Investment Rating - The report maintains a positive outlook on the company, suggesting continued active monitoring of its performance and potential growth opportunities [15]. Core Insights - The company achieved total revenue of 92.5 billion RMB in Q3 2024, representing a year-on-year growth of 30.5%, with adjusted net profit reaching 6.3 billion RMB, up 4.4% year-on-year [4]. - The smartphone business continues to strengthen, with revenue of 47.5 billion RMB in Q3 2024, a 13.9% increase year-on-year, and a market share of 13.8% globally [7]. - The IoT and lifestyle products segment saw revenue growth of 26.3% year-on-year, reaching 26.1 billion RMB, with a record high gross margin of 20.8% [11]. - The electric vehicle segment reported revenue of 9.7 billion RMB in Q3 2024, a 52.3% increase from the previous quarter, with a gross margin of 17.1% [13]. Summary by Sections Smartphone Business - The company sold 43.1 million smartphones in Q3 2024, a 3.1% increase year-on-year, with an average selling price (ASP) of 1,102 RMB, up 10.6% [7]. - The company ranked third globally in smartphone shipments for 17 consecutive quarters, with a market share increase in mainland China to 14.7% [7]. IoT and Lifestyle Products - The company achieved a record high of 6.86 million monthly active users globally, a 10.1% increase year-on-year, with significant growth in air conditioning, refrigerator, and washing machine sales [11]. - Internet services revenue reached 8.5 billion RMB in Q3 2024, with a gross margin of 77.5%, up 3.1 percentage points year-on-year [11]. Electric Vehicle Segment - The company delivered 39,790 units of the Xiaomi SU7 in Q3 2024, with an average price of 238,650 RMB per unit, and expects to exceed 20,000 units in monthly deliveries post-October [13]. - The upcoming Xiaomi SU7 Ultra is priced at 817,900 RMB, with significant pre-orders indicating strong market interest [13].

Investment Rating - The report maintains a "Buy" rating for Geely Auto (0175 HK) [6] Core Views - Geely Auto is entering a new product cycle driven by its GEA platform, with strong growth potential in its new energy vehicle (NEV) brands including Zeekr, Lynk & Co, and Galaxy [2][3] - The company's NEV transformation is accelerating, with significant cost reductions and improved profitability expected due to economies of scale and product structure optimization [2][3] - Geely's traditional fuel vehicle business remains stable, supported by innovative overseas expansion models through joint ventures [3][5] Business Segments New Energy Vehicles (NEVs) - The GEA platform is enabling a strong product cycle for Geely's NEV brands, with significant cost reductions and improved energy efficiency [4] - Galaxy: The Galaxy E5, the first model on the GEA platform, has delivered 40,000 units in 85 days, with strong pricing and product competitiveness [4] - Zeekr: Positioned in the high-end pure electric market, Zeekr 001 and 007 are driving sales, with Zeekr 009 exceeding expectations in profitability [4] - Lynk & Co: The brand is transitioning from fuel to NEVs, with models like Lynk & Co 08 EM-P and Lynk & Co 07 boosting sales [4] Traditional Fuel Vehicles - Geely's fuel vehicle business remains strong, with a competitive edge in the 8-200,000 RMB price segment [5] - The company is expanding its overseas market presence through joint ventures, such as its collaboration with Volvo and Renault, and the acquisition of Proton in Southeast Asia [5] - Overseas fuel vehicle gross margins are significantly higher than domestic margins, providing additional profit potential [5] Financial Performance - In the first three quarters of 2024, Geely's revenue reached 1677 billion RMB, a 36% YoY increase, with net profit attributable to shareholders (excluding Renault impact) at 53.9 billion RMB, up 894% YoY [3] - The company's gross margin and net margin improved YoY, driven by economies of scale and product structure optimization [3] Future Outlook - Geely is expected to see strong growth in 2024-2026, with net profit forecasts of 160 billion, 118 billion, and 157 billion RMB, respectively [5] - The GEA platform will continue to drive the company's NEV transformation, with a focus on hybrid and electric vehicles entering a volume expansion phase [5]

