -/-/A | | Sumitomo Mitsui Trust | 500/750/500 | 5yr/5yr/10yr | 4.20%/SOFR+89/4.8% | T+65/SOFR+89/T+80 | A1/A/- | [20] Pipeline - No Offshore Asia New Issues Pipeline Today [21] News and Market Color - Onshore primary issuances: 76 credit bonds were issued yesterday with an amount of RMB53bn. Month - to - date, 1,041 credit bonds were issued with a total amount of RMB795bn raised, representing a 27.2% yoy decrease [22] - ARAMCO: Canceled some liquefied petroleum gas deliveries after damage to a delivery system at its Juaymah facility [22] - CKHH: Agreed to sell 100% of UK Power Networks Holdings to France's Engie for cUSD14.2bn [22] - CTFSHK: 1HFY26 adjusted EBITDA rose 0.97% yoy to HKD3.6bn (cUSD459mn) [22] - DALWAN: Sold Changzhou Xinbei Wanda Plaza Investment [22] - FOSUNI: Fosun pharma business to issue corporate bonds for up to RMB6bn (cUSD872.7mn) [22] - KDB: Will review the privatisation of Korean shipping firm HMM after the shipper's relocation to Busan is completed [22] - IIFOIN: Plans to raise USD500 - 750mn via external commercial borrowings and USD social bonds in Mar'26 [22] - NIO: Certain Chinese investors will infuse RMB2.3bn (cUSD329mn) in its subsidiary, GeniTech, by subscribing to its shares [22] - PTTGC: Estimated its capex for the 2026 - 2030 period totaled USD553mn [29] - TAISEM: Net revenue up 32% in FY25 to TWD3.8tn (cUSD121.6bn) [29]

Group 1: Semiconductor Industry - Nvidia reported Q4 FY2026 revenue of $68 billion, a 73% year-over-year increase and a 20% quarter-over-quarter increase, exceeding Bloomberg consensus by 2.6% [2] - The company's EPS was $1.62, up 82% year-over-year and 25% quarter-over-quarter, also surpassing Bloomberg consensus by 5% [2] - Nvidia's gross profit margin improved to 75.2% from 73.6% in the previous quarter, exceeding the consensus estimate of 74.3% [2] - Management guided for Q1 FY2027 revenue of $78 billion, indicating a sequential increase of approximately $10 billion, with gross margins expected to remain around 75% [2] - The strong demand for computing power from large cloud providers, emerging cloud, sovereign AI, and enterprise sectors was emphasized by management [2] Group 2: Company Ratings - Zhongji Xuchuang and Shengyi Technology are maintained with a "Buy" rating, expected to benefit directly from Nvidia's sustained demand momentum and platform upgrade cycle [3] - iQIYI reported Q4 FY2025 revenue of RMB 6.79 billion, a 3% year-over-year increase, aligning with Bloomberg consensus [6] - Ctrip's Q4 FY2025 revenue reached RMB 15.4 billion, a 20.8% year-over-year increase, exceeding Bloomberg consensus by 4% [7] - Salesforce's Q4 FY2026 revenue grew 12% year-over-year to $11.2 billion, meeting Bloomberg consensus expectations [7] - BOE Technology Group is projected to have 2025 revenue of HKD 14.533 billion, an 8% year-over-year increase, despite a forecasted decline in net profit [8]

Investment Rating - The report maintains a "BUY" rating for iQIYI, indicating a potential return of over 15% over the next 12 months [17]. Core Insights - iQIYI's total revenue for 4Q25 grew by 3% YoY to RMB6.79 billion, aligning with Bloomberg consensus estimates. The non-GAAP net income was RMB110 million, a significant improvement from a net loss of RMB59 million in 4Q24, exceeding the consensus estimate of RMB68 million [1]. - The forecast for total revenue in 1Q26 is expected to decline by 13% YoY and 8% QoQ to RMB6.28 billion due to adjustments in content strategy and reduced content distribution to other channels, leading to a decrease in content distribution revenue [1]. - The target price for iQIYI has been lowered to US$2.00, based on an 18x multiple of the 2026E non-GAAP EPS, down from a previous target of US$2.75 [1][12]. Financial Performance Summary - For FY26E, total revenue is projected at RMB26.9 billion, reflecting a decline of 1.4% YoY, with adjusted net profit expected to be RMB750.7 million [2]. - The gross margin is anticipated to improve to 22.1% in FY26E, while the non-GAAP operating margin is expected to decline to -0.8% in 1Q26E due to operating deleverage [10]. - Membership services revenue in 4Q25 was RMB4.1 billion, remaining stable YoY after seven consecutive quarters of decline, attributed to improved content performance [9]. Market Position and Competitive Landscape - iQIYI ranked first in viewership market share in the 2025 Enlightent Data TV series annual ranking, supported by five titles that exceeded a popularity score of 10,000 [9]. - The company has made progress in emerging businesses, with overseas membership revenue growing over 40% YoY in 2H25 and the launch of its first iQiyi Land in February 2026 [9]. Valuation Metrics - The current market capitalization of iQIYI is approximately US$1.648 billion, with a current price of US$1.71, indicating a 17% upside to the target price [3][4]. - The average P/S ratio is maintained at 0.4x across the forecast period [2].

