Investment Rating - The report maintains a "Buy" rating for ZTO Express (02057) with a target price not specified [5][4]. Core Views - The report highlights that if domestic demand is stimulated, the volume of express deliveries is expected to see significant growth, particularly in the second half of 2025, potentially exceeding the growth seen in 2019 [2]. - The express delivery prices have seen a significant decline, with a year-on-year drop of 18% as of February 2025. However, this decline is expected to narrow if demand increases and competition eases, which would improve profitability for express companies [3]. - The report has adjusted the profit forecast for ZTO Express, lowering the expected net profit for 2025-2026 to 10.4 billion and 11.7 billion yuan respectively, down from previous estimates of 12.1 billion and 14.4 billion yuan [4]. Summary by Sections Market Conditions - The express delivery industry has benefited from the expansion of domestic demand, particularly in online retail, following the imposition of tariffs on Chinese goods by the U.S. in 2018-2019 [1]. - The anticipated increase in domestic demand due to higher tariffs on Chinese exports to the U.S. in 2025 is expected to further boost express delivery volumes [2]. Financial Performance - The report projects a recovery in net profit growth for leading express companies, including ZTO Express, from late 2018 to late 2019, following a period of declining prices [1]. - The adjusted profit forecasts for ZTO Express reflect the impact of unexpected price declines on profit margins [4]. Price Trends - The report notes that the current express delivery price decline is at a historically high level, but future price competition may ease, leading to improved profitability for express delivery companies [3].
中通快递-W：若提振内需，量价有望上行-20250410