Shenwan Hongyuan Securities·2025-08-15 08:15Investment Rating - The report indicates a positive outlook for the express delivery industry, suggesting a potential recovery in pricing and profitability, with specific recommendations for companies like Shentong Express, YTO Express, and Jitu Express [3][66]. Core Insights - The current market dynamics are characterized by a recovery in express delivery prices, driven by both top-down and bottom-up pressures for price increases, indicating a shift away from intense price competition [3][66]. - The report outlines three scenarios for the future of the industry: 1) elimination of price disparities leading to sustained profit recovery and significant dividends; 2) continuation of competitive dynamics with increased industry fragmentation; 3) potential for higher-level mergers and acquisitions to optimize supply-side dynamics [39][66]. Summary by Sections Market Dynamics - The express delivery sector is experiencing a recovery phase, with significant price increases observed in regions like Guangdong and Yiwu, reflecting a commitment to eliminate price disparities [3][66]. - The report highlights that the express delivery price is a crucial driver of stock performance, with public fund holdings previously at low levels [6][66]. Company Recommendations - Recommended companies include Shentong Express for its high volume growth and profit improvement potential, YTO Express for its clear strategy and digital transformation, and Jitu Express for benefiting from high growth in Southeast Asian e-commerce [66]. - Zhongtong Express is noted for its market share recovery and profit rebound potential, while Yunda Express is recognized for its stable operations and improving network health [66]. Pricing Strategies - The report discusses the complexity of pricing policies in the express delivery sector, emphasizing the need for effective management of pricing strategies to maintain network stability and profitability [17][24]. - It also mentions that the stability of delivery fees is critical for the development of the industry, as it directly impacts the income of delivery personnel and overall service quality [30][32]. Future Outlook - The express delivery industry is expected to evolve towards a model resembling public utilities, with stable profits and cash flows leading to increased dividend payouts [43][66]. - The report suggests that the industry may see a shift from a consumer-driven PE valuation to a dividend yield-based valuation as profitability stabilizes [43][66].