Investment Rating - The investment rating for the company is "Buy" and is maintained [8]. Core Insights - The company reported a revenue of HKD 5.183 billion for FY2026H1, a year-on-year decrease of 12.9%. Gross profit was HKD 1.827 billion, down 20.1%, and net profit attributable to shareholders was HKD 571 million, a decline of 24.4%. The interim dividend per share remained flat at HKD 0.13 [2][6]. - The core operating business remains stable, although the installation, maintenance, and construction segments, along with property business, have seen declines, impacting overall profitability. The company has shown signs of a turning point in free cash flow, indicating potential for future dividend increases [2][9]. Business Segment Analysis - **Urban Water Supply**: Revenue decreased by 13.1% to HKD 3.27 billion, with segment profit down 17.4% to HKD 941 million. However, core water supply service revenue increased by 4.5% to HKD 1.801 billion, driven by a 5% increase in water sales. The completion of water price adjustments in eight cities is expected to further boost revenue and profit margins [9]. - **Direct Drinking Water**: Revenue fell by 28.3% to HKD 263 million, with segment profit declining 55.2% to HKD 75 million. Despite this, revenue from direct water supply operations and equipment sales remained stable [9]. - **Environmental Segment**: Benefiting from the Meifeng Wastewater Treatment Project, this segment achieved revenue of HKD 832 million, a year-on-year increase of 8.7%, with segment profit rising 29.7% to HKD 367 million [9]. - **General Contracting**: Revenue decreased by 6.1% to HKD 398 million, with segment profit down 60.2% to HKD 158 million [9]. - **Property Business**: Revenue plummeted by 93.3% to HKD 17 million, with segment profit dropping 96.4% to HKD 500,000, but the impact on overall performance is expected to be limited [9]. Financial Performance - The company experienced a 17.6% decrease in financial expenses during FY2026H1, benefiting from lower financing costs amid domestic and international interest rate cuts [9]. - The interim dividend payout ratio is 37%, with capital expenditures peaking at HKD 5.14 billion in FY2024, decreasing to HKD 3.24 billion in FY2025, leading to a positive free cash flow of HKD 150 million. For FY2026, capital expenditures are projected to be no more than HKD 2 billion, indicating a clear turning point in free cash flow and potential for increased dividends [9]. Earnings Forecast and Valuation - The company is expected to achieve net profits attributable to shareholders of HKD 1.14 billion, 1.16 billion, and 1.20 billion for FY2026-2028, with year-on-year growth rates of 6.0%, 2.2%, and 2.7% respectively. The emergence of free cash flow is viewed positively for future dividend increases, with a projected dividend payout ratio of 42.53% for FY2026-2028, corresponding to dividend yields of 5.1%, 5.2%, and 5.3% based on the stock price as of November 28, 2025 [9].

Investment Rating - The report initiates coverage on Weibo-SW (9898 HK) with an "Outperform" rating, targeting a price of HK$107.00 [2][12][26] Core Insights - Weibo maintains a unique position in the Chinese social media landscape, characterized by a large user base, rich social connections, and effective marketing solutions. The application of generative AI is expected to enhance monetization efficiency [3][20] - The company's Q3 2025 results showed mixed performance, with total revenue of US$442.3 million, a 5% year-over-year decline, and online advertising revenue down 6% in USD terms [21][9] - Management expresses confidence in achieving full-year profit targets and commits to annual shareholder returns, with a history of distributing approximately US$200 million in dividends each year [5][24][25] Financial Performance - For FY2025, total revenue is projected at US$1.725 billion, a 2% decrease from the previous year, with adjusted net profit expected to be US$461 million [10][17] - The gross profit margin is forecasted to be 76.5% in FY2025, with an adjusted operating profit margin of around 30% [17][24] - The report anticipates a gradual recovery in advertising revenue, particularly in Q4, supported by events like the Double 11 shopping festival [22][4] Business Outlook - Weibo's community engagement remains strong, with significant growth in user interaction metrics, indicating a solid foundation for future monetization [23][9] - The report highlights the resilience of certain sectors, such as e-commerce and automotive, while noting challenges in gaming and consumer electronics due to budget constraints [4][22] - The company is exploring new monetization channels, including membership services and content payment scenarios [9][10] Valuation Analysis - The report assigns a valuation multiple below the industry average, reflecting Weibo's stable user base and moderate growth phase. The target price is set at 8x FY26 PE [12][26] - Comparatively, Weibo's valuation metrics are positioned lower than those of other internet companies, indicating potential for upside as market conditions improve [12][13]

