Investment Rating - Maintain BUY rating with a target price of USD 124.50, indicating a potential upside of 60% from the current price [57]. Core Insights - The report highlights a significant decline in Alibaba's market share in China's e-commerce sector, dropping from 71.4% in 2018 to 39.4% in 2023, with a projected further decline to 37.2% in 2024, suggesting a stabilization of share loss [2]. - The competition from content-based e-commerce platforms like Douyin and Kuaishou, as well as Pinduoduo, has intensified, impacting Taobao and Tmall's market position [5][6]. - Alibaba's strategy is shifting from "helping make business" to "helping improve business," focusing on enhancing efficiency and profit margins rather than solely driving GMV growth [11]. - The total retail sales of consumer goods in China increased from RMB 29 trillion in 2015 to RMB 47 trillion in 2023, with Alibaba's GMV rising from RMB 3 trillion in FY16 to approximately RMB 8 trillion in FY24, indicating its growing importance in the retail landscape [13]. Summary by Sections E-commerce Market Dynamics - The e-commerce market in China is experiencing a shift, with content-based platforms gaining traction and affecting traditional e-commerce models [5][6]. - Pinduoduo's rapid growth is attributed to its focus on low-tier cities and effective demand creation strategies, similar to Taobao's early days [6][7]. Financial Performance - T&T Group achieved a revenue growth of 5.2% year-on-year for FY24, with expectations of high-single-digit GMV growth for the retail business in FY25 [40]. - The adjusted EBITA for T&T Group increased by 3.0% year-on-year, with a margin of 44.8%, reflecting the impact of revenue mix changes [41]. Future Outlook - The report anticipates a positive cycle for Alibaba driven by user subsidies and improved monetization tools, which could enhance profit margins and support growth [54]. - The potential inclusion in the Hong Kong Stock Connect is expected to attract significant capital inflows, further bolstering Alibaba's market position [55].

Investment Rating - The investment rating for Melco International Development is "BUY" with a target price of HKD 5.60 based on a 2025E EV/EBITDA of 7.0x [7][30]. Core Insights - Melco Resorts & Entertainment reported a net income of USD 1,160 million in 2Q24, reflecting a 4.3% quarter-over-quarter increase. The adjusted property EBITDA was USD 303 million, up 1.3% quarter-over-quarter, achieving 68% of the 2Q19 level. The property EBITDA margin stood at 26.2% [2][3]. - The projected GGR for 2025 and 2026 is estimated at HKD 36,991 million and HKD 40,293 million, which corresponds to 79% and 86% of the 2019 levels. The recovery in VIP, mass market, and slot revenue is expected to reach 29%, 123%, and 96% of 2019 levels respectively [2][3]. - The report indicates that Melco's GGR recovery is lagging behind the industry, with mass-market and slot growth showing signs of slowing down [2][3]. Financial Performance - For 2Q24, Melco's GGR was USD 1,223 million, which is 70% of the 2Q19 level, compared to the sector's 77%. VIP revenue decreased by 5% year-over-year but increased by 15% quarter-over-quarter, recovering to 25% of the 2Q19 level [3][4]. - City of Dreams Macau was the largest contributor to net income, accounting for 50% with an EBITDA margin of 29%. Studio City contributed 30% of net income with an EBITDA margin of 23% [4][5]. - In July, inbound tourist trips reached 3,028,000, averaging 98,000 daily, which is 85.8% of the level in the same period of 2019, indicating a potential strengthening of the gaming industry [5][6]. Revenue and Profit Projections - Revenue projections for Melco International Development are as follows: HKD 34,823 million for 2024E, HKD 38,400 million for 2025E, and HKD 42,344 million for 2026E [6][15]. - The net profit attributed to the parent company is expected to be HKD 1,014 million in 2024E, HKD 1,822 million in 2025E, and HKD 1,631 million in 2026E [6][15]. - The diluted EPS is projected to be HKD 0.51 for 2024E, HKD 0.92 for 2025E, and HKD 0.82 for 2026E [6][15].

