Summary of the Conference Call Transcript Industry Overview - The report focuses on the **Vietnamese equity market**, particularly the **VN30 index** and various sectors within it, including **Consumer Discretionary**, **Real Estate**, **Information Technology**, and **Materials** [2][8][9]. Key Findings Earnings Results - Most sectors in the Vietnamese market **missed earnings expectations** this quarter, with **six sectors** delivering misses and **three sectors** posting beats. Notably, **Consumer Discretionary** and **Real Estate** were among the sectors that beat expectations, with Real Estate achieving this for the **third consecutive quarter** [2][9]. Sales and Earnings Revisions - Overall revisions for sales and earnings lean slightly positive. There is a minor negative adjustment to aggregate earnings for **2026E** and **2027E**, but the magnitude is negligible. The ratio of positive to negative revisions does not indicate a broadly negative outlook [3][11]. - **Consumer Discretionary** and **Consumer Staples** showed meaningful upward revisions across all three forward years, while **Information Technology** and **Materials** faced downward revisions [3][15][18]. Sector Performance - **Consumer Discretionary** and **Real Estate** sectors performed well, with **Consumer Discretionary** achieving a **100% beat rate** among its constituents [10]. - **Information Technology** and **Materials** sectors faced challenges, with **Information Technology** experiencing misses across all three forward years [15][18]. Valuations - As of **November 11, 2025**, the VN30 index was trading at **2.1x** 12-month forward price-to-book (PB), which is **6.6% above** its 10-year average of **2.0x**. Year-to-date performance in USD terms is on par with **MSCI Emerging Markets** but outperformed **MSCI ASEAN** by **21%** [4]. Preferred Stocks - The report identifies preferred stocks in Vietnam, including: - **Mobile World Investment (MWG)**: Price target of **96,000 VND** for 2025, with a market cap of **4.334 billion USD** and a **P/E ratio** of **18.2x** for 2025. - **Asia Commercial Joint Stock Bank (ACB)**: Price target of **40,000 VND**, market cap of **4.851 billion USD**, and a **P/E ratio** of **7.3x** for 2025. - **Hoa Phat Group (HPG)**: Price target of **34,000 VND**, market cap of **7.759 billion USD**, and a **P/E ratio** of **13.3x** for 2025. - **Nam Long Investment Corporation (NLG)**: Price target of **42,000 VND**, market cap of **670 million USD**, and a **P/E ratio** of **14.9x** for 2025 [5]. Consensus Rating Changes - The consensus rating distribution has skewed towards downgrades post-results, particularly in the **Real Estate** sector, which did not experience upgrades despite delivering strong results [22]. Risks and Challenges - The report highlights various risks for the preferred stocks, including: - **Mobile World**: Risks related to strategic planning, operational errors, and competition. - **ACB**: Risks from competition, regulatory challenges, and potential asset quality issues. - **Hoa Phat Group**: Risks from regulatory challenges, trade protectionism, and reliance on imported raw materials. - **Nam Long**: Risks related to land access, project pre-sales uncertainties, and execution of strategy [27][28][29][30]. Conclusion - The Vietnamese equity market shows mixed results with certain sectors outperforming while others face challenges. The overall sentiment remains cautiously optimistic, with specific stocks identified as potential investment opportunities amidst the evolving market landscape [3][4][22].

Core Viewpoint - The market is currently experiencing valuation concerns and earnings revisions that are not meeting expectations, leading to a cautious outlook for the short term while remaining constructive for the year ahead [1][2]. Market Valuation and Earnings - Valuations have been hitting a ceiling since August, with major indices like the S&P 500 and NASDAQ 100 close to their typical highs [3]. - There is a sense of "sticker shock" in the market, indicating a need to work through current valuation levels [4]. - Earnings sentiment, measured by the rate of upward revisions, has shown fluctuations, with a recent improvement to 55% after dropping to 51.9% [11][12]. Small Cap Performance - The outlook for small caps is neutral, reflecting a lack of a hot economic environment necessary for sustained outperformance [6][7]. - Hedge funds tend to invest in small caps during optimistic periods regarding Federal Reserve rate cuts but exit once that optimism wanes [8]. Sector Analysis - The industrial sector is currently the most expensive based on median price-to-earnings ratios, surpassing even the tech sector [18]. - Consumer companies, particularly in staples and discretionary sectors, have reported disappointing earnings, indicating potential weakness in consumer sentiment [19][20]. AI and Technology Impact - There is a divergence in earnings sentiment between AI technology builders and users, with builders showing positive sentiment while users are not experiencing transformational impacts from AI [15][16].

