8 August 2024 | 12:50PM CST _ China Tower Corp. (0788.HK): 1H24 net profit largely in line; first interim dividend announced and a turnaround in FCF; Neutral We see encouraging signs from 1H24 results, including: 1) the announcement of an interim dividend for the first time; 2) a turnaround in free cash flow as previously guided; 3) a net debt decline resulting from cash flow improvements; and 4) net profit is largely in line. Additionally, management provided a more detailed guidance for 2024, including: 1 ...

Investment Rating - The report assigns a Buy rating to Kweichow Moutai with a 12-month price target of Rmb2,098 [3][4] Core Investment Thesis - Kweichow Moutai is the largest player in the China spirits industry with a 20% value share in 2022 [3] - The company benefits from strong fundamentals, high visibility, and upside from channel reforms [3] - Near-term earnings drivers include wholesale and direct sales growth, product portfolio enhancement, and price hikes [3] - Long-term growth is supported by supply-demand gap, market-driven pricing system, and growth of Moutai-flavor spirits [3] Financial Performance and Estimates - 2Q24 revenue was Rmb37.0bn, up 17% YoY, with net profit of Rmb17.6bn, up 16.1% YoY [35][55] - Moutai Spirits revenue grew 13% YoY to Rmb28.9bn, while Series spirits revenue accelerated to 43% YoY at Rmb7.2bn [35][36] - i-Moutai generated Rmb4.91bn in spirits sales in 2Q24, up 11% YoY, exceeding expectations [55] - The company aims for a 75% dividend payout ratio for 2024-26, implying total shareholder return of Rmb219bn [56] Valuation and Price Target - The 12-month price target of Rmb2,098 is based on a 29.4x 2026E P/E, discounted back to 2024E year-end using a 9.8% CoE [4] - The target P/E includes a 40% premium for Moutai's leading position in China's spirits industry and strong returns profile [4] - Moutai is trading at 21x/18x 2024E/2025E P/Es with a 12% earnings CAGR in 2024E-26E [63] Product and Channel Performance - Wholesale channel sales grew 27% YoY in 2Q24, supported by a price hike in November 2023 [55] - Direct sales grew 6% YoY in 2Q24, contributing 40% of total spirits sales [55][59] - i-Moutai contributed 14% of total sales in 2Q24, with 531k bottles released in July, down 60% YoY [60] Market Trends and Pricing - Feitian Moutai's wholesale price increased by Rmb180 for original case and Rmb130 for unpacked bottles in July [78] - Channel inventory stands below 1 month, with shipments expected to increase for the Mid-Autumn Festival [78] - Non-standard SKUs like Jingpin and Zodiac Moutai maintain decent channel profitability [79] Production and Supply - Base spirits production volume declined YoY in 1H24, with Moutai base spirits down 12.3% and Series base spirits down 5.4% [60] - The company has implemented active shipment controls, particularly for Moutai 1935 and Zodiac (500ml) [60]

M Update Consumer Staples | Europe August 8, 2024 06:37 AM GMT Commodity Cost Tracker - July 2024 Key Takeaways MS Consumer Staples Commodity Cost Index was up +9.3% y/y in July 2024 vs +11.3% y/y in June 2024 Our index was down -2.4% m/m, driven primarily by a moderation in cocoa and energy prices Excluding the Chocolate companies, our Staples Commodity Cost index was up +1% y/y and flat on a m/m basis MS Consumer Staples Commodity Cost Index is up +9.3% on a y/y basis, but - 2.4% m/m in July due to a mode ...

Stock Market A-Share Market Strategy Weekly Wait and See August 11th, 2024 Strategy Research Team: FANG Yi (analyst) GUO Yinhan (assistant) MA Haoran (analyst) 021-38031658 021-38031681 021-38031560 fangyi020833@gtjas.com guoyinhan026925@gtjas.com mahaoran027837@gtjas.com S0880118080080 S0880122080038 S0880523020002 Summary: ● It is advisable to stand by, for the time being. During the sideway corrections of A-share market in the past two weeks, low-valuation sectors and thematic stocks outperformed market ...

9 August 2024 | 8:21PM HKT Asia Credit Trader Decompression Creates Opportunities in Asia HY; Focus on Rate Cuts, Not on Recession The path of Asia credit spreads followed the macro markets over the past week, with spreads under pressure at the start of the week, but rebounding later in the week as macro concerns subside. That said, despite the very sharp increase in equity volatility, there were no signs of panic amongst Asia credit investors, and market activity was relatively muted. Upcoming macro data w ...