Investment Rating - The report maintains a "BUY" rating for Trip.com Group (TCOM) with a target price of US$83.00, indicating a potential upside of 58.8% from the current price of US$52.27 [3][16]. Core Insights - Trip.com Group reported total revenue of RMB15.4 billion for 4Q25, representing a year-over-year increase of 20.8%, which exceeded Bloomberg consensus estimates by 4% [1]. - The company demonstrated resilience in travel demand, with significant growth in corporate travel, package tours, and other segments [1]. - For 2025, total revenue and non-GAAP operating profit are projected to grow by 17% and 11% year-over-year, respectively [1]. - Despite facing sentiment-driven headwinds, Trip.com’s competitive advantages, including robust supply chain capabilities and high service quality, are expected to support long-term growth [1]. - The international expansion strategy is on track to unlock further development opportunities for the company [1]. Financial Summary - For FY25, Trip.com is expected to generate revenue of RMB62.51 billion, with a year-over-year growth of 17.1% [2]. - The adjusted net profit for FY25 is projected at RMB31.84 billion, reflecting a significant year-over-year increase of 76.5% [2]. - The company’s adjusted EPS for FY25 is estimated at RMB46.23, with a P/E ratio of 7.0 [2]. - The forecast for FY26 includes total revenue of RMB71.58 billion, with a growth rate of 14.5% year-over-year [11]. Revenue Breakdown - Domestic hotel booking volume growth is expected to be in the low teens year-over-year, while outbound air ticket and hotel bookings are anticipated to grow at a similar rate [9]. - The international business segment, including Trip.com and Skyscanner, accounted for 18% and 7% of group-level revenue in 4Q25, with Trip.com’s revenue growth exceeding 60% year-over-year [9]. - The company is targeting a non-GAAP operating profit margin of 28.3% for FY26, slightly down from 28.9% in FY25, due to the contribution from the international business which is still in a loss-making stage [11].

Investment Rating - The report maintains a BUY rating for BOE Varitronix, indicating a potential return of over 15% over the next 12 months [1][14]. Core Views - The company is expected to report FY25E revenue of HK$14,533 million, reflecting an 8% year-over-year growth, while net profit is projected to decline by 3% to HK$378 million due to domestic destocking pressure and pricing pressure [1][9]. - For 2H25E, revenue is estimated at HK$7,863 million (+8% YoY) and net profit at HK$198 million (-10% YoY), primarily impacted by domestic demand weakness and profitability in the system segment [1][9]. - Looking ahead to 2026, the report is optimistic about earnings recovery, driven by overseas sales growth, capacity ramp-up in Vietnam, and margin improvements from the Chengdu plant and system business [1][9]. Financial Summary - FY25E revenue is projected at HK$14,533 million, with a year-over-year growth of 8.1%, while net profit is expected to decline by 3.3% to HK$378 million [2][10]. - The report revises down FY25-27E EPS by 5-7% to account for near-term domestic headwinds and pricing pressure [1][12]. - The target price is set at HK$8.40, down from the previous target of HK$8.84, indicating a potential upside of 79.8% from the current price of HK$4.67 [3][14]. Earnings Estimates - The earnings estimates for FY25E include revenue of HK$14,533 million, operating profit of HK$421 million, and net profit of HK$378 million [10][12]. - For FY26E, revenue is expected to grow to HK$15,979 million, with net profit increasing to HK$473 million, reflecting a 25% year-over-year growth [2][11]. - The report highlights a projected operating margin of 2.9% for FY25E, improving to 3.3% by FY26E [12][19]. Valuation Metrics - The stock is currently trading at 7.8x FY26E P/E and 6.3x FY27E P/E, which the report considers attractive in terms of risk/reward [1][14]. - The report emphasizes the company's industry leadership in the auto display market and strong support from its parent company, BOE, for R&D technology and order/client wins [1][14].