Investment Rating - The report maintains a "Recommended" rating for the company, indicating a positive outlook for the stock performance over the next six months [4][19]. Core Insights - The company reported a revenue of 10.1 billion yuan for Q3 2024, with a quarter-on-quarter growth of 18.4% and a year-on-year growth of 24.5%. The loss for the quarter was 1.81 billion yuan, which represents a year-on-year reduction of 53.5% but a quarter-on-quarter increase of 40.7% [10]. - The company has improved its gross margin to 15.3% in Q3 2024, driven by cost reduction efforts and an increase in the sales proportion of higher-margin models [11]. - The company plans to enter a strong product cycle in 2025, with at least four new models expected to be launched, including an extended-range vehicle that enhances user appeal [14]. Financial Performance Summary - For 2023, the company achieved a revenue of 30.68 billion yuan, with a projected revenue of 41.35 billion yuan for 2024, reflecting a year-on-year growth rate of 34.8% [9][17]. - The net profit for 2024 is projected to be a loss of 6.09 billion yuan, improving to a profit of 1.4 billion yuan by 2026 [9][17]. - The gross margin is expected to improve from 1.5% in 2023 to 14.1% in 2024, with a further increase to 17.6% by 2026 [9][17]. Sales and Delivery Insights - The company delivered 46,533 vehicles in Q3 2024, marking a year-on-year increase of 16.3% and a quarter-on-quarter increase of 54.0% [10]. - The sales revenue from automotive sales reached 8.8 billion yuan in Q3 2024, with an average revenue per vehicle of 189,000 yuan, which saw a decline of 3,700 yuan quarter-on-quarter [10]. Market Position and Strategy - The introduction of two popular models, M03 and P7+, is expected to help the company recover from previous sales challenges and improve market positioning [11][14]. - The company is focusing on enhancing its technological capabilities and expanding its product offerings to capture a broader customer base [14].

Investment Rating - The investment rating for the company is "Buy" (maintained) [2] Core Views - The sustained momentum in the automotive sector and the high-end product strategy are expected to enhance the company's core profit and valuation [2] - Adjusted net profit estimates for 2024-2026 have been raised to 24.4 billion, 31.9 billion, and 43 billion respectively, reflecting year-on-year growth rates of 26%, 31%, and 35% [6] - The current stock price of HKD 28.3 corresponds to a PE ratio of 27.2, 20.7, and 15.4 for 2024-2026, indicating strong cash flow from core profits [6] Financial Performance Summary - In Q3 2024, adjusted net profit was 6.3 billion, a 4% year-on-year increase, with automotive losses narrowing to 1.5 billion [7] - Smartphone shipments increased to 43.1 million with a gross margin of 11.7% [7] - IoT revenue reached 26.1 billion with a gross margin of 20.8%, driven by a higher proportion of high-margin products [7] - Internet revenue was 8.5 billion, with a slight decline in gross margin to 77.5% due to reduced advertising margins [7] - Automotive sales approached 40,000 units, with an average selling price (ASP) increasing by 10,000 to 239,000, and a gross margin improvement to 17.1% [7] Future Outlook - For Q4 2024, adjusted net profit is projected at 5.4 billion, an 11% year-on-year increase, with core profit expected to be 6.5 billion [8] - The company anticipates smartphone shipments of approximately 170 million units in 2024, with ASP and gross margin expected to improve due to higher-end models and stabilized storage prices [8] - IoT revenue is expected to see slight growth in Q4 2024, benefiting from promotional activities and national subsidies [8] - The automotive segment aims for a target of 130,000 units in 2024, with Q4 shipments projected at 63,000 units, and ASP expected to rise due to the cancellation of equity incentives [8] Key Financial Metrics - Revenue for 2024 is estimated at 358.5 billion, with a year-on-year growth of 32.3% [10] - Net profit for 2024 is projected at 24.4 billion, reflecting a year-on-year increase of 26.4% [10] - Gross margin is expected to stabilize around 21% for the coming years [10] - The company’s return on equity (ROE) is forecasted to reach 12.9% in 2024, increasing to 18.1% by 2026 [10]

20 Nov 2024 CMB International Global Markets | Equity Research | Company Update Tongcheng Travel (780 HK) Travel demand remains resilient Tongcheng Travel (TC) reported 3Q24 results: total revenue was RMB5.0bn, up 51% YoY (2Q24: +48% YoY), 3% better than Bloomberg consensus estimates; adjusted net income was RMB910mn, up 47% YoY, 11% better than consensus. OPM of core OTA businesses improved to 31.1% in 3Q24 (3Q23: 25.2%), driven by optimization of marketing strategies. Booking volume growth of TC's transpo ...