Financial Derivatives August 12, 2024 Morning Insight: August 12, 2024 Linlin Gao Certification：Z0002332 gaolinlin@gtjas.com Yu Chen Wu (Contact) Certification：F03133175 wuyuchen028987@gtjas.com Main Body Commodity Market Insight： PX (Paraxylene): The correction phase has temporarily ended, with a short-term bottoming out and rebound expected. A SEP-JAN spread strategy is recommended, though the medium-term outlook remains weak. 1.) Last week, crude oil prices were the first to stabilize, but weak demand in ...

12 Aug 2024 CMB International Global Markets | Equity Research | Company Update Hua Hong Semi (1347 HK) Slowly but surely, gradual recovery is in play Hua Hong Semi announced 2Q24 results. Revenue was down 24.2% YoY but up 4.0% QoQ to US$479mn, slightly missing Bloomberg consensus by 2.0% and our estimates by 1.6%. The moderate sequential growth was a result of growing wafer shipments (+8.4% QoQ) partially offset by continued downward ASP (-3.5% QoQ). GPM increased QoQ to 10.5% (vs. 6.4%/27.7% in 1Q24/2Q23) ...

12 Aug 2024 CMB International Global Markets | Macro Research | Economic Perspectives China Economy Deflation alleviated, yet demand remains soft CPI growth rebounded and beat market expectations in July as food price notably surged amid supply disruptions caused by high temperature and flooding in some regions. Consumer demand remained soft as core CPI growth declined. Tourism service price sharply rebounded amid vigorous travel demand in the summer holiday, but vehicle and clothing prices continued to dec ...

Sydney CBD Office State of the Market Prime yields stable for first time since early 2022 02 2024 • Prime net face rents rose by 2.1% in Q2, led by the Midtown precinct with 3.6% growth. Meanwhile, incentives rose from 35% to 36%, largely offsetting the impact on effective rents, which edged up by 0.3%. • Tenant demand has been driven by professional and financial services contributing 67% of leasing activity. Activity has been weighted towards the core precinct, accounting for 76% of lease volumes in H1 20 ...

Industry Investment Rating - The report maintains an "Outperform" rating for Onto Innovation (ONTO US) and raises the target price by 6% [3] - Array Technologies (ARRY US) maintains an "Outperform" rating but cuts the target price by 6% due to project delays [3] - Bloom Energy (BE US) maintains an "Outperform" rating with strong execution and confidence in FY2024 guidance [4] - Quanta Services (PWR US) maintains an "Outperform" rating but cuts the target price by 6% [5] - Wharf Holdings (4 HK) is upgraded from "Underperform" to "Neutral" and raises the target price by 30% [7] Core Views - Onto Innovation is expected to benefit from GAA adoption and CoWoS/HBM expansion, with revenue forecasted to grow 31.9% YoY in 2025 [3] - Array Technologies faces significant project delays, leading to a 30-40% reduction in FY2024 guidance [3] - Bloom Energy has strong execution and expects larger business share in H2 2024, with data center-related power capacity agreements exceeding 300MW [4] - Quanta Services shows double-digit growth in multiple indicators in Q2 2024, driven by renewable generation and power grid infrastructure updates [5] - Wharf Holdings sees better recovery prospects in Hong Kong compared to Mainland China, with underlying profit up 9% YoY [7] Sector Summaries Technology - Onto Innovation's GAA orders are accelerating, with GAA expected to represent 50%/70% of advanced logic revenue in Q3/Q4 2024 [3] - Array Technologies' Q3 2024 revenue guidance is significantly below consensus due to project delays, with a backlog of over $2 billion [3] - Bloom Energy's Q2 2024 revenue exceeded expectations, driven by strong performance in product and service segments [4] Energy - Quanta Services' Electric Power Infrastructure segment performed well in Q2 2024, with a backlog of $17.2 billion, driven by AI adoption [5] - Bloom Energy continues to focus on domestic markets, with 83% of Q2 2024 revenue coming from domestic sales [5] Real Estate - Wharf Holdings' revenue from investment properties declined 5% YoY, with contracted sales in Mainland China dropping 48% YoY [7] - The company's gearing ratio remains low at 6.2%, with average interest costs declining from 4.9% in H1 2023 to 3.9% in H1 2024 [7] Financials - The report highlights the importance of building a financial system that supports technological innovation, with a focus on early-stage and long-term investments [11][12] - The Chinese government is accelerating the construction of a financial system that aligns with technological innovation, emphasizing the need for diversified financial services [11][12] Healthcare IT - Medical IT orders in Q2 2024 showed significant growth, with large orders frequently appearing, driven by policy support for healthcare informatization [16] - The "Public Medical Institutions Economic Management Year" activity is expected to further boost medical IT construction [16] Low-altitude Economy - Local governments in China are actively promoting the low-altitude economy, with Shenzhen aiming to build over 1,000 low-altitude aircraft takeoff and landing points by the end of 2025 [15] - Shanghai plans to develop a low-altitude economy industrial system, with a core industry scale exceeding 50 billion yuan by 2027 [15]