Investment Rating - The report initiates coverage on Baidu with an "OUTPERFORM" rating, indicating an expectation of performance exceeding the market average [1]. Core Insights - Baidu is focusing resources on the development and monetization of AI technologies, with AI-driven new business revenues growing by over 50% year-on-year, contributing 39% to core revenues [2][21]. - The Apollo Go business is expanding rapidly, with weekly fully driverless orders exceeding 250,000 and cumulative orders surpassing 17 million, indicating significant growth potential [3][22]. - Traditional advertising is under pressure, while cloud services continue to show strong growth, with expectations of a 14% decline in core advertising revenue and a 14% increase in cloud revenue in Q4 [3][24]. Financial Summary - Baidu's revenue for Dec-24 is projected at RMB 133,125 million, with a slight decline expected in subsequent years [17]. - Net profit is forecasted to decrease significantly in Dec-25 to RMB 18,707 million, before recovering in the following years [17]. - The gross profit margin is expected to decline from 50.3% in Dec-24 to 43.1% in Dec-25, with a gradual recovery anticipated thereafter [17]. Valuation and Price Target - The report employs a Sum-of-the-Parts (SoTP) valuation method, estimating a target price of HK$171 per share, corresponding to an 18x PE ratio for FY25 [4][25]. - Key components of the valuation include traditional search ads valued at US$2.2 billion, AI cloud services at US$3.5 billion, and Robotaxi at US$57.3 billion [4][25]. Business Segment Outlook - The traditional advertising segment is facing challenges, but the cloud business is expected to maintain high growth rates, driven by demand for large language models [10][24]. - AI-related businesses are being prioritized, with significant revenue growth reported in AI cloud infrastructure and AI-native marketing services [2][21][22].

研究报告 Research Report 30 Nov 2025 新东方-S New Oriental (9901 HK) 首次覆盖：多元化的教培龙头；目标 FY26 利润率提升；未来股东回报将进一步提升 A diversified education leader targeting FY26 margin expansion and higher shareholder returns ahead: Initiation [Table_yemei1] 观点聚焦 Investment Focus [Table_Info] 首次覆盖优于大市 Initiate with OUTPERFORM 评级 优于大市 OUTPERFORM 现价 HK$40.30 目标价 HK$49.00 HTI ESG 5.0-5.0-5.0 E-S-G: 0-5, (Please refer to the Appendix for ESG comments) 市值 HK$65.90bn / US$8.46bn 日交易额 (3 个月均值) US$29.15mn 发行股票数目 1,635mn 自由流通股 (%) 88% 1 年股价最高最低 ...

Investment Rating - The report maintains a "Strong Buy" investment rating for the company [3] Core Insights - The company reported a revenue of 35.55 billion yuan for Q3 2025, representing a year-on-year growth of 14.2%, exceeding Bloomberg's consensus estimate of 13.5% [1] - Adjusted net profit for Q3 2025 was 4.99 billion yuan, a year-on-year increase of 26.3%, also surpassing Bloomberg's consensus estimate of 22.4% [1] - The company's AI revenue exceeded 300 million yuan in Q3 2025, marking a continuous increase from 150 million yuan in Q1 and 250 million yuan in Q2 [1] Financial Data and Valuation - Total revenue projections for the company are as follows: 113.47 billion yuan in 2023, 126.90 billion yuan in 2024, 142.13 billion yuan in 2025E, 152.05 billion yuan in 2026E, and 160.66 billion yuan in 2027E, with year-on-year growth rates of 20%, 12%, 12%, 7%, and 6% respectively [2][11] - Adjusted net profit is projected to be 10.27 billion yuan in 2023, 17.72 billion yuan in 2024, 20.59 billion yuan in 2025E, 23.67 billion yuan in 2026E, and 26.74 billion yuan in 2027E, with significant growth rates [8][12] - The company has a total market capitalization of 295.7 billion HKD, with a current share price of 68.4 HKD [3] User Engagement and AI Integration - Daily Active Users (DAU) and Monthly Active Users (MAU) reached 416 million and 730 million respectively in Q3 2025, with year-on-year growth of 2.1% and 2.4% [7] - The average usage time per DAU was 134.1 minutes, indicating increased user engagement [7] - The AI-driven model OneRec has significantly improved user retention and engagement metrics [7] E-commerce Performance - E-commerce transaction volume and profitability exceeded expectations, with Q3 2025 GMV growing by 15.2% to 385 billion yuan [7] - Revenue from live streaming business was 9.57 billion yuan, showing a year-on-year growth of 2.5% [7] - The online marketing services revenue reached 20.1 billion yuan, a year-on-year increase of 14.0% [7] AI Commercialization - The company’s AI revenue has shown a steep growth trajectory, with Q3 2025 AI revenue exceeding 300 million yuan [7] - The introduction of the OneRec model has enhanced advertising matching efficiency and customer ROI [7] - The AI technology has contributed approximately 4%-5% to the online marketing revenue in Q3 2025 [7] Profitability and Financial Ratios - The adjusted PE ratio is projected to decrease from 26.0 in 2023 to 10.0 in 2027, indicating improving valuation metrics [12] - The company’s return on equity (ROE) is expected to stabilize around 20.6% in 2026 and 19.2% in 2027 [12]