Investment Rating - The report maintains a "Buy" rating for the company, Trip.com Group (9961 HK), with a target price raised to HKD 605.00, indicating a potential upside of 26.5% from the current price of HKD 478.20 [1][5][12]. Core Insights - The company's hotel business has performed better than expected, and the transportation segment is returning to normal growth, leading to an upward revision of revenue forecasts for 2024 and 2025 by 4% and 6% respectively. Trip.com is expected to continue contributing to revenue growth, with manageable investments and losses [1][2]. - The company reported a revenue of RMB 15.9 billion for Q3 2024, a year-on-year increase of 16%, surpassing market expectations. The growth was driven by accommodation (+22%), transportation (+5%), vacation (+17%), and business travel (+11%) segments [2][6]. - Adjusted net profit for Q3 2024 reached RMB 6 billion, a 22% increase year-on-year, exceeding expectations due to optimized cross-selling and effective cost control [2][6]. Financial Forecasts - Total revenue projections for 2024E have been updated to RMB 52.93 billion, reflecting an 18.8% growth rate, while 2025E revenue is forecasted at RMB 60.6 billion, a 14.5% growth rate [4][17]. - The adjusted operating profit for 2024E is expected to be RMB 16.08 billion, with an operating profit margin of 30.4% [4][17]. - The adjusted net profit for 2024E is projected at RMB 17.84 billion, with a net profit margin of 33.7% [4][17]. Performance Metrics - The company has shown a strong recovery in its hotel and transportation segments, with the average daily rate (ADR) pressure easing and outbound travel bookings recovering to 120% of 2019 levels [2][6]. - Marketing expenses have increased by 23% year-on-year, but remain stable as a percentage of revenue at 21% [2][6]. - The company’s gross profit margin is projected to be 81.5% for 2024E, slightly down from 81.7% in the previous forecast [4][17].

Investment Rating - Buy (首次评级) [3][6] Core Views - Cathay Pacific is a global airline with a strong presence in Hong Kong and the Greater Bay Area, operating both passenger and cargo services globally [3] - The company is expected to benefit from the recovery of international air travel, particularly from transit passengers from mainland China [5] - Cathay Pacific is well-positioned to capitalize on the long-term structural changes in the aviation industry, including the reopening of polar routes and the competitive advantage in long-haul routes [5] - The company is entering a new phase of growth starting in 2025, driven by the normalization of travel demand and the expansion of Hong Kong International Airport's third runway system [5] Business Overview Passenger Business - Cathay Pacific's passenger business has shown strong recovery post-pandemic, with passenger volume rebounding significantly in 2023 and continuing to grow in 2024 [4] - The company's passenger load factor and revenue per passenger kilometer (RPK) have improved, although ticket prices are expected to decline slightly as capacity increases [4] - Cathay Pacific is expected to maintain high ticket prices due to the supply-demand imbalance, with passenger demand still being released gradually [4] Cargo Business - Cathay Pacific is a leading player in the global air cargo market, with significant capacity deployed in Northeast Asia and North America [3] - The company's cargo business has remained strong, with cargo yields staying above pre-pandemic levels [4] - The company is expected to continue increasing cargo capacity, leveraging Hong Kong's position as a global air cargo hub [4] Financial Performance and Valuation - Cathay Pacific's net profit is expected to decline to HKD 7.133 billion in 2024 but rebound to HKD 9.008 billion and HKD 10.82 billion in 2025 and 2026, respectively [6] - The company's ROE is projected to reach 10.9%, 12.6%, and 13.7% in 2024, 2025, and 2026, respectively [6] - Based on the PB-ROE valuation model, the target PB ratio for 2025 is 1.1-1.2x, implying a valuation range of HKD 78.7-85.8 billion, representing an upside potential of 37-50% [6] Strategic Advantages - Cathay Pacific benefits from its dominant position in Hong Kong's aviation market, with a market share of over 55% [102] - The company is expected to gain from the expansion of Hong Kong International Airport's third runway system, which will significantly increase capacity and open up new growth opportunities [104] - Cathay Pacific's extensive global network and focus on international routes position it well to benefit from the recovery of long-haul travel and the competitive advantages in the post-pandemic aviation landscape [5] Industry Outlook - The global aviation industry is expected to see a recovery in passenger demand, particularly in international travel, with Cathay Pacific well-positioned to benefit from this trend [5] - The air cargo market remains strong, with global demand for air freight continuing to grow, providing further growth opportunities for Cathay Pacific [132] - The long-term growth of the Greater Bay Area and the expansion of infrastructure in the region will further support Cathay Pacific's growth, particularly in the cargo segment [112]