Report Industry Investment Rating - The report maintains a buy rating on FUTLAN/FTLNHDs for their good carry and manageable refinancing risk [12] Core View of the Report - Seazen demonstrates better access to funding channels than most non - state - owned peers, and the new issuance and tender offers reflect its confidence in liquidity, making FUTLAN/FTLNHDs attractive for investment [7][8][12] Summary by Relevant Catalogs Trading Desk Comments - In the new issuance space, ADVANC 31 - 36s tightened 1 - 2bps from ROs, SUMI 31 tightened 6bps from RO at T + 90, SUMI 36 hovered around RO, SUMIBK 41 tightened 3bps, and DAESEC 29 - 31 initially opened 2bps wider but closed 1 - 2bps tighter [2] - In the secondary Chinese IG space, TMT MEITUA/KUAISH/LENOVO/BABA/TENCNT tightened 1 - 3bps, HAOHUA tightened 1 - 2bps, and Taiwan lifers edged 1bp tighter [2] - In Chinese properties, VNKRLE 27 - 29 retraced 0.2 - 0.5pt, FUTLAN 28/FTLNHD 26 - 27 rose 0.2 - 0.7pt, and LNGFOR 27 - 32 traded 0.1 - 0.3pt higher [2] - In HK, the NWDEVL/VDNWDL complex is 0.2 - 2.6pts higher, and LASUDE 26 was 0.5pt higher [2] - KR corporate bonds stabilized and tightened 1 - 3bps, JP insurance subs were roughly unchanged, and Yankee AT1s were unchanged to 0.1pt weaker [2] - In SE Asian space, OCBCSP 35s widened 2bps, VEDLN 28 - 33s were unchanged to 0.2pt higher, and VLLPM 27 - 29 gained 0.3 - 1.4pts [2] - In the Middle East, long - end KSAs were up to 0.4pt lower [2] - In LGFV space, profit - taking selling post - CNY was largely digested by RM demand [2] New Bond Information - The new NTT Float 31 tightened 1 - 2bps from RO at SOFR + 90, TOHOKU 31 tightened 5bps from RO at T + 70, OCBCSP 36 tightened 1bp from RO, and existing OCBCSP 35 tightened 2bps [3] - The new CNH INDON 29 - 31 edged 0.1pt higher from ROs, while INDON 36 was unchanged [3] - FUTLAN/FTLNHD: IPT at 13.25% for the new FTLNHD 29 is roughly fair, and FTLNHD 27 rose 1.6pts [3] - CBQKQD 4.5 Perp of USD500mn will be fully redeemed on 9 Mar'26 and was 0.1pt higher [3] Top Performers and Underperformers | Top Performers | Price | Change | Top Underperformers | Price | Change | | --- | --- | --- | --- | --- | --- | | NWDEVL 5 1/4 PERP | 84.3 | 2.6 | ROADKG 5.9 09/05/28 | 22.9 | - 0.9 | | NWDEVL 10.131 PERP | 86.0 | 2.4 | PTTGC 5.2 03/30/52 | 94.2 | - 0.6 | | NWDEVL 4 1/8 PERP | 77.3 | 2.1 | VNKRLE 3.975 11/09/27 | 47.9 | - 0.5 | | NWDEVL 6 1/4 PERP | 67.5 | 1.6 | PTTEPT 3.903 12/06/59 | 76.5 | - 0.4 | | VLLPM 7 1/4 07/20/27 | 51.9 | 1.4 | HIKTSU 6.13 09/18/35 | 101.8 | - 0.4 | [4] Macro News Recap - S&P (+0.81%), Dow (+0.63%) and Nasdaq (+1.26%) were higher on Wednesday, and 2yr UST yield was higher. 2/5/10/30 year yield was at 3.45%/3.61%/4.05%/4.70% [6] Desk Analyst Comments - The FV of the new FTLNHD 29 at 13.25% IPT is roughly fair considering FUTLAN 28's YTW of 13.3% adjusted for tenor differential [7] - Seazen launched tender offers for FTLNHD 26 at 101 and FTLNHD 27 at 98.182. Net proceeds from new bond issuance will fund FTLNHD 26 tender offer, and internal resources will fund FTLNHD 27 tender offer [8] - Holders subscribing to the new bond get priority acceptance in tender offers, and if not specifying allocation, Seazen prioritizes FTLNHD 26 [9] - Seazen has better access to funding channels. Earlier this month, it raised cUSD60.4mn through private share placement, and in 2025, it raised funds from bond markets and issued ABS [10][11] - Seazen's maturity profile is more manageable. It has cRMB7.0bn in public debts due by Dec'26, and refinancing FTLNHD 26 