本文档仅供上海信鱼私募基金管理有限公司18860455898研究使用，请勿外传 January 7, 2025 09:02 AM GMT Investor Presentation | Japan M Foundation Housing & Real Estate: Our Take on Brisk Office Market and Inflation Wave We believe that developers announcing new medium-term plans will boost expectations for improved Industry View In-Line governance and profit growth beyond inflation. We forecast focus on offices as lagging beneficiaries of inflation. We expect increasing inflationary pressures in the Japanese economy due to rising wages, and ...

January 6, 2025 05:00 AM GMT Global Economic Briefing | North America The Weekly Worldview: Our Global View After the Holiday Break M As we come back from a well deserved holiday break, we lay out our global views. Normally, our Year-Ahead Outlook is a roadmap for markets, but for 2025, it feels a bit more like a choose-your-own-adventure book (for the less familiar, these are American children's books that allow the reader to pick different narratives, and therefore different outcomes). Policy uncertainty ...

Summary of China Industrials Conference Call (26 December 2024) Industry Overview - The report focuses on the **China Industrials** sector, particularly analyzing export trends and performance in November 2024 [8][12]. Key Insights 1. **Export Growth**: China's overall exports increased by **5% YoY** in the first eleven months of 2024, with notable contributions from various sectors [23][24]. 2. **Sector Performance**: - **Hydrogen** and **wind equipment** showed the fastest year-over-year growth, attributed to a low base in November 2023 [8]. - **Low-value simplified exports** surged by **46% YoY**, while **chemical materials** and **electrical equipment** grew by **9%** and **14%** respectively [8]. 3. **Regional Contributions**: - The **ASEAN**, **US**, and **EU** were the top regions contributing to export growth, with exports to the US rising by **8%** and to Mexico by **3%** YoY [8][10]. - Exports to the EU and Africa increased by **7%** and **11%** YoY respectively [8]. 4. **Sectoral Breakdown**: - Off-road vehicles (ORVs), optical fiber, battery materials, and batteries accounted for a significant share of exports to the US, while cosmetics and pharmaceuticals saw a decline [8]. - In the EU, agricultural machinery and cosmetics gained share, whereas battery and solar exports decreased [8]. 5. **Technology Sector**: The technology sector was a major growth driver for exports to Asia, with increasing shares in HDT, cosmetics, and consumer electronics [8]. Additional Insights 1. **Export Value Breakdown**: - The top 10 sectors comprised approximately **35%** of November's YoY incremental export value [15]. - The bottom 10 sectors experienced significant declines, with passenger vehicles and home appliances showing the largest drops [13]. 2. **Export Trends**: - Exports to Japan and Korea saw declines of **3%** and **2%** YoY respectively, indicating challenges in these markets [10]. - The report highlights a shift in export dynamics, with certain sectors like **battery materials** and **solar** facing headwinds [12][13]. 3. **Future Outlook**: The report suggests that while certain sectors are thriving, others may need strategic adjustments to enhance competitiveness in the global market [8][12]. Conclusion The China Industrials sector is experiencing mixed performance in exports, with strong growth in specific areas like hydrogen and low-value exports, while facing challenges in traditional sectors such as automotive. The regional dynamics indicate a robust demand from ASEAN and the US, but caution is warranted in markets like Japan and Korea.

Summary of HKEx Conference Call Company and Industry Overview - The conference call discusses the performance and outlook of Hong Kong Exchanges and Clearing Limited (HKEx) [1][3][19]. Core Points and Arguments - **Long-term Trading Activity Support**: Several factors are expected to support trading activity in capital markets from a long-term perspective [1]. - **Revenue Challenges**: Geopolitical uncertainties, particularly related to the new US administration's policies and potential tariff hikes, pose risks to HKEx's revenue [3]. - **Revenue Forecasts**: Revenue expectations for HKEx are projected to increase by 2.7% for 2024 and 4.5% for 2025, driven by higher average daily volume (ADV) assumptions [4][8]. - **Earnings Per Share (EPS) Adjustments**: EPS forecasts have been raised by 4% for 2024, 6.9% for 2025, and 7.4% for 2026 due to increased revenue expectations [4][8]. - **Market Capitalization Growth**: Market cap growth is expected to be -25.6% in 2022, -5.9% in 2023, and then recover to 5.0% in 2024, 12.0% in 2025, and 15.0% in 2026 [7]. - **Price Target Adjustments**: The price target for HKEx has been raised to HK$310, reflecting a more favorable economic outlook [8][19]. Financial Metrics - **Average Daily Volume (ADV)**: Projected ADV is HK$135 billion for 2024 and HK$150 billion for 2025, with a velocity of 93% and 92% respectively [10][12]. - **Revenue Breakdown**: Total revenues are expected to reach HK$22,890 million in 2024, HK$23,767 million in 2025, and HK$25,301 million in 2026 [8][17]. - **Profitability Ratios**: The EBITDA margin is projected to be 72.3% in 2024 and 73.2% in 2025, with a return on equity (ROE) of 25.55% in 2024 [21][22]. Risks and Considerations - **Geopolitical Risks**: Rising geopolitical uncertainties could negatively impact revenue and trading activity [3][19]. - **Market Conditions**: The potential for a sharp pickup in market conditions and IPO activity is noted as a risk to the downside [24]. - **Regulatory Environment**: Changes in regulations affecting IPOs and market liquidity could pose risks to revenue [24]. Additional Insights - **Investment Drivers**: The call highlights the importance of market turnover, IPO listings, and recurring listing fees as key drivers of revenue [24]. - **Consensus Rating**: The consensus rating distribution indicates a majority overweight position on HKEx, with a significant portion of analysts maintaining a positive outlook [19][24]. This summary encapsulates the key points discussed during the HKEx conference call, providing insights into the company's performance, forecasts, and the broader market context.