Investment Rating - The investment rating for Ganyuan Foods is maintained as BUY with a target price of RMB 69.36, indicating a potential upside of 26% from the closing price of RMB 54.90 as of August 7, 2024 [8][9]. Core Insights - Ganyuan Foods experienced a quarter-on-quarter slowdown in revenue growth in 2Q24 due to off-season effects and personnel adjustments within the distribution team. However, year-on-year growth remains strong with revenue, attributable net profit, and recurring net profit for 1H24 increasing by 26.1%, 39.3%, and 40.0% respectively [3][4]. - The company’s gross profit margin (GPM) declined by 0.6 percentage points year-on-year in 2Q24, attributed to structural changes in product sales channels and weakening economies of scale. Despite this, the company expects to increase its payout ratio, enhancing shareholder returns [5][6]. - Ganyuan Foods' classic products, including green peas, melon seeds, and flavored nuts, showed robust revenue growth, with significant contributions from membership supermarkets and bulk sales channels [4][6]. Financial Performance Summary - For 1H24, Ganyuan Foods reported revenues of RMB 1,040 million, with a net profit of RMB 170 million. In 2Q24, revenues were RMB 460 million, reflecting a 4.9% year-on-year increase [3][4]. - The company’s revenue projections for the upcoming years are as follows: RMB 2,254 million for 2024, RMB 2,714 million for 2025, and RMB 3,193 million for 2026, with corresponding net profits of RMB 380.61 million, RMB 468.71 million, and RMB 551.05 million [7][9]. - The estimated earnings per share (EPS) for 2024, 2025, and 2026 are RMB 4.08, RMB 5.03, and RMB 5.91 respectively, with a price-to-earnings (PE) ratio projected at 17x for 2024 [6][7].

Investment Rating - The investment rating for Angel Yeast is maintained as BUY with a target price of RMB 38.39, indicating a potential upside of 24% from the closing price of RMB 30.87 as of August 12, 2024 [8][9]. Core Insights - Angel Yeast reported 2Q24 earnings that exceeded expectations, with revenue and net profit showing significant year-on-year growth of 11.3% and 17.3% respectively. The company is expected to resume growth momentum due to increased demand in its main business and improved overseas performance [3][4]. - The gross profit margin (GPM) for 2Q24 rose by 0.3 percentage points year-on-year to 23.9%, attributed to faster revenue growth from high-margin products and declining molasses prices, which are expected to reduce cost pressures [5][6]. - The company has revised its earnings forecasts upward, projecting EPS of RMB 1.60, RMB 1.80, and RMB 2.07 for 2024, 2025, and 2026 respectively, reflecting a positive outlook on domestic demand recovery and overseas market expansion [5][6]. Revenue and Profit Performance - For 1H24, Angel Yeast's revenue reached RMB 7,180 million, with attributable net profit of RMB 690 million, marking a year-on-year increase of 6.9% and 3.2% respectively. The overseas revenue grew by 17.9% year-on-year, while domestic revenue saw a modest increase of 0.9% [3][4]. - The performance of various product segments showed mixed results, with yeast and deep processing products increasing by 8.8% year-on-year, while sugar and packaging segments experienced declines of 26.5% and 12.8% respectively [4]. Financial Projections - The financial outlook for Angel Yeast includes projected revenues of RMB 14,969 million, RMB 16,629 million, and RMB 18,364 million for 2024, 2025, and 2026 respectively, indicating a steady growth trajectory [7][13]. - The company’s net profit is expected to reach RMB 1,390 million, RMB 1,565 million, and RMB 1,799 million for the same years, reflecting a positive growth trend [7][13].

