Investment Rating - The industry investment rating is "Recommended" [2] Core Viewpoints - Continuous efforts to combat "involution" in the aviation industry are underway, with expectations for ticket prices to stabilize and improve [9] - The demand side remains resilient due to endogenous growth in domestic demand and ongoing recovery in international routes [9] - Supply constraints are expected to persist, and a decrease in oil prices will alleviate cost pressures [9] - Positive outlook on domestic regional market leader Huaxia Airlines and low-cost airline leader Spring Airlines, which leverage their core competitiveness to optimize "traffic-cost-price" dynamics [9] - Anticipation of elasticity release from major airlines represented by Air China, with a favorable recovery in international routes and efficient operation of wide-body aircraft expected to benefit Juneyao Airlines [9] Summary by Sections 1. Airline Data Analysis for July - In July, the overall ASK (Available Seat Kilometers) growth rates were led by Spring Airlines (10.4%), followed by Eastern Airlines (7.4%), Southern Airlines (6.7%), Air China (2.3%), and Juneyao Airlines (-3.0%) [2] - RPK (Revenue Passenger Kilometers) growth rates for July were highest for Eastern Airlines (9.4%), followed by Spring Airlines (8.6%), Southern Airlines (7.3%), Air China (2.2%), and Juneyao Airlines (-3.2%) [2] - Cumulative ASK growth from January to July showed Spring Airlines (9.6%) leading, followed by Eastern Airlines (7.5%) and Southern Airlines (5.7%) [2] - Cumulative RPK growth for the same period was highest for Eastern Airlines (11.8%) [2] 2. Passenger Load Factor - In July, the passenger load factor was highest for Spring Airlines at 91.9%, followed by Juneyao Airlines and Eastern Airlines both at 84.8% [4] - Cumulative load factor from January to July showed Spring Airlines at 90.7%, with Southern Airlines at 85.3% [4] 3. Fleet Size - As of July 2025, the five listed airlines collectively added 7 aircraft, with a year-on-year fleet size increase of 3.5% [4]

Core Insights - The event showcased Huawei's HarmonyOS ecosystem, emphasizing its innovative features and user-friendly interactions for young students [1][3][9] Group 1: Event Overview - 200 students participated in an immersive experience at Huawei's research base, exploring the HarmonyOS ecosystem [1] - The event included interactive exhibits from ten ecosystem partners, enhancing the overall experience with unique functionalities [3] Group 2: Innovative Features - Students engaged with features like "tap to share" and seamless content transfer across devices, highlighting the convenience and intelligence of the HarmonyOS [3] - The Bilibili HarmonyOS version demonstrated innovative split-screen design, allowing users to watch videos while controlling playback simultaneously [3] Group 3: Practical Applications - The Didi HarmonyOS version featured real-time vehicle information on the lock screen and simplified trip sharing [5] - The Qunar travel app showcased voice command capabilities for booking train tickets, streamlining the user experience [5] Group 4: Educational Aspects - The event included talks from industry leaders and Huawei experts, providing valuable insights into technology development and career paths [7] - Over 400 universities are involved in HarmonyOS talent cultivation, with more than 6,100 companies participating in innovation training camps [7] Group 5: Support Initiatives - Huawei launched the "Star Plan," investing 100 million yuan to support campus developers, offering incentives for application development [8] - The plan provides financial rewards for successful app submissions, encouraging student participation in the HarmonyOS ecosystem [8] Group 6: Youth Engagement - The enthusiasm of the younger generation for the HarmonyOS ecosystem is translating into active participation in both usage and development [8] - The event served as a practical classroom for showcasing China's technological self-innovation, fostering a connection between youth and technology [9]