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Leisure & Hotels, specifically focusing on the European and Chinese markets - **Key Companies Mentioned**: TUI, Carnival, Sodexo, IHG, Edenred, SSP Group Core Insights and Arguments 1. **China RevPAR Performance**: - Greater China's RevPAR is tracking -8% vs 2019 YTD, indicating a significant underperformance compared to Europe and the US, which are tracking at +29% and +15% respectively [1][3] - The local hotels team anticipates a sequential weakening in RevPAR, with expectations of -2% YoY RevPAR in Mainland China for the next year, and a worse outlook for Q1 2025 at -3% to -5% [3] 2. **TUI's Financial Forecast**: - TUI is expected to report FY24 revenues of €22.8 billion (+11%) and underlying EBIT of €1,286 million (+32%) [11] - The company is focusing on strong Hotel/Cruise performance and improving free cash flow (FCF) [11][12] 3. **Carnival's Q4 Expectations**: - Carnival is forecasted to have Q4 EPS of $0.09, with guidance for FY25 yields of 3-4% [21] - The company is expected to report revenues of $6.0 billion (+12%) and adjusted EBITDA of $1,199 million (+27%) [21] 4. **Sodexo's Sales Growth**: - Forecasted organic sales growth of 5.3% and revenues of €6.5 billion for Q1 [3] 5. **IHG's Market Position**: - IHG has significant exposure to the Chinese market, with 20% of its rooms located there, and is facing challenges due to persistent deflation and weak consumer fundamentals [3] Additional Important Insights 1. **Market Dynamics**: - Chinese hotel demand has recovered to nearly 100% of 2019 levels, driven by strong domestic leisure travel, but business and inbound travel remain weak [1] - The overall hotel industry outlook has been downgraded due to concerns over deflation and supply growth impacting room rates [3] 2. **Future Guidance**: - TUI's guidance for FY25 is expected to align with a mid-term ambition for a 7-10% EBIT CAGR, with a focus on cruise operations and improved operational efficiencies [17] - Carnival's guidance for FY25 is anticipated to reflect a cautious but optimistic outlook, with a focus on maintaining pricing power and managing costs effectively [26] 3. **Valuation Metrics**: - TUI shares are trading at 6.6x P/E and 4.4x EV/EBITDA for 2025e, which is considered inexpensive compared to pre-Covid averages [18] - Carnival's shares are currently trading at 15x FY25e P/E, above its historical average, raising concerns about high leverage and operational performance [29] 4. **Operational Challenges**: - The hotel industry is facing challenges with occupancy rates down in the low to mid single digits compared to 2019 levels, and room rates have decreased by 3% vs 2019 [1][3] 5. **Upcoming Events**: - Key upcoming reports include TUI's FY24 results on December 11 and Carnival's Q4 results towards the end of December [5][21] This summary encapsulates the critical insights and forecasts from the conference call, highlighting the current state and future outlook of the leisure and hotel industry, particularly in Europe and China.

Global Markets Strategy 02 December 2024 J P M O R G A N EM Equity ETF Flows Broad redemptions in November post US election – 29 November 2024 | --- | --- | --- | |-------------------------------------------------------|-------|--------------------------------------------------------| | | | | | | | Equity Macro Research | | | | Rajiv Batra AC | | | | (65) 6882-8151 rajiv.j.batra@jpmorgan.com Khoi Vu, CFA | | • Total EM: Net subscriptions of US$4mn. | | (65) 6882-8170 khoi.t.vu@jpmorgan.com | | • Frontier Ma ...