will alleviate near - term pressure [12] Bond Profiles and Tender Offer Summary | Security name | Issuer | Guarantor | Amt o/s (USD mn) | Maturity | Coupon | Px | YTW | | --- | --- | --- | --- | --- | --- | --- | --- | | FTLNHD 4 1/2 05/02/26 | New Metro Global | Seazen Group | 404 | 5/2/2026 | 4.50% | 99.6 | 7.0% | | FTLNHD 11.88 09/30/27 | New Metro Global | Seazen Group, Seazen Holdings | 160 | 9/30/2027 | 11.88% | 96.7 | 14.2% | | FUTLAN 11.88 06/26/28 | Seazen Group | N/A | 350 | 6/26/2028 | 11.88% | 98.2 | 13.3% | [13] | Security name | FTLNHD 4 1/2 05/02/26 | FTLNHD 11.88 09/30/27 | | --- | --- | --- | | ISIN | XS2290806285 | XS3192214685 | | Amt o/s (USDmn) | 404 | 160 | | Tender px (USD) | 101.0 | 98.182 | | Maximum acceptance amt (USDmn) | Any and all | 60 - 120 | | Expiration deadline | 5 Mar'26 GMT | | | Settlement date | On or about 10 Mar'26 | | [14] Offshore Asia New Issues Priced | Issuer/Guarantor | Size | Tenor | Coupon | Priced | Issue Rating | | --- | --- | --- | --- | --- | --- | | | (USD mn) | | | | (M/S/F) | | NTT Finance | 500 | 5yr | SOFR + 90 | SOFR + 90 | A3/A - / - | | Oversea - Chinese Banking Corporation | 500 | 10NC5 | 4.517% | T + 90 | A2/BBB + /A | | Tohoku Electric | 500 | 5yr | 4.324% | T + 70 | - /A - / - | [15] Pipeline | Issuer/Guarantor | Currency | Size (USD mn) | Tenor | Pricing | Issue Rating | | --- | --- | --- | --- | --- | --- | | | | | | | (M/S/F) | | New Metro Global | USD | - | 3yr | 13.25% | - /B/ - | | Sumitomo Mitsui Trust | USD | - | 3yr/5yr/10yr | T + 80 - 85/T + 90 - 95/T + 105 - 110 | A1/A/ - | [16][17] News and Market Color - 28 credit bonds were issued yesterday with an amount of RMB17bn. Month - to - date, 966 credit bonds were issued with a total amount of RMB745bn, a 22.8% yoy decrease [21] - Hong Kong government to increase luxury property taxes and halt commercial land sales [21] - UAE to exit JPMorgan Emerging Markets Index [21] - CBQKQD to fully redeem USD500mn 4.5 Perp on 9 Mar'26 [21] - SK Hynix to invest KRW21.6tn (cUSD15.0bn) and recorded a loss in derivative trading in 2025 [21] - Republic of Indonesia priced CNH bonds at tightened rates [21] - Moody's changed Mineral Resources' outlook to stable [21] - SK On signed a deal to buy lithium [21] - Vedanta Ltd's board approved raising up to INR30bn via NCDs [21]

Core Insights - The overall consumption trend during the Spring Festival aligns with expectations, characterized by a continued differentiation between material and service consumption, with emotional consumption represented by "self-pleasure" showing greater resilience [1][3] - Key sectors such as tourism, offline consumption, and online consumption exhibit varied performance, with tourism showing robust growth and offline retail and dining experiencing a positive uptick [1][3] Tourism Sector - During the Spring Festival holiday (February 15-23, 2026), domestic travel reached 596 million trips, with total spending of 803.48 billion RMB, reflecting a year-on-year increase of 5.7% in daily travel volume and 5.5% in daily spending [3] - Long-distance travel and family-oriented trips are highlighted as key trends, with family groups accounting for 68% of orders on platforms like Mafengwo [3] - The number of domestic travel orders on platforms like Fliggy increased by 80% year-on-year, with average booking amounts rising by approximately 10% [3] Offline Consumption - Key retail and dining enterprises reported a daily sales increase of 5.7% compared to the same period in 2025, with foot traffic and sales in 78 key pedestrian