Summary of Dongfang Electric Conference Call Company Overview - **Company**: Dongfang Electric (1072 HK/600875 CH) - **Industry**: Electrical Equipment Key Points and Arguments 1. Upgrade to Buy/Buy - Dongfang Electric's H/A shares have been upgraded to Buy/Buy from Reduce/Reduce due to improved risk/reward dynamics after a recent price cooldown. The current trading PE is 12x for 2026 estimates, which is +1 standard deviation above the past three-year mean, down from +3 standard deviations previously. This indicates a more attractive valuation compared to global peers like GE Vernova and Siemens Energy, which trade at 31-47x 2026e PE [1][8][33]. 2. Sustained Upcycle in Coal Power Equipment - The expectation for new orders and revenue from coal power equipment has shifted. The delivery cycle is extended due to tight supply, leading to an increase in installation and equipment delivery from 55GW in 2025 to 80GW in 2027. This change has prompted an increase in EPS forecasts for 2026 and 2027, indicating continued growth in this segment [2][4]. 3. Earnings Projections for 3Q25 - Dongfang Electric is projected to achieve a 20% year-over-year growth in earnings, reaching RMB1.12 billion in 3Q25, which aligns with the high end of market expectations. A Corporate Day on November 6 could serve as a catalyst for further positive guidance [3][26]. 4. Financial Estimates and Target Prices - Estimates for 2026 and 2027 have been raised by 5-27% to account for the longer delivery cycle of coal power equipment. The target prices for Dongfang H/A have been increased to HKD21.50 and RMB23.50 from HKD12.20 and RMB17.70, respectively. This reflects a 22% CAGR in EPS from 2024 to 2027, supported by strong orders in coal, nuclear, and hydro segments [4][35]. 5. Risks and Concerns - Key downside risks include potential delays in equipment delivery, rising raw material costs, and weaker-than-expected margins in the wind turbine segment. These factors could impact the overall growth trajectory of the company [4][36]. Additional Important Information - The share prices of Dongfang Electric have corrected significantly after an initial surge due to the Yarlung Zangbo project announcement, falling 36%/21% from late July to late September. The current valuation is now seen as attractive again, with a projected earnings CAGR of 22% [19][22]. - The company is expected to maintain a strong cash flow from operations, with net profit estimates for 2026 and 2027 revised upwards significantly [28][29]. This summary encapsulates the critical insights from the conference call regarding Dongfang Electric's current market position, financial outlook, and potential risks, providing a comprehensive overview for investors.

Market Overview - The Dow has reached a record high, while the S&P 500 is close behind, indicating a strong market performance [1] - Current market positioning remains light, suggesting potential for continued rallying [2][3] Investor Sentiment - Deutsche Bank's consolidated positioning report shows a shift from the 70th percentile to the 40th percentile, indicating institutional investors are cautious [3] - Retail sentiment is becoming more extended, with increased leverage observed [4][5] Valuation Insights - Valuations are at "nosebleed" levels, but they are not reliable timing tools; they can remain high or low for extended periods [6][7] - Higher valuations could amplify potential downside risks if growth concerns arise, but better-than-expected earnings can support valuation expansion [8][9] Economic Indicators - Limited economic data is available, but alternative data sources indicate a deceleration in the US labor market [11] - The ratio of cyclical stocks to defensive stocks remains in an uptrend, suggesting optimism about the US consumer outlook [12][13] Market Risks - Signs of frothy sentiment are emerging, particularly in options data, indicating a lack of downside protection [15] - The bond market is signaling a potentially dire growth outlook despite positive economic indicators, such as a 3.8% GDP forecast from the Atlanta Fed [16] Small Cap Performance - The Russell 2000 has seen a rally, but many companies within it are not profitable, and earnings estimates continue to be cut [19][20] - ETF outflows from small caps suggest that the pain trade may push prices higher until inflows return [21] Federal Reserve Outlook - The expectation is for the Fed to cut rates in October, regardless of inflation data, with a long-term goal of achieving a 3% rate by 2026 [23][24]