Investment Rating - The investment rating for the airline transportation industry is "Positive" [2][6]. Core Insights - The industry has maintained a high passenger load factor, but ticket prices have shown weakness, particularly in July, attributed to limited travel demand and intense competition among airlines. The implementation of the "anti-involution" measures and the self-discipline agreement by the China Air Transport Association is expected to mitigate malicious competition and stabilize pricing [3][12]. - The average ticket price in the domestic market has decreased by 9.1% year-on-year as of mid-August 2025, with July's average ticket price down 8.8% year-on-year. However, the rate of decline in ticket prices has recently narrowed [4][25]. - The airline industry is experiencing a slowdown in capacity growth, with domestic airlines maintaining low growth rates in capacity deployment. The passenger load factor remains high, with significant year-on-year increases noted for major airlines [6][43]. Summary by Sections 1. Supply and Demand - The industry passenger load factor reached 84.6% in June 2025, up 1.3 percentage points year-on-year. The available seat kilometers (ASK) and revenue passenger kilometers (RPK) increased by 5.5% and 7.1% year-on-year, respectively [14][18]. - Domestic routes saw a 3.8% increase in turnover volume year-on-year, while international routes have nearly recovered to 97.7% of 2019 levels [23][24]. 2. Ticket Pricing - The average domestic ticket price was 867 CNY, down 9.1% year-on-year as of August 15, 2025. The average ticket price in July fell by 8.8% year-on-year, with a slight narrowing of the decline observed in early August [4][25]. - Recent weekly average ticket prices showed declines of -7.9%, -10.8%, -9.8%, and -8.4% in the four weeks leading up to mid-August [25][26]. 3. Fuel and Exchange Rates - The average price of aviation fuel decreased by 12.9% year-on-year in August 2025. The average ex-factory price of aviation kerosene was 5616 CNY per ton, with a significant decline noted in the first two quarters of 2025 [36][39]. - The exchange rate of the US dollar to the Chinese yuan remained stable, with a slight decrease of 0.71% from the end of 2024 to mid-August 2025 [36][42]. 4. Airline Operations - In the first seven months of 2025, domestic airlines showed varied capacity growth, with some airlines like Spring Airlines increasing capacity by 4.0%, while others like China United Airlines saw a decline [6][43]. - The passenger load factor for major airlines in July 2025 was as follows: China Southern Airlines at 84.38%, China Eastern Airlines at 84.76%, and Spring Airlines at 91.86% [46].

Investment Rating - The report recommends "Buy" for the logistics sector, specifically highlighting SF Holding in the express delivery segment and Hecun Co., Ltd. in the smart logistics space [2][3]. Core Insights - The express delivery sector saw a 15% year-on-year increase in business volume in July, but the average revenue per ticket decreased by 5.3%. The report anticipates a potential increase in ticket prices due to seasonal demand and price adjustments in production areas [2]. - The logistics sector is experiencing a stabilization in hazardous chemical water transport prices, with a recommendation for Hecun Co., Ltd. as it focuses on smart logistics and benefits from improving demand [3]. - The aviation sector is responding to regulatory changes aimed at curbing unhealthy competition, with a noted increase in flight operations and a recommendation for major airlines like Air China and China Southern Airlines due to expected profit elasticity from supply-demand optimization [4]. Summary by Sections Transportation Market Review - The transportation index decreased by 0.5% from August 9 to August 15, while the Shanghai and Shenzhen 300 index increased by 2.4%, indicating underperformance in the transportation sector [12]. Industry Fundamentals Tracking Shipping and Ports - The report indicates that the shipping sector is under pressure, with the China Export Container Freight Index (CCFI) at 1193.34 points, down 0.6% week-on-week and down 40.9% year-on-year. The Shanghai Export Container Freight Index (SCFI) is at 1460.19 points, down 2.0% week-on-week and down 52.9% year-on-year [20]. - Domestic shipping is showing a slight improvement, with the Domestic Container Freight Index (PDCI) at 1068 points, up 1.7% week-on-week and up 7.9% year-on-year [28]. Aviation and Airports - The report notes a slight increase in domestic flight operations, with an average of 17,225 flights per day, up 2.76% year-on-year. The report also highlights the release of a self-regulatory charter by the China Air Transport Association to combat unhealthy competition [4][49]. - The domestic air passenger volume in June 2025 was 54.01 million, a 3% increase year-on-year, while international passenger volume increased by 17% [52]. Rail and Road - The report indicates a stable upward trend in road transport, with a 2.44% year-on-year increase in truck traffic on highways. The railway sector also shows positive signs, with a 5.4% year-on-year increase in freight volume for the Daqin Railway in July [73][78].

Core Insights - The event "Walk into Huawei: The First HarmonyOS Public Class" gathered 200 young students eager to explore technology at Huawei's research base, showcasing the company's commitment to fostering innovation among youth [1][3]. Group 1: Event Overview - The event featured a unique transportation experience within the Huawei campus, enhancing the students' excitement and engagement with the innovative environment [3]. - Students experienced the HarmonyOS ecosystem firsthand, interacting with various Huawei products and applications, which highlighted the advanced technology and user-friendly features of HarmonyOS 5 [6][8]. Group 2: Ecosystem Engagement - The HarmonyOS exhibition area was particularly popular, allowing students to engage with innovative applications and features such as "Touch and Share" for photo transfer and multi-device streaming [6][8]. - Various ecosystem partners, including major brands like Air China and Bilibili, provided interactive experiences that captivated the students, demonstrating the collaborative nature of the HarmonyOS ecosystem [8]. Group 3: Future Aspirations - The event inspired students to consider participating in the HarmonyOS Innovation Competition, reflecting the positive impact of the experience on their aspirations in technology and development [8]. - The interaction with the HarmonyOS ecosystem instilled a sense of potential in the students, suggesting that they may become future developers and contributors to the ecosystem [8].