streets growing by 6.7% and 7.5% respectively [3] Online Consumption - Brand marketing efforts during the Spring Festival were significantly weaker compared to major promotional events like 618 and Double 11, leading to relatively flat sales performance [2] - In the beauty and skincare sector, total sales during the Spring Festival ranged from 212 million to 348 million RMB, with a year-on-year growth of approximately 12% [2][5] Beauty and Skincare Brands - Notable brands such as Maogeping and Proya saw significant year-on-year sales increases of 114.3% and 58.6% respectively, attributed to category expansion and strong brand performance [2][5] - Conversely, brands like Juzi Biotechnology experienced a drastic decline in sales by 56.8%, likely due to prior negative publicity and strategic marketing adjustments during the off-season [2][5] Jewelry Sector - The overall sales performance in the jewelry sector was weaker, with total sales dropping from a range of 285 million to 390 million RMB in 2025 to 260 million to 309 million RMB in 2026, reflecting a year-on-year decrease of 8.5% [4][9] - Brands such as Chow Sang Sang and Luk Fook achieved growth rates of 100% and 66.7% respectively, while mass-market brands like Chow Tai Fook and China Gold saw declines of 12.5% and 72% [4][9] Investment Recommendations - The report maintains a positive outlook on service-oriented consumption and emotional spending, particularly in travel and beauty sectors, recommending companies like Trip.com and Yingtong Holdings for investment [4]

Company Analysis - Yancoal Australia (3668 HK) is expected to see a 64% decline in net profit to AUD 440 million in 2025, which is 15% lower than market expectations but 20% higher than internal forecasts due to high sensitivity to profit per unit assumptions [2] - The company announced a final dividend of AUD 0.122 per share, along with an interim dividend of AUD 0.062 per share, resulting in a total payout ratio of 55%, in line with its dividend policy [2] - For 2026, Yancoal's equity sales volume is projected to grow by 3%, but unit cash costs are expected to rise by approximately 1% due to ongoing raw material cost inflation [2] - Coal price expectations for 2026 and 2027 have been raised by 8% and 7% respectively, reflecting signs of stabilization in shipping coal prices [2] - The target price for Yancoal has been increased from HKD 31 to HKD 38, based on an updated long-term thermal coal price assumption of AUD 140 per ton [2] Market Overview - The Hang Seng Index closed at 26,766, up 0.66% for the day and 4.43% year-to-date [3] - The Shanghai Composite Index rose by 0.72% to close at 4,147, with a year-to-date increase of 4.49% [3] - The US stock market saw all major indices rebound, with the Nasdaq gaining 1.26% [5] - European markets continued their upward trend, with the Stoxx 600 index rising by 0.69% to reach a historical high [5] - The offshore RMB exchange rate against the US dollar approached 6.85, marking a nearly three-year high [5] Industry Insights - The AI server business is expected to experience rapid growth, with a projected compound annual growth rate of 95% from FY25 to FY27, leading to AI-related revenue constituting 18% of total revenue by FY27 [6] - The company anticipates a recovery in gross and net profit margins in Q4 FY25, with gross margin expected to return to 20.2% and net margin to 5.0% [6] - The target price for Hongteng Precision has been raised to HKD 7.33, based on a 21x FY26E price-to-earnings ratio, maintaining a "buy" rating [6]