Core Viewpoint - Morgan Stanley identifies Pinterest as a stock pick due to strong earnings revisions, indicating a favorable environment for stock selection amid rising stock-specific risks [1][2]. Group 1: Stock Selection Environment - Stock-specific risks have increased recently, creating a historically opportunistic environment for stock picking [1]. - Analysts' opinions on company earnings prospects are becoming more varied, contributing to a dispersion of earnings revision breadth [2]. Group 2: Earnings Revisions and Stock Performance - Research indicates that positive earnings revisions can lead to stock gains, with companies that exceed earnings expectations consistently outperforming those that fall short [3]. - Morgan Stanley's stock screen focuses on companies with strong earnings revision momentum, highlighting Pinterest, Reddit, Take-Two Interactive, Burlington Stores, and Carvana as top picks [4]. Group 3: Sector Updates - In the restaurant sector, pricing is restrained while promotional activity is high; the gaming and leisure sector, particularly cruises, is experiencing healthy demand [6]. - Analysts expect improvements in freight-related companies over the next six months [6]. - The technology sector shows continued strength in AI, with challenges in traditional storage and server capacities; within internet companies, agentic AI is gaining traction in e-commerce [6]. - In consumer finance, there is ongoing degradation at the low end of the market, but this trend is not spreading [6].

Summary of Key Points from the Conference Call Company and Industry Overview - **Company**: New China Life Insurance - **Industry**: Insurance, specifically focusing on life insurance in China Core Insights and Arguments - **Positive Profit Alert**: New China Life has issued a positive profit alert for 9M25, projecting a net profit (NP) of Rmb29.9-34.1 billion, which is significantly higher than the FY25 NP consensus of Rmb25.5 billion [2][5] - **Year-on-Year Growth**: The company anticipates a year-on-year (oya) growth of 45-65% for 9M25 NP, and 58-101% for 3Q25 NP, indicating strong performance despite a high base from the previous year [2][5] - **Market Sentiment**: The positive results are expected to enhance market sentiment and could lead to upward revisions in full-year earnings consensus for the sector, particularly for pure life insurers like China Life [2][5] - **Stock Valuation**: New China Life is currently trading at a price-to-earnings (P/E) ratio of 6x for FY26E, with a yield of 4%, following an interim dividend hike of Rmb0.67, which is a 24% increase year-on-year [2][5] Sector Analysis - **Sector Performance**: The insurance sector is experiencing a peak in the non-life underwriting cycle, leading to a downgrade of PICC P&C and PICC Group-H to Neutral ratings [4] - **Earnings Outlook**: While New China Life's results are promising, there is uncertainty regarding whether other insurers will report similarly strong earnings in 3Q25, as the earnings base for FY25 appears solid [5] - **Potential for Revisions**: There is potential for overall earnings and dividend upward revisions across the sector, as solvency capital seems adequate to absorb market volatility [5] Important but Overlooked Content - **Investment Strategy**: New China Life is actively de-risking its investment book by reducing exposure to non-standard assets, which is crucial for maintaining stability in net profit amid equity market fluctuations [14] - **Valuation Methodology**: The valuation for New China Life is based on an 8x FY26E P/E, which is below historical averages, reflecting concerns over new life sales volume and macroeconomic conditions [15] - **Risks**: Key risks to the rating and price target include slower-than-expected product mix enhancement, faster-than-expected headcount liquidation, and weaker-than-expected equity market performance [17] Financial Forecasts - **Earnings Forecasts**: The earnings forecast for major insurers shows a conservative consensus for FY25 net profit levels, with China Life expected to see a 9% decline while PICC P&C anticipates a 24% growth [5][7] - **Quarterly Earnings Table**: The quarterly earnings forecast indicates significant variations in expected performance across different insurers, with New China Life showing a notable expected growth in 3Q25 [7] This summary encapsulates the key points from the conference call, highlighting the positive outlook for New China Life Insurance and the broader insurance sector, while also addressing potential risks and valuation considerations.