Investment Rating - The report maintains a cautious recommendation for the transportation industry, indicating a potential increase in stock prices relative to the benchmark index within the next 12 months [5]. Core Insights - The China Air Transport Association has released a self-discipline convention aimed at regulating market order and reducing chaotic price competition in the aviation industry, which is expected to enhance the core competitiveness and sustainable development of the air passenger transport sector [2][15]. - Major ride-hailing platforms, including Didi and Cao Cao, have collectively reduced their commission rates, which is anticipated to stabilize the market and benefit leading platforms in the long term [3][21]. - The report suggests that the recovery of business travel demand is crucial for the aviation sector, with a strong likelihood of price increases in the fourth quarter if there are signs of improvement in this area [3][18]. Summary by Sections Market Review - From August 1 to August 15, 2025, the A-share transportation index rose by 1.49%, with the aviation sector leading at 3.3%, while the overall market performance ranked 20th out of 28 industries [1][8]. Event Commentary - The self-discipline convention by the China Air Transport Association aims to adapt pricing to changing passenger structures and longer booking cycles, which is expected to improve pricing dynamics during the off-peak season [2][15]. - The collective reduction of commission rates by ride-hailing platforms is seen as a move towards a healthier industry development and market share concentration, particularly benefiting Cao Cao, which is leveraging its relationship with Geely Group for technological and manufacturing advantages [3][21][25]. Investment Recommendations - The report emphasizes the importance of monitoring business travel demand recovery and suggests that the aviation sector has a solid foundation for price increases, particularly in the fourth quarter, contingent on improvements in demand [3][18]. - Companies such as Huaxia Airlines, Juneyao Airlines, Spring Airlines, and the three major state-owned airlines are highlighted as potential investment opportunities [3].

Investment Rating - The report maintains a recommendation for the transportation industry, highlighting potential investment opportunities in various sectors such as aviation, shipping, infrastructure, and express delivery [2][3]. Core Insights - The report emphasizes the recovery of passenger traffic in the aviation sector, with domestic ticket price declines narrowing. It also notes the potential for valuation recovery in the express delivery industry due to reduced price competition [2][7][24]. - The shipping sector is under observation for the impact of geopolitical events and market dynamics, particularly regarding oil transportation and the upcoming cargo market in September [7][16]. - Infrastructure investments are seen as attractive due to stable dividend yields and the potential for valuation increases in port assets [19]. Summary by Sections Shipping - The report indicates a decline in shipping rates, with the SCFI for the East America route at $2719/FEU, down 2.6%, and the West America route at $1759/FEU, down 3.5% [11]. - It highlights the need to monitor the progress of U.S.-China trade negotiations and the impact of geopolitical tensions on shipping rates [12][16]. Infrastructure - The report notes that in June 2025, highway passenger volume decreased by 4.0% year-on-year, while port cargo throughput increased by 4.8% [17][57]. - It suggests that major highway stocks have become attractive for investment due to stable earnings and dividend expectations [19]. Express Delivery - In July 2025, express delivery volume reached 16.4 billion items, a year-on-year increase of 15.1%, with revenue growth of 8.9% [20][66]. - The report discusses the impact of "anti-involution" policies on price competition, suggesting a potential recovery in industry valuations [23][24]. Aviation - The report shows a 2.0% week-on-week increase in passenger volume, with domestic ticket prices declining by 3.7% year-on-year [24][25]. - It emphasizes the importance of monitoring the effects of "anti-involution" on industry valuations and the potential for recovery in earnings as travel demand increases [25][26]. Logistics - The report notes a slight decrease in daily traffic at the Ganqimaodu port, with an average of 978 vehicles, and an increase in short-haul freight rates [26][89]. - It highlights the importance of tracking chemical price indices and air freight rates for logistics investments [90].

