Investment Rating - The report maintains a Neutral rating on Tesla Inc (TSLA) with a 12-month price target of $250, representing a 17% upside from the current price of $213.65 [1][24] Core Views - Tesla is well-positioned for long-term growth due to its leadership in EVs, technical capabilities in AI, software, and hardware, and its ability to benefit from a full set of solutions including charging and storage [24] - Key debates include Tesla's ability to meet FSD performance and vehicle delivery growth targets for 2025, and the sustainability of margins [1][30] - The ramp in FSD is expected to take longer than Tesla's current targets, and auto fundamentals could remain volatile in the near-term with lower pricing/incentives as a headwind [24] Financial Performance - Tesla reported Q3 2024 revenue of $25.2 billion, 1% below the Street estimate, and non-GAAP diluted EPS of $0.72, $0.13 above the Street estimate [1] - Automotive non-GAAP gross margin (including SBC and excluding regulatory credits) was 17.1%, well above Goldman Sachs' estimate of 14.6% [1] - Energy segment gross margin was over 30%, stronger than the ~25% forecast [1] - Tesla expects vehicle deliveries to grow 20-30% in 2025 [1][30] Segment Performance - Automotive revenue was $20.016 billion, up 1% QoQ and 2% YoY, with regulatory credit sales of $739 million [23] - Energy Generation and Storage revenue was $2.376 billion, down 21% QoQ but up 52% YoY, with a record gross margin of over 30% [23] - Service and Other revenue was $2.790 billion, up 7% QoQ and 29% YoY, achieving a record gross profit in Q3 [23] Outlook and Guidance - Tesla reiterated expectations for vehicle volume growth in 2024 and deliveries to increase by 20-30% in 2025 [1][30] - FSD performance is expected to exceed human capability in Q2 2025, with miles between critical interventions up 100X with V12.5 compared to the start of the year [1][28] - Energy storage deployments are expected to more than double YoY in 2024 [30] Valuation and Estimates - The 12-month price target of $250 is based on 65X applied to Q5-Q8E EPS including SBC [36] - 2024/2025/2026 EPS estimates including SBC were raised to $2.03/$3.00/$4.25 from $1.80/$2.95/$4.20, driven primarily by higher gross margins and regulatory credit revenue [35]

Investment Rating - The report does not explicitly provide an investment rating for the industry or specific companies covered [1]. Core Insights - The air travel industry in China is experiencing a significant pullback in passenger traffic post-Golden Week, with domestic airfares decreasing over 15% year-on-year, reaching approximately 80% of 2019 levels, while international airfares have normalized to 105-110% of pre-COVID levels [1][3]. - Domestic passenger traffic is expected to increase by 6% year-on-year, reaching 107% of 2019 levels, while international traffic is forecasted to rise by 63% year-on-year, reaching 83% of 2019 levels [1]. - Group tours, which accounted for 40% of pre-COVID outbound travelers, have only recovered to 19% of the same period in 2019, indicating a bottleneck in outbound travel demand [1][3]. Summary by Sections Airfare Performance - Domestic airfares have declined to -20% compared to 2019 levels post-Golden Week, while international airfares remain at +5-10% compared to 2019 [5][11]. - The overall flight numbers have recovered to +1% compared to 2019, with a year-on-year increase of 8% [6]. Passenger Traffic - Weekly air passenger traffic has deteriorated sharply post-Golden Week, dropping to only 110% of the same period in 2019 [3]. - Domestic flight numbers have recovered to +6% compared to 2019, with a year-on-year increase of 4% [8]. Capacity Recovery - Capacity recovery for outbound destinations shows Malaysia and Singapore leading at 120% and 117% of 2019 levels, while the US has recovered the slowest at 29% [11][13]. - International flight capacity is expected to remain stagnant at 78% of 2019 levels [3]. Group Tour Recovery - Outbound group tour travelers to Singapore and Thailand have recovered the fastest, reaching 29% and 26% of 2019 levels, respectively, while Vietnam lags at 14% [1][14].

Investment Rating - The report lowers the investment rating for Indian equities from overweight to neutral, indicating a cautious stance due to slowing growth and high valuations [5][39]. Core Insights - Despite a structural positive outlook for Indian equities, economic growth and corporate profit growth are experiencing a cyclical slowdown, with real GDP growth expected at 6.5% for FY25, which is below consensus [5][8]. - The MSCI India index has rallied significantly, but high starting valuations at 24x forward earnings may constrain near-term upside, with historical data suggesting muted returns when valuations are elevated [5][21]. - The report emphasizes the importance of focusing on quality companies with high earnings visibility amid the current economic environment, highlighting 20 Buy-rated stocks with strong fundamentals [5][44]. Summary by Sections Economic and Corporate Profit Growth Slowdown - Economic growth is slowing across various sectors, with GDP growth estimates revised down to 6.7% for CY24 and 6.5% for FY25, reflecting a contraction in government capex and mixed signals in consumption indicators [8][12]. - Earnings sentiment has worsened, with a notable number of companies missing profit estimates during the recent reporting season, leading to downward revisions in earnings growth expectations for CY24 and CY25 [14][20]. Valuation Concerns - Current valuations for MSCI India are at historical peaks, with a significant premium over regional indices, raising concerns about the risk-reward profile for investors [21][27]. - The report notes that high valuations combined with earnings downgrades typically lead to lower future returns, suggesting a cautious approach to investment in the near term [21][23]. Sector Positioning - The report recommends reducing exposure to cyclical sectors and favoring domestic sectors with higher earnings visibility, such as autos, telecommunications, and insurance, while downgrading sectors like industrials and financials due to low visibility [39][43]. - The report highlights medium-term themes such as housing, clean energy, and tourism as potential areas for investment, indicating a focus on sectors with better demand visibility [48][51]. Market Dynamics - The report discusses the impact of external factors, including geopolitical tensions in the Middle East and regulatory measures by SEBI, which could affect market sentiment and trading activity [29][33]. - A significant outflow of foreign investment has been noted, with a shift in allocations from India to China, indicating changing investor sentiment in the region [24][26].