Summary of Conference Call Notes Industry Overview - **Industry**: Greater China Technology Hardware - **Date**: October 7, 2025 Key Companies Discussed 1. **Crystal Optech (002273.SZ)** 2. **Gosuncn Technology Group (300098.SZ)** 3. **Wingtech Technology Co Ltd (600745.SS)** 4. **OFILM Group (002456.SZ)** Core Insights and Arguments Crystal Optech - **Earnings Growth**: Reported 13% earnings growth in 2Q25 with gross margin improvement from 27.9% in 1Q25 to 30.9% in 2Q25 [2] - **Price Target Increase**: Price target raised from Rmb22 to Rmb32 due to better growth outlook for 2026-27 [8][20] - **Future Prospects**: Anticipation of a new product breakthrough from a key customer in 2H26, alongside ongoing product development [2] Gosuncn Technology Group - **Revenue Growth**: Achieved 47% revenue growth in 2Q25, with gross margin improving from 33.8% in 2Q24 to 38.1% in 2Q25 [3] - **Profitability**: Turned profitable in 2Q25 after four quarters of losses, with earnings estimates revised from a loss of Rmb4 million to a profit of Rmb96 million for 2025 [3] - **Price Target Increase**: Price target raised from Rmb3.60 to Rmb5.00 [8][20] Wingtech Technology Co Ltd - **Profit Turnaround**: Despite a revenue decline in 2Q25, the company achieved profit turnaround for the second consecutive quarter [4] - **Future Growth**: Expected high-margin business to drive revenue and earnings growth, with continuous capacity expansion planned [4] - **Price Target Increase**: Price target raised from Rmb38 to Rmb50 [8][20] OFILM Group - **Earnings Decline**: Reported a loss of Rmb50 million in 2Q25, leading to a 62% cut in earnings estimates for 2025 [5] - **Price Target Stability**: Price target remains unchanged at Rmb10, with expectations of earnings improvement driven by growth in the IoT division [5][20] - **Challenges**: Weak competitiveness and potential margin compression in the vehicle-related business due to fierce competition in the EV market [35] Additional Important Insights - **Earnings Estimates Revisions**: Significant revisions made for earnings estimates across the companies, with Crystal and Gosuncn seeing substantial upward revisions while OFILM faced downward adjustments [12][18] - **Market Sentiment**: Morgan Stanley's earnings forecasts are now 42% and 27% higher than consensus for 2025 and 2026, respectively [14] - **Valuation Methodology**: Price targets derived from a residual income model, maintaining cost of equity assumptions unchanged [19] Conclusion The conference call highlighted a positive outlook for Crystal, Gosuncn, and Wingtech, with significant earnings growth and price target increases. In contrast, OFILM faces challenges that have led to earnings downgrades and a cautious outlook.

Summary of Earnings Conference Call Industry Overview - The conference call focuses on the Asia Pacific Emerging Markets (APxJ/EM) equity strategy, particularly highlighting earnings results for the June quarter of 2025 - Key markets discussed include Japan, China, and EEMEA, with a notable emphasis on the performance of various sectors within these regions Key Points and Arguments 1. **Earnings Performance**: - June quarter results have shown improvement, especially in Japan and China, with 13-17% of companies reporting 'beat/raise' results [1][2] - Overall, APxJ/EM saw a net 4 percentage point (ppt) of results beating consensus, while 5 ppt of companies are expected to see 12-month consensus lowered [2][16] 2. **Market Revisions**: - Japan, China, and EEMEA are flagged for consensus upgrades, while other markets are expected to show downgrades [3] - Aggregate earnings estimate revisions across APAC/EM remain negative, but improvements are noted, particularly in MSCI China, which has turned positive for the first time since mid-2021 [5] 3. **Sector Performance**: - Financials, Energy, and Communication Services reported the strongest results/guidance versus consensus, while Staples, Discretionary, IT, and Materials lagged [3][15] - In Japan, sectors such as Real Estate, Financials, and Health Care showed strong results, while Information Technology faced downgrades [24][26] 4. **Earnings Guidance**: - Analysts expect 6% and 8% growth for MSCI EM in 2025 and 2026, respectively, while Japan is projected to grow by 1% and 5% [5] - Japanese companies have seen a