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the **China Consumer Market**, focusing on various sectors including **cosmetics**, **sportswear**, **home appliances**, and **infant milk formula (IMF)**. The early start of the **Double 11** shopping event significantly influenced sales performance across these categories [3][4][25]. Key Highlights 1. Category Performance - **Tissue/RVC** categories showed strong performance with completion rates of **67%** and **57%** respectively, while categories like **IMF**, **skincare**, and **pet foods** lagged with completion rates of **45-50%** [3]. - **Cosmetics** sales grew by **92%** year-over-year (YoY) in October, with a **46%** completion rate compared to the same period in 2023. Including Douyin, the growth was **66%** YoY [8]. - **Home appliances** experienced significant growth, particularly in major categories like white goods and kitchen appliances, with YoY growth rates of **+97%**, **+56%**, and **over 70%** [9]. 2. Brand Performance - **Local brands** in cosmetics outperformed multinational corporations (MNCs), with **Giant Biogene** achieving a **388%** YoY growth and a completion rate of **127%**. Other local brands like **Botanee** and **Bloomage** also reported strong growth rates of **166%** and **155%** respectively [26][27]. - Among MNCs, **LG H&H** led with **252%** YoY growth, while **L'Oreal** and **Estee Lauder** reported **187%** and **164%** growth respectively [27]. 3. Infant Milk Formula (IMF) Market - The IMF category saw a **48%** YoY growth on Tmall/Taobao, with local brands like **Yili** and **Feihe** achieving **105%** and **41%** growth respectively [19][20]. - Overall, IMF sales grew by **30%** YoY in October, indicating a strong recovery from previous months [20]. 4. Sales Trends and Consumer Behavior - The early start of the **Double 11** event led to a front-loaded sales performance, with many categories experiencing higher growth rates compared to previous months [4][25]. - **Discount levels** were better than expected, contributing to a positive sales environment for sportswear and other categories [5]. 5. Challenges and Underperformance - Certain categories, particularly **supplements**, continued to struggle with a **0%** YoY growth rate on Tmall/Taobao, indicating a need for strategic adjustments [7]. - **Amore** was noted as the underperformer in the cosmetics sector, with only **8%** YoY growth, significantly below the levels seen in 2023 [27]. Additional Insights - The divergence in performance across categories suggests varying consumer preferences and market dynamics, with some brands successfully leveraging omni-channel strategies to enhance sales [6]. - The completion rates provide a clearer picture of sales performance, mitigating the effects of base year comparisons and timing differences associated with the Double 11 event [25]. This summary encapsulates the critical insights from the conference call, highlighting the performance trends, brand dynamics, and market challenges within the China consumer sector.

To Answer the Question of Why I Invest in China I invest in China because... ...I can't diversify as well as I'd like to without investing in China. For example, China and the US are the only dominant powers in the most important industries and how these two nations are with each other will shape the world. ...I have invested throughout many cycles in many countries and learned the adage "the time to buy is when there is blood in the streets." In other words, the time to buy is when everyone hates the marke ...

Economic and Debt Challenges - China is facing significant debt and economic problems, with falling real estate prices, equity and asset prices, employment, and employee compensation contributing to a dour economic mood[26] - The average retirement age in China is 53, while the average age of death is 84, creating a 31-year gap where retirees must be supported, adding financial strain to families and the government[27] - The leadership needs to engineer a "beautiful deleveraging" to balance deflationary debt reduction with inflationary monetary easing, or risk a Japanese-style "lost decade"[10] Internal Wealth and Political Dynamics - The internal wealth gap has intensified, leading to government actions perceived as anti-capitalist, such as common prosperity initiatives and arbitrary wealth redistribution, which are fear-inducing for capitalist elites[28] - Xi Jinping's leadership has shifted towards stricter control and autocratic policies, with purges and crackdowns on corruption, particularly in the military, creating a more oppressive environment[28][29] Geopolitical and Trade Tensions - The US-China great-power conflict is causing foreign and domestic investors to diversify or leave China, with trade and capital flows becoming a geopolitical cat-and-mouse game[30] - China's economic model, based on increasing global manufacturing share, is under threat due to rising tariffs and protectionism, particularly in industries like electric vehicles, batteries, and green energy[30] Technological and Environmental Pressures - Technology development is a critical battleground, with China and the US competing in areas like AI, quantum computing, and clean energy, with significant geopolitical and economic implications[15] - Climate-related issues, including droughts, floods, and pandemics, are top-of-mind threats that will likely impose significant costs and hardships on China[31]

Market Trends and Valuations - Nvidia's market cap has grown similarly to Cisco during the tech bubble, with a rapid increase reaching 100% of its peak value[1] - Nvidia's two-year forward P/E ratio is around 27, significantly lower than Cisco's 100 during the tech bubble, indicating more grounded near-term earnings prospects[2][17] - The Mag-7 (Magnificent 7) companies have driven over 80% of the gains in US equities since January 2023, now constituting over 25% of the S&P 500 market cap[15] Earnings and Growth Projections - The Mag-7 is discounting very high earnings growth, with projected earnings growth rates significantly elevated compared to historical averages[5][10] - Nvidia's earnings have grown significantly alongside its market cap, with actual orders validating continued growth expectations[17] Bubble Indicators and Sentiment - The current US equity market bubble gauge is at the 73rd percentile, suggesting elevated but not bubbly conditions[19] - Retail trading activity is at the 55th percentile, higher than typical but not excessively concerning[25] - Sentiment around AI is bullish, with over 35% of recent earnings calls mentioning AI, reflecting high expectations for growth[48][64] Leverage and Speculative Activity - Household margin debt has declined meaningfully from COVID-era peaks and is now near 10-year lows, indicating healthier leverage conditions[53][54] - Options activity in the Mag-7 is not excessively elevated, with turnover as a share of market cap not indicating a speculative frenzy[50][58] Forward Purchases and Capex - Forward purchases for the Mag-7 look frothy, with companies investing significantly in capex and R&D, reaching all-time highs as a share of GDP and sales[79][84][90]