Investment Rating - The investment rating for the company is "Buy" and is maintained [5] Core Views - The launch of the Xiaopeng P7+ on November 7 marks the beginning of the AI automotive era, with a starting price of 186,800 RMB, significantly exceeding expectations and positioning it as a new blockbuster [2][6] - The P7+ is available in three versions: Long Range, Ultra Long Range, and Limited MAX Edition, priced at 186,800, 198,800, and 218,800 RMB respectively, with an initial release of 500 units available for immediate delivery [2][6] - The company is expected to accelerate sales growth due to the new vehicle cycle initiated by the launch of MONA on August 27 and the P7+, alongside channel transformation and enhanced marketing systems [8] Summary by Sections Event Description - The Xiaopeng P7+ was officially launched on November 7, with a starting price of 186,800 RMB and three versions available, including a limited edition with 500 units for immediate delivery [6][7] - The vehicle features a spacious design with C-class dimensions and D-class space, offering a luxurious and intelligent driving experience [6] Event Commentary - The P7+ combines technology and aesthetics, featuring a drag coefficient of only 0.206Cd and a spacious interior with a maximum trunk capacity of 725L, expandable to 2221L [6][7] - It is equipped with a single motor version providing a maximum power of 180kW/230kW and offers two battery options with ranges of 620km and 710km [6][7] Sales and Financial Outlook - The pricing of the P7+ is significantly lower than the expected price of 209,800 RMB and competes favorably against similar models, enhancing its market position [7] - The company anticipates a revenue of 42.7 billion RMB in 2024, reflecting a substantial improvement in financial performance driven by software revenue and the new vehicle cycle [8]

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 46.83 HKD per share, compared to the current price of 40.80 HKD [5]. Core Insights - The company has received acceptance for the NDA of APG-2575, a novel Bcl-2 inhibitor for treating R/R CLL/SLL, which is the first domestically submitted NDA for a Chinese-origin Bcl-2 inhibitor and is expected to be the second Bcl-2 inhibitor globally to be launched [3][4]. - APG-2575 is positioned as a revolutionary therapy for CLL/SLL, with ongoing clinical trials that include multiple Phase III studies for various combinations and indications [3]. - The company is also pursuing new indications for its existing drug, Nilotinib, which is expected to be included in medical insurance negotiations, potentially leading to faster market penetration [3]. Financial Summary - The company's revenue projections for 2024-2026 are 1.013 billion, 609 million, and 1.074 billion RMB, respectively, indicating a significant growth rate of 356.5% in 2024, followed by a decline in 2025 and a recovery in 2026 [4]. - The EBITDA is projected to improve from -144 million RMB in 2024 to -304 million RMB in 2026, reflecting ongoing operational challenges [4]. - The net profit attributable to shareholders is expected to improve from -286 million RMB in 2024 to -469 million RMB in 2026, indicating a gradual recovery in profitability [4].

Investment Rating - The report maintains a "Buy" rating for Alibaba [4][6]. Core Views - Alibaba's revenue for the second quarter of fiscal year 2025 (ending September) was 236.5 billion yuan, representing a year-on-year growth of 5%. Key segments such as Taobao, International Commerce, Local Services, Cainiao, Cloud Intelligence, and Digital Entertainment generated revenues of 99 billion, 31.7 billion, 17.7 billion, 24.6 billion, 29.6 billion, and 5.7 billion yuan respectively, with growth rates of 1%, 29%, 14%, 8%, 7%, and -1.5% [2][3]. - The adjusted EBITA for the quarter was approximately 40.6 billion yuan, down 5% year-on-year, with an EBITA margin of about 17%. The adjusted EBITA margins for the segments were 45%, -9%, -2%, 0%, 9%, and -3% respectively [2][3]. - Non-GAAP net profit for the quarter was 36.4 billion yuan, a decline of 9% year-on-year [2]. Summary by Sections Taobao - Taobao is still in an investment phase, with customer management revenue growing by 2% year-on-year, primarily due to the increase in e-commerce GMV. The monetization rate is positively impacted by the penetration of the "full-site promotion" tool and the introduction of a 0.6% technical service fee starting in September [2][3]. Cloud Intelligence - Cloud revenue reached 29.6 billion yuan, growing by 7% year-on-year, with public cloud revenue showing double-digit growth. AI-related product revenue has seen triple-digit growth for five consecutive quarters. The adjusted EBITA margin for cloud services improved to 9.0% [3]. Financial Projections - Revenue projections for Alibaba for fiscal years 2025 to 2027 are estimated at 1,010.9 billion, 1,113.9 billion, and 1,214.4 billion yuan respectively, with non-GAAP net profits projected at 160 billion, 183 billion, and 206 billion yuan [4][5]. - The report anticipates a P/E ratio of 10x for core e-commerce, 3x for cloud computing, and 2x for digital entertainment and other businesses, leading to a target price of 114 HKD for the Hong Kong stock and 116 USD for the US stock [4].