Investment Rating - The report indicates a positive outlook for H-shares, suggesting they may have bottomed out due to several supportive factors [2][3][4] Core Insights - H-shares experienced an increase amid volatility, supported by a decline in the HSI short-selling ratio from 20% to 13%, better-than-expected earnings from leading pharmaceutical companies, easing external market pressures, and a rise in the RMB exchange rate [2] - The report highlights a rebound in H-share earnings growth since the end of 2022, particularly in the "greater consumption" sectors, with notable earnings improvements in pharmaceuticals and consumer services [3] - The ongoing summer travel boom and government policies aimed at expanding domestic demand are expected to sustain consumption momentum, although price cuts have been observed in the travel sector [4] Summary by Sections H-Shares Performance - H-shares have shown resilience with narrowed net outflows of foreign capital and increased net inflows of southbound capital, indicating improved liquidity [2] - The report anticipates defensive attributes in H-share valuations in the short term, suggesting a focus on sectors sensitive to domestic demand and USD liquidity [6] Sector Analysis - The "greater consumption" sectors, particularly pharmaceuticals and consumer services, have seen significant earnings growth, with over 30% of companies in these sectors reporting improved earnings [3] - Midstream materials have faced pressure, likely due to reduced sales volumes and prices in cement and building materials [3] Economic Indicators - Recent economic data from the US has eased recession concerns, contributing to a stabilization in US stocks and a reduction in net outflows from H-shares [5] - The report emphasizes the importance of monitoring upcoming economic data, including the Jackson Hole Economic Symposium and US non-farm payrolls, for future market direction [6]

Investment Rating - The investment rating for By-health is maintained as BUY with a target price of RMB15.37, indicating a potential upside of 31% from the closing price of RMB11.71 as of August 9, 2024 [7][8]. Core Insights - By-health's revenue and net profit have declined significantly in the first half of 2024, with revenue at RMB4,610 million (-17.6% year-on-year) and attributable net profit at RMB890 million (-42.3% year-on-year) [3][4]. - The decline is attributed to a high base from the previous year and challenges in the company's omni-channel strategy, which includes a diverse product lineup facing competition across various e-commerce platforms [3][4]. - The company plans to focus on its main brand and Life-Space, consolidating offline sales channels and enhancing product differentiation to expand into lower-tier markets [3][4]. Financial Performance Summary - For 1H24, By-health's gross profit margin (GPM) fell to 68.6%, down 1.8 percentage points year-on-year, with a notable decline in the second quarter to 66.8% [4]. - The sales expense ratio increased to 39.5% in 1H24, primarily due to higher brand promotion investments and increased platform expenses [4]. - The company has revised its earnings forecasts downward, estimating EPS for 2024, 2025, and 2026 at RMB0.70, RMB0.83, and RMB0.97 respectively [5][6]. Revenue and Profit Forecasts - Revenue projections for By-health are as follows: RMB8,447 million for 2024, RMB9,268 million for 2025, and RMB10,032 million for 2026, reflecting a decline in 2024 followed by growth in subsequent years [6]. - Net profit estimates are projected at RMB1,188 million for 2024, RMB1,419 million for 2025, and RMB1,648 million for 2026, indicating a recovery trend after a significant drop in 2024 [6]. Market Position and Strategy - By-health continues to strengthen its brand presence despite facing short-term revenue adjustments due to changing consumer sentiment and increased competition [4]. - The company is focused on improving operational quality and refining its strategy to adapt to the evolving market landscape [4].