Investment Rating - The report maintains an "Overweight" (OW) rating on US and Asian equities, a "Neutral" (N) rating on Japan, and an "Underweight" (UW) rating on Europe for the 3-month horizon [3][4]. Core Insights - The report highlights a divergence in market performance, with US equities reaching new all-time highs driven by positive macro data, while many developed markets (DMs) outside the US remain significantly below their previous highs [1][4]. - The strong performance of US equities is supported by solid retail sales and improved macro surprises, contrasting with weaker trends in Europe and Japan [1][4]. - Emerging markets (EMs), particularly China, have shown signs of recovery, with September activity data surpassing expectations [1][4]. - The report indicates a bullish outlook for US growth, with cyclical sectors outperforming alongside rising inflation, while European equities are downgraded to a 3% EPS growth forecast for 2025 [3][4]. Summary by Sections Market Performance - US equities have outperformed, with flows into US equities being strong year-to-date, particularly compared to other developed markets [1][4]. - The positioning for US small caps has increased, with net long positioning on Russell 2000 reaching the highest level since 2021 [1][4]. Economic Indicators - The Risk Appetite Indicator closed at 0.3, the highest level since July, indicating increased risk appetite among investors [1][4]. - Macro surprises in the US have turned more positive since October, contrasting with negative trends in other major DMs [1][4]. Asset Allocation Recommendations - The report recommends an overweight position in US and Asian equities, with a neutral stance on Japan and an underweight position on Europe for the 3-month horizon [3][4]. - The S&P 500 is projected to deliver a total return of only 3% per annum over the next 10 years, despite its attractiveness in the near term [3][4]. Valuation Metrics - Current valuation metrics indicate that the S&P 500 is at a 95th percentile expensiveness relative to its 10-year history, with a forward P/E ratio of 22.0x [19][20]. - The report notes that US 10-year government bonds yield 4.1%, placing them in the 91st percentile of their historical range [19][20].

Investment Rating - The report assigns an "In-Line" investment rating for the China Autos industry [1]. Core Insights - The report provides an overview of the China Autos market, highlighting various companies and their respective market performances, projections, and ratings [1][4]. Summary by Relevant Sections Company Ratings and Performance - NIO Inc. (NIO-US) has a market cap of $10,638 million with a last close of $5.22, showing a performance decline of -69.2% in 2023 [4]. - XPeng, Inc. (XPEV-US) is rated "Overweight" with a price target of $6.1, last closing at $5.22, and a market cap of $8,472 million, reflecting a performance drop of -80.3% [4]. - Li Auto (LI-US) has a market cap of $22,416 million, rated "Overweight" with a price target of $29.0, and a last close of $25.25, showing a performance increase of 83.5% [4]. - BYD Company (002504-CN) is rated "Equal Weight" with a price target of $230.0, last closing at $300.30, and a market cap of $89,802 million, with a performance decline of -22.9% [4]. - Geely Automobile (175-HK) is rated "Overweight" with a price target of $11.2, last closing at $12.60, and a market cap of $16,331 million, reflecting a performance drop of -46.5% [4]. Market Trends and Projections - The report indicates a projected EPS CAGR of 45% for Li Auto from 2024 to 2026, while BYD is projected at 23% [4]. - The report notes that the automotive sector is experiencing significant volatility, with various companies showing drastic performance changes year-to-date [4]. Industry Overview - The China Autos industry is characterized by a mix of established players and emerging companies, with varying degrees of market capitalization and performance metrics [1][4]. - The report emphasizes the importance of monitoring market trends and company-specific developments to identify potential investment opportunities within the sector [1].

