Group 1 - HSBC Research has lowered the target price for Bank of Communications (03328.HK) from HKD 6.6 to HKD 6.3, maintaining a "Hold" rating [1] - The bank reported a year-on-year increase of 1.5% in earnings per share for the first quarter, attributed to better net interest margin trends and reduced credit costs compared to peers [1] - However, the growth in costs was higher than that of competitors, and the upcoming capital injection is expected to dilute earnings per share and dividends [1] Group 2 - HSBC has adjusted its earnings per share forecasts for the company downwards by 1.2%, 3.3%, and 2.7% for the years 2023 to 2027 respectively [1]

Core Viewpoint - General Motors (GM) has raised concerns for the stock market by suspending its earnings guidance and share buybacks due to tariff uncertainties, despite reporting solid first-quarter earnings [1][3][12] Financial Performance - GM's first-quarter revenue increased by 2.3% to $44 billion, surpassing the consensus estimate of $43.2 billion [2] - Adjusted earnings per share rose by 6% to $2.78, exceeding expectations of $2.66 [2] - The company announced a quarterly dividend increase from $0.12 to $0.15 per share [2] Market Reaction - GM's stock experienced a modest decline of 1% to 2% during the trading session following the earnings report [2][3] - The suspension of guidance and share buybacks has dampened investor sentiment, undermining the bullish case for the stock [3][11] Investment Thesis - GM has historically been a market laggard with sluggish growth, facing investor fears regarding electric and autonomous vehicle disruptions [5] - The stock trades at a low valuation similar to peers like Ford and Stellantis, but GM's dividend yield remains low at 1.3% compared to Ford's 7.5% and Stellantis's 8.2% [6] - Low-valuation stocks like GM can return capital to shareholders through share buybacks, which have historically been a strength for the company [7][8] Future Outlook - The implications of the buyback suspension remain unclear, with potential discussions expected in the upcoming earnings call [10] - A prolonged suspension of share buybacks could signal a lack of confidence in profit generation amid economic uncertainties [11][12]

Investment Rating - The report maintains a "Strong Buy" rating for the company with a target price of 67 CNY [1][9]. Core Views - The company reported a steady start to 2025, with Q1 revenue of 4.36 billion CNY, a year-on-year increase of 1.5%, and a net profit attributable to shareholders of 470 million CNY, up 4.6% year-on-year [1][9]. - The company is expected to continue its stable performance, supported by a healthy inventory and practical operational strategies, with a projected dividend yield of approximately 4.6% based on a 100% payout ratio [9]. Financial Performance Summary - In Q1 2025, the company achieved a sales volume of 884,000 kiloliters, a year-on-year increase of 1.93%, with an average price per ton of 4,930 CNY, down 0.46% year-on-year [9]. - The gross profit margin improved to 48.4%, an increase of 0.5 percentage points year-on-year, driven by cost advantages and scale effects [9]. - The company’s operating profit margin for Q1 2025 was 26.3%, with a net profit margin of 21.6% [10]. Future Projections - The company forecasts total revenue of 14.83 billion CNY for 2025, with a year-on-year growth rate of 1.3% [4]. - The net profit attributable to shareholders is projected to reach 1.27 billion CNY in 2025, reflecting a growth rate of 13.9% [4]. - Earnings per share (EPS) are expected to increase from 2.30 CNY in 2024 to 2.62 CNY in 2025 [4]. Market Strategy - The company plans to deepen its core market presence while optimizing its product mix and increasing market share, particularly in non-traditional channels [9]. - New product launches, such as the Chongqing Craft Beer, are aimed at enhancing brand influence and market penetration [9].