Core Viewpoint - The strike by over 10,000 flight attendants of Air Canada, which began on August 16, is due to unresolved disputes regarding salary and compensation calculation methods, and it is expected to last for 72 hours [2][4]. Group 1: Impact of the Strike - Air Canada has suspended all flights for both itself and its low-cost subsidiary, Air Canada Rouge, affecting approximately 130,000 passengers daily during the strike and flight suspension period [4]. - The strike has led to the cancellation of all flights between Canada and Asia, including routes to Shanghai, Beijing, and Hong Kong [4]. - The sudden suspension of Air Canada's flights has created tension in the Canada-China route, resulting in a surge in ticket prices [5]. Group 2: Market Response - Ticket prices for flights from Shanghai to Vancouver have significantly increased, with some requiring multiple layovers costing over 30,000 yuan, and direct flights being sold out [7]. - As of August 21, all tickets for the Beijing to Vancouver route on Air China are sold out, with only high-priced business class tickets available [9]. - Eastern Airlines' Shanghai to Vancouver route will not have economy class tickets available until August 25, and those available require connections with partner airlines [9]. Group 3: Airline Operations - Air Canada is the flag carrier of Canada, operating direct flights from Vancouver to major Chinese cities, and holds a unique position in the market due to air traffic rights limitations [5][8].

Shipping Industry - The recent increase in crude oil shipping rates, particularly for VLCCs, is attributed to OPEC+'s decision to accelerate production in July and the imposition of punitive tariffs by Trump on India's purchase of Russian oil, indicating a potential bottoming out of the oil shipping market during the summer [1] - Given the current supply dynamics, shipping rates and stock prices are expected to outperform, with marginal changes in demand likely to have a multiplier effect on rates; recommendations include COSCO Shipping Energy and China Merchants Energy, with a focus on China Merchants Jinling [1] - In the container shipping sector, weakening cargo volumes have led to declining rates on US and European routes, with short-term demand primarily influenced by US-China tariff policies; however, profitability for container shipping companies is expected to remain under pressure throughout the year [1] Aviation Industry - As the summer travel peak season nears its end, there has been a slight increase in overall and domestic flight volumes, with overall and domestic flights up by 0.6% and 0.5% respectively compared to the previous week, and overall flights at 110.3% of 2019 levels [2] - The domestic average ticket price has decreased by 8.7% year-on-year, while passenger load factors have improved by 0.7 percentage points; the overall aviation market is experiencing a situation of rising volume but falling prices [2] - Investment recommendations suggest positioning in the aviation sector at lower points, as profits and stock prices are expected to rebound significantly with economic recovery, with specific recommendations for China National Aviation, China Eastern Airlines, China Southern Airlines, and Spring Airlines [2] Express Delivery Industry - The "anti-involution" policy initiated on July 1 has led to price increases in the express delivery sector, with minimum price standards raised in regions like Zhejiang and Guangdong, indicating a shift towards improved service quality and reduced competition [3] - The express delivery industry is expected to see a balance between regulation, competition, profitability, and quality, with positive price and profit performance anticipated in the fourth quarter [3] - Investment suggestions include focusing on SF Express, which is expected to benefit from increased consumer demand for home appliances and 3C products, and monitoring the effects of the "anti-involution" policy on other express companies like ZTO Express, YTO Express, Shentong Express, and Yunda Express [3]

Core Viewpoint - The establishment of the joint venture company for the Nantong New Airport indicates a strategic move to enhance Shanghai's international aviation hub status, with significant involvement from Shanghai Airport Group and local government [4][6]. Group 1: Company Formation and Structure - The newly formed Nantong New Airport Construction Investment Co., Ltd. is primarily engaged in civil airport operations and construction, with Shanghai Airport Group holding a 51% stake and Nantong Urban Construction Group holding 49% [3][4]. - The joint venture's establishment highlights Shanghai Airport's leading role in the development of the Nantong New Airport, often referred to as "Shanghai's third airport" [4][6]. Group 2: Airport Development and Planning - The Nantong New Airport is planned to have two long-distance runways and a terminal capable of handling 40 million passengers annually, with future expansion potential to accommodate 80 million passengers [9]. - The airport's location is approximately 100 kilometers from both Shanghai Hongqiao and Pudong airports, necessitating effective transportation network planning to integrate the three airports [6][9]. Group 3: Strategic Importance and Market Potential - Major airlines, including Air China, China Eastern Airlines, and China Southern Airlines, are proactively planning operations at the Nantong New Airport, recognizing its potential for local passenger traffic and spillover from Shanghai [9]. - The Long Triangle region already has seven major airports, and the development of Nantong New Airport is part of a broader strategy to optimize airport operations and enhance regional aviation competitiveness [10]. Group 4: Regional Collaboration and Integration - The establishment of the Nantong New Airport aligns with the Yangtze River Delta regional integration plan, which aims to create a coordinated airport system to avoid redundancy and improve efficiency [10]. - The East Airport Group's acquisition of several regional airports indicates ongoing efforts to streamline airport management and enhance service capabilities across the region [10].