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - Consumer spending in China has slowed, with household nominal consumption growth decreasing to 3.5% year-over-year in Q3 2024 from 5.0% in Q2 2024, primarily due to reduced spending on residence, household items, and medical services [2][3] - The labor market showed signs of weakness in Q3, with urban unemployment rates increasing notably in July and August before slightly decreasing in September [2][7] - Household disposable income per capita grew by 5.0% year-over-year in Q3, an improvement from 4.5% in Q2, although urban wage growth moderated to 2.6% year-over-year from 3.6% [2][10] - The household savings rate increased slightly in Q3, but consumer confidence continued to decline, with the NBS consumer confidence index falling further in recent months [2][14] Summary by Sections Household Spending - Household nominal consumption growth slowed to 3.5% year-over-year in Q3 2024 from 5.0% in Q2 2024, with a quarter-over-quarter annualized growth of only 0.7% compared to 5.8% in Q2 [2][3] - The decline in consumption was mainly attributed to weaker spending on residence, household items, and medical services [2] Labor Market - The labor market weakened in Q3, with employment sub-indexes under various PMIs declining [2][7] - Urban surveyed unemployment rates increased significantly in July and August before decreasing slightly in September [2][7] Income Trends - Household disposable income per capita grew by 5.0% year-over-year in Q3, up from 4.5% in Q2, with a quarter-over-quarter annualized growth of 5.9% [2][10] - Urban wage growth moderated to 2.6% year-over-year in Q3 from 3.6% in Q2, indicating a slowdown in wage increases [2][11] Savings and Consumer Confidence - The household savings rate edged up in Q3, but the cumulative stock of household excess savings decreased to RMB 2.9 trillion from RMB 3.0 trillion in Q2 [2][14] - Consumer confidence, as measured by the NBS consumer confidence index, fell further in recent months, indicating a decline in consumer sentiment [2][14]

公众号: 永木纪要 Our preferred FX flow measure therefore suggests US$64bn net FX inflows in September, in comparison with US$9bn net FX inflows in August (Exhibit 1). 22 October 2024 | 7:55PM HKT China: SAFE data suggest strong FX inflows in September | --- | --- | |--------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------| | | | ...

Investment Rating - The report does not explicitly state an investment rating for the oil industry but provides insights into market conditions and trends that could influence investment decisions. Core Insights - The Brent crude price has shown some recovery after a decline, influenced by the People's Bank of China's unexpected interest rate cut and easing concerns over Iranian oil supply disruptions [2][4]. - Oil net managed money positioning has decreased significantly, now standing at the low 2nd percentile, indicating reduced speculative interest in the market [4][27]. - The US Lower 48 crude production nowcast is at 11.1 million barrels per day (mb/d), which is 0.2 mb/d below expectations, reflecting a decline in the oil rig count and production flows from key regions [9][10]. - China's oil demand nowcast has increased to 17.0 mb/d, the highest level in six months, driven by recovering industrial production and retail sales [5][14]. - OECD Europe oil demand nowcast has also seen a slight increase, now at 13.7 mb/d, but remains below earlier expectations [14]. Supply Summary - Trackable net supply has tightened by 0.1 mb/d week-over-week, with increased demand estimates for China and Europe offsetting a rise in Canadian liquids production [8]. - The US Lower 48 crude production nowcast remains unchanged at 11.1 mb/d, while Canada liquids production has increased to 6.1 mb/d [9][10]. - Russia's total liquids production nowcast is stable at 11.1 mb/d, which is 0.3 mb/d above expectations [10]. Demand Summary - China's oil demand has increased by 0.1 mb/d, reaching 17.0 mb/d, as demand recovers from previous weather-related weaknesses [5][14]. - OECD Europe oil demand has increased by 0.1 mb/d month-over-month, now standing at 13.7 mb/d, but is still below earlier forecasts [14]. Inventory Summary - OECD total oil commercial stocks have decreased by 12 million barrels (mb) to 2,789 mb, which is 22 mb above the end-of-October balance forecast [15]. - Global total oil commercial visible stocks have decreased by 8 mb, now at 4,756 mb, reflecting larger landed product draws [17][18]. Price and Volatility Summary - The Brent 1M/36M timespread has widened to -9 percentage points (pp), indicating a significant gap from its fair value [20]. - Brent implied volatility has narrowed by 2 pp to 5 pp, suggesting a decrease in market uncertainty [23]. Positioning Summary - Oil net managed money has decreased by 39 mb, now at 226 mb, reflecting a significant drop in speculative positioning [27]. - The current percentile for net managed money positioning is at a low 2nd percentile, indicating reduced market confidence [26][27]. Geopolitical Risks - The report highlights ongoing geopolitical tensions, particularly in the Middle East, which could impact oil supply and pricing dynamics [24]. Trade Recommendations - The report continues to recommend a long position in distillate cracks, reflecting a structurally bullish view on refining [25].

众众号:水木纪要 24 October 2024 | 6:25PM EDT Americas Energy: Oil: Amid Macro Volatility, What Are We Focused on Into Earnings for the US Super Majors? In this note, we update estimates for US Super Majors (XOM, CVX, COP) ahead of 3Q24 earnings results where we mark to market commodity prices for the quarter. While we remain mindful of the current oil macro backdrop, we reiterate our relative reference for Buy-rated COP and CVX, where we see 23% and 15% total regturn to our updated price targets (respectively). Fo ...

众号: 永木纪要 18 October 2024 | 1:05PM HKT China: 70-city average property price decline accelerated in September | --- | --- | |------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------| | | | | Bottom line: The National Bureau of Statistics' 70-city house price data suggests the weighted | | | average property price in the ...