Investment Rating - The report maintains a "Buy" rating for the company, expecting a price increase of over 15% in the next 6-12 months [5][12]. Core Insights - In Q3 2025, the company reported revenue of 95.5 billion yuan, a year-on-year increase of 2%. However, it faced a Non-IFRS net loss of 16 billion yuan, marking a shift from profit to loss compared to the previous year [2]. - The local core business revenue was 67.4 billion yuan, down 2.8% year-on-year, with an operating loss of 14.1 billion yuan, indicating a significant decline in profitability [3]. - New business revenue reached 28 billion yuan, reflecting a robust growth of 15.9% year-on-year, although it still incurred an operating loss of 1.3 billion yuan [4]. Financial Performance Summary - The company’s projected revenues for 2025, 2026, and 2027 are 364.1 billion yuan, 419.9 billion yuan, and 486.7 billion yuan, respectively. The Non-IFRS net profits are expected to be -18.1 billion yuan in 2025, 16.6 billion yuan in 2026, and 48.2 billion yuan in 2027 [5][10]. - The operating income growth rate is projected to be 7.88% in 2025, followed by 15.31% in 2026 and 15.91% in 2027 [10]. - The report indicates a significant improvement in operating efficiency and user engagement in the new business segments, particularly in grocery retail and international expansion [4].

Investment Rating - The report maintains a "Buy" rating for the company [6] Core Insights - The company reported a revenue of HKD 38.986 billion for FY2026H1, a decrease of 1.1% year-on-year, while the net profit attributable to shareholders was HKD 2.534 billion, an increase of 0.2% year-on-year [1] - In FY2026Q2, the sales growth turned positive, with a year-on-year increase of 4.1% [1] - The company plans to distribute an interim cash dividend of HKD 0.22 per share, resulting in a payout ratio of 85.7% [1] Summary by Sections Financial Performance - For FY2026H1, the revenue from priced jewelry increased by 9.3%, while the total revenue from gold jewelry and watches decreased by 3.8% and 10.6%, respectively [2] - The gross profit margin for FY2026H1 was 30.5%, down by 0.9 percentage points year-on-year, primarily due to the timing of gold price increases [4] - The company’s operating income for FY2026 is projected to be HKD 90.859 billion, with a net profit of HKD 8.131 billion, reflecting a growth rate of 37.45% [5] Market Segments - The revenue from the mainland China market accounted for 82.6% of total revenue, with a year-on-year decline of 2.5% [2] - The Hong Kong, Macau, and other markets showed a revenue increase of 6.5% in FY2026H1, with same-store sales growth of 4.4% [3] Sales Channels - The company’s retail revenue grew by 8.1% year-on-year, while franchise revenue declined by 10.2% [2] - Same-store sales in the mainland China market increased by 4.8% for franchises and 2.6% for direct sales [2] Profitability and Valuation - The report projects an increase in net profit for FY2026, FY2027, and FY2028 by 17.4%, 16.1%, and 16.0%, respectively, with corresponding EPS of HKD 0.82, 0.91, and 0.97 [4] - The current stock price corresponds to a price-to-earnings ratio of 17 for FY2026, 15 for FY2027, and 14 for FY2028 [4]

Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for its stock performance in the near term [6]. Core Insights - The company has demonstrated consistent profit growth exceeding revenue growth for eight consecutive years, showcasing its operational excellence and resilience [6]. - For the first half of FY2025/26, the company reported a revenue increase of 1.4% to 8.93 billion RMB and a net profit increase of 5.3% to 1.19 billion RMB, aligning with expectations [6][10]. - The company continues to focus on its core business of down jackets, with the main brand experiencing an 8.3% revenue growth, contributing significantly to total revenue [6]. - The company is actively expanding its retail network, with a net increase of 88 stores, bringing the total to 3,558 [6]. Financial Data and Profit Forecast - Revenue projections for FY2024 to FY2028 are as follows: - FY2024: 23.214 billion RMB - FY2025: 25.902 billion RMB - FY2026E: 28.465 billion RMB - FY2027E: 31.272 billion RMB - FY2028E: 34.210 billion RMB - The expected net profit for the same period is: - FY2024: 3.074 billion RMB - FY2025: 3.514 billion RMB - FY2026E: 3.899 billion RMB - FY2027E: 4.340 billion RMB - FY2028E: 4.754 billion RMB - The company’s gross margin is projected to remain stable, with slight fluctuations, and the net profit margin is expected to improve gradually [5][15].

Investment Rating - The report maintains a "Buy" rating for the company [2] Core Insights - The company reported a 1.4% year-on-year increase in revenue to 8.93 billion RMB for the first half of FY2025/26, with a net profit growth of 5.3% to 1.19 billion RMB, indicating a consistent high-quality growth trend [7] - The company has achieved eight consecutive years of profit growth outpacing revenue growth since its strategic transformation in 2018, showcasing strong operational quality and resilience [7] - The main business segment, down jackets, showed robust growth with an 8.3% increase in revenue to 6.57 billion RMB, accounting for 73.6% of total revenue [7] - The company has a strong retail network expansion, with self-operated and franchise revenues growing by 6.6% and 7.9% respectively [7] Financial Data and Profit Forecast - Revenue projections for FY2024 to FY2028 are as follows: 23.21 billion RMB, 25.90 billion RMB, 28.47 billion RMB, 31.27 billion RMB, and 34.21 billion RMB, with corresponding growth rates of 38%, 12%, 10%, 10%, and 9% [6] - Net profit forecasts for the same period are: 3.07 billion RMB, 3.51 billion RMB, 3.90 billion RMB, 4.34 billion RMB, and 4.75 billion RMB, with growth rates of 44%, 14%, 11%, 11%, and 10% [6] - The company’s gross margin is projected to be around 57.5% to 59.6% over the forecast period [6] Operational Efficiency - The company has significantly improved its operational efficiency, with inventory turnover days reduced by 11 days to 178 days compared to the previous year [7] - Cash and cash equivalents reached approximately 3 billion RMB, with net cash increasing by 38.8% year-on-year to about 10.3 billion RMB [7]

Investment Rating - The report maintains a "Buy" rating for the company [7]. Core Views - The company is expected to achieve a revenue CAGR of over 10% from 2025 to 2026, driven by improving trends among core customers such as Nike, Uniqlo, and Adidas [1][15]. - The company has a solid fundamental base and is positioned to benefit from the recovery of core customer orders, leading to a phase of capacity-driven growth and improved profitability quality [2][20]. Summary by Sections Market Overview - The company is one of the largest integrated knitwear manufacturers in Asia, with a strong market position and a history of stable growth [14]. - Recent fluctuations in customer orders have been addressed through long-term asset investments and capacity expansion [2]. Customer Trends - Core customers like Nike and Uniqlo are showing positive trends, with Nike's inventory in North America returning to normal levels, which is expected to enhance order volumes [1][15]. - Adidas and Fast Retailing (Uniqlo's parent company) are also performing well, with Adidas showing strong growth across various regions [15][26]. Capacity and Production - The company has consistently invested in capacity expansion, with a projected employee count of 110,000 by mid-2025, reflecting a 9% year-on-year increase [2]. - The integrated supply chain is expected to enhance competitive advantages, particularly with over 50% of production capacity located in Vietnam and Cambodia [2]. Revenue and Profitability Forecast - Revenue projections for 2025, 2026, and 2027 are estimated at 316.1 billion, 351.5 billion, and 390.7 billion CNY, respectively, with year-on-year growth rates of 10.3%, 11.2%, and 11.1% [4]. - Gross margins are expected to improve gradually, with estimates of 27.4%, 28.2%, and 28.3% for the same years [4]. Investment Recommendations - The company's stock price is currently trading at a PE ratio of 12.4 for 2026, with a target PE of around 15, indicating a potential upside of approximately 20% [5][20]. - The report emphasizes the potential for valuation improvement as core customer orders stabilize and profitability quality enhances [5][20].