Investment Rating - The investment rating for Tasly Pharmaceutical is maintained at OVERWEIGHT, with a target price of RMB17.30, indicating a potential upside of 25% from the closing price of RMB13.85 as of August 9, 2024 [3][10][30]. Core Insights - The controlling shareholder of Tasly, Tasly Group, plans to transfer 28% of its share capital (approximately 418 million shares) to CR Sanjiu for a total consideration of around RMB6,212 million. This acquisition is expected to enhance CR Sanjiu's industrial chain and leverage Tasly's expertise in traditional Chinese medicine and innovative pharmaceuticals [3][4]. - Tasly is projected to achieve attributable net profits of RMB1.18 billion, RMB1.31 billion, and RMB1.46 billion for the years 2024, 2025, and 2026, respectively, reflecting year-on-year growth rates of 10%, 11%, and 11% [3][4]. - The report anticipates stable business fundamentals for Tasly in 2024, with steady growth in its traditional Chinese medicine segment and a rally in sales volume for chemical drugs driven by the VBP program [5][6]. Summary by Sections Business Overview - Tasly is recognized as a leader in traditional Chinese medicine prescription drugs and has a strong R&D pipeline with 98 products in development. The company has developed blockbuster products such as Danshen and Yangxue Qingnao [4][5]. Financial Projections - Revenue is expected to grow from RMB8,593 million in 2022 to RMB10,506 million by 2026, with net profit projected to increase from a loss of RMB256.51 million in 2022 to RMB1,460 million in 2026 [8][15]. - The earnings per share (EPS) is forecasted to rise from a loss of RMB0.17 in 2022 to RMB0.98 in 2026 [8][15]. R&D and Innovation - Tasly has consistently invested in R&D, with annual expenses ranging from RMB600 million to RMB900 million since 2018, representing an R&D expense ratio of 5-10%. The company has independently developed over 20 novel TCM products, with several projects expected to submit NDAs starting in 2024-2025 [6][4]. Market Position - The acquisition by CR Sanjiu is expected to reshape Tasly's competitive landscape, integrating management systems and potentially adjusting business practices from 2025 onwards [4][5].

Investment Rating - The investment rating for Wens Foodstuffs is "BUY" with a target price of RMB25.53, indicating a potential upside of 29% from the closing price of RMB19.78 as of August 12, 2024 [2][7]. Core Views - Wens Foodstuffs has experienced a significant rise in meat pig selling prices, with the average price reaching RMB18.95/kg in July, which is above the industry average. The estimated per-head profit for meat pigs is nearly RMB600 [2][3]. - The report anticipates buoyant demand for pigs and broilers in the second half of 2024 due to tight supply dynamics and an approaching peak consumption season, which is expected to sustain earnings growth for Wens [2][4]. - The financial projections for Wens indicate a net profit of RMB10.0 billion in 2024, increasing to RMB13.4 billion in 2025, and RMB13.1 billion in 2026, with a book value per share (BVPS) of RMB6.48, RMB8.29, and RMB10.16 respectively [2][5]. Summary by Sections Financial Performance - Revenue is projected to grow from RMB89.92 billion in 2023 to RMB104.68 billion in 2024, and further to RMB125.67 billion in 2025 [5]. - The net profit is expected to recover from a loss of RMB6.39 billion in 2023 to RMB10.04 billion in 2024, and reach RMB13.36 billion in 2025 [5]. - The diluted EPS is forecasted to improve from -0.96 in 2023 to 1.51 in 2024, and 2.01 in 2025 [5]. Market Dynamics - The report highlights a potential contraction in hog supply in the second half of 2024, which is expected to drive up prices and enhance profitability for Wens [2][4]. - The demand for yellow-feather broilers is projected to increase due to early-stage destocking and seasonal consumption patterns, contributing to a favorable pricing environment [2][4]. Competitive Position - Wens Foodstuffs is noted for its solid cost advantage in hog breeding, which is expected to further enhance its per-head profit margins [2][4]. - The company is likely to continue making progress in breeding, production, and management, which will contribute to a steady decline in breeding costs [3][4].

Investment Rating - The report indicates an optimistic outlook on China's export growth, suggesting resilience in the face of global trade dynamics [2][17]. Core Insights - China's export value in USD terms increased by 4% year-on-year (yoy) in the first seven months of 2024, with a notable growth in export value in RMB terms (6.7%) and export volume (approximately 15%) [2][17]. - The trade surplus in 7M24 rose by 11% yoy, contributing positively to GDP and corporate profit growth [2][17]. - The report highlights the significant role of intermediate goods in China's export structure, which accounted for about 50% of total exports in 2023 [20][26]. Summary by Sections I. Overseas Production Expansion - A Perspective of Intermediate Goods Trade - Intermediate goods exports surged post-2020, making up half of total exports in 2023, with double-digit annualized growth in semi-finished products and components [5][20]. - Key categories of intermediate goods include telecommunications equipment, electronic components, textiles, steel, batteries, and auto parts, which collectively represent over 70% of exports [5][22]. - The share of intermediate goods exports to Southeast Asia has increased significantly, while exports to the US have contracted since 2018 [22][34]. II. Progress in Overseas Plant Construction - A Perspective of Raw Material and Machinery Exports - Southeast Asia remains the primary destination for China's construction machinery exports, with notable growth in exports to Brazil and Mexico in 2024 [7][55]. - China's steel exports have seen robust growth, particularly to Southeast Asia and the Middle East, with a significant increase in construction machinery exports reflecting overseas investment [51][58]. - The report notes a rebound in the export volume of construction machinery, indicating a fresh round of overseas expansion by Chinese enterprises [53][56]. III. ASEAN and Latin America as Destinations for Overseas Expansion - In 2023, China's overseas direct investment (ODI) achieved structural growth, with ASEAN and Latin America receiving the most investment, accounting for 28% and 25% of ODI, respectively [9][75]. - The report emphasizes the increasing trend of Chinese investment in the Middle East and Africa, alongside a decline in investment in the US and Europe [75][77]. - The Belt and Road Initiative is expected to enhance cooperation between China and countries in Asia, Africa, and Latin America, further supporting overseas expansion [75][76].

Investment Rating - The report does not explicitly provide an investment rating for the industry, but it discusses various trends and performance metrics that could influence investment decisions. Core Insights - China's year-on-year export growth in USD terms decreased from 8.6% in June to 7% in July 2024, falling below the Bloomberg consensus estimate of 9.5% [1] - Year-on-year import growth in USD terms increased from -2.3% in June to 7.2%, surpassing the Bloomberg consensus estimate of 3.2% [1] - The trade surplus in July was USD 84.7 billion, down from USD 99.0 billion in June, but up by approximately USD 5.3 billion year-on-year [1][23] Summary by Sections Macro Views - The global manufacturing cycle has shown signs of marginal weakening, with the manufacturing PMI across developed countries falling below the 50 boom-bust line [2] - A slowdown in US consumption is impacting China's exports of light industrial products and textiles, with actual consumer spending in the US increasing by only 0.2% month-on-month in June [2] - The export price index has faced setbacks, with Brent crude oil prices falling by 5.7% in July [2] Export Performance - High-end manufacturing, particularly in automobiles, continues to show rapid export growth, supported by a buoyant business climate for industrial chains [3] - In July 2024, year-on-year growth in exports of mechanical and electrical products was strong at 10%, contributing 5.8 percentage points to overall export growth [4][17] - Exports of light industry and textiles fell by 2.4%, attributed to a slowdown in US consumer demand [4] Import Performance - Year-on-year import growth in USD terms increased to 7.2%, driven by a low base effect from July 2023 and strong demand in the electronics sector [7] - Notable increases in import growth were seen in energy products, with coal imports rising by 20.8 percentage points to 17.4% year-on-year [7] Regional Export Trends - Exports to developed countries, including the US and EU, showed growth, with year-on-year increases of 8.1% and 8.0% respectively [6] - Exports to developing countries, particularly in ASEAN and Latin America, have shown signs of slowing momentum [6] Future Outlook - The report anticipates potential disruptions to China's exports due to slowing overseas demand and uncertainties surrounding the upcoming US elections [8] - The sustainability of import growth remains uncertain, with the manufacturing PMI in China edging down to 49.4 in July [8]