Report Summary 1. Report Industry Investment Rating - No relevant information provided. 2. Core Viewpoints - The shipping market is in a downward trend. The main reasons include Powell's speech at the Jackson Hole Symposium, which raised market expectations for interest rate cuts, and Trump's threat to impose tariffs on imported furniture, leading to pre - trading of furniture shipments. The short - term market still has room to decline [6]. - The current shipping market demand is weak. With more overtime ships in late August, spot freight rates are under significant pressure. The market has shifted to a buyer - dominated situation, and there is no clear price - increase plan from shipping companies yet. Trump's tariff policies and global over - capacity further suppress trade volume [7]. - OCEAN's freight rate reduction in September is accelerating, which may put pressure on NSK to cut prices. The price of the 12 - contract is likely to show a weak and volatile trend [8]. 3. Summary by Content 3.1 Shipping Derivatives Data - **Freight Rate Index**: The Shanghai Export Container Freight Index (SCFI) is currently at 1415, down 3.07% from the previous value; the China Export Container Freight Index (CCFI) is at 1175, down 1.55%. Rates on various routes, such as SCFI - US West, SCFI - US East, and SCFI - Northwest Europe, all decreased, with the SCFI - Northwest Europe dropping by 8.35% and the SCFIS - Northwest Europe by 8.72% [4]. - **Contract Data**: All shipping contracts (e.g., EC2506, EC2608) showed price declines, with the largest drop of 3.05% in the EC2512 contract. Regarding positions, the positions of some contracts (e.g., EC2608, EC2410) increased, while the EC2606 position decreased by 1 [4]. - **Monthly Spread**: The 10 - 12 monthly spread increased by 18.5, while the 12 - 2 and 12 - 4 monthly spreads decreased by 8.7 and 16.7 respectively [4]. 3.2 Market News - Trump imposed a 50% tariff on most US imports from India to punish India for buying discounted Russian oil. The average spot freight rate on the US East route has dropped to the lowest level since the end of 2023, and the decline is expected to continue [5]. - Chinese trade negotiator Li Chenggang is expected to visit Washington this week to seek a new path based on the existing tariff truce [5]. 3.3 Market Analysis - The shipping market is in a downward trend. The market's expectation of interest rate cuts and Trump's tariff threat on furniture led to pre - trading of furniture shipments. The short - term market still has room to decline [6]. - The shipping market demand is weak. Overtime ships in late August pressured spot freight rates. Shipping companies such as MSC and MSK have announced September quotes, generally maintaining August levels. MSK will lower the peak - season surcharge and raise the overweight surcharge threshold. Some shipping companies are relaxing long - term low - price booking restrictions. The empty - sail rate on the European route in September is low, and there is no obvious signal of supply tightening in the short term [7]. - OCEAN's freight rate reduction in September is accelerating, which may force NSK to cut prices. The price of the 12 - contract is likely to be weak and volatile [8]. 3.4 Investment Strategy - The strategy is to short the 10 - contract on rallies and conduct a 10 - 12 reverse spread on a rolling basis [9].

Core Viewpoint - The company reported a strong performance for 2024, with revenue and net profit significantly increasing year-on-year, indicating robust operational growth despite potential industry challenges [1] Financial Performance - In 2024, the company achieved revenue of 233.859 billion yuan, a year-on-year increase of 33.3%, and a net profit attributable to shareholders of 49.1 billion yuan, up 105.78% year-on-year, resulting in earnings per share of 3.08 yuan [1] - For Q4 2024, the company recorded revenue of 59.122 billion yuan, a year-on-year increase of 44.6%, but a quarter-on-quarter decline of 19.6%. The net profit for Q4 was 10.976 billion yuan, reflecting a year-on-year increase of 513.5% and a quarter-on-quarter decrease of 48.4% [1] Operational Metrics - The company’s container freight volume improved year-on-year, reaching 25.94 million TEUs, an increase of 10.12%. The trans-Pacific route benefited from a 13% increase in cargo volume due to rising U.S. import demand, while the Asia-Europe route saw a 13.3% decrease in cargo volume due to reduced effective capacity from the Red Sea detour [1] - The average SCFI composite index for container shipping rates in 2024 was 2506 points, representing a significant year-on-year increase of 149.2% [1] Industry Trends - The container shipping industry is expected to face supply pressures, with spot rates potentially continuing to decline. The SCFI rates for European and U.S. West Coast routes have decreased by 54.2% and 41.4% respectively since the beginning of the year [2] - Supply growth is projected at 6.2% for 2025 and 3.3% for 2026, while demand growth is forecasted at 0.0% for 2025 and -4.7% for 2026, indicating ongoing supply-demand pressures [2] - The recovery of the Red Sea route and U.S. tariff policies are critical variables affecting industry supply and spot rates. The current low number of vessels transiting the Red Sea suggests a challenging recovery ahead [2] Profit Forecast and Valuation - Due to better-than-expected long-term contract signing prices, the company has raised its 2025 net profit forecast by 13.7% to 27.1 billion yuan and introduced a net profit estimate of 20.5 billion yuan for 2026 [3] - The current A-share price corresponds to 8.5 times and 11.3 times the 2025 and 2026 price-to-earnings ratios, while the H-share price corresponds to 6.8 times and 8.8 times for the same periods [3] - The target prices for A-shares and H-shares remain unchanged at 16.30 yuan and 14.50 HKD respectively, indicating potential upside of 12.5% and 18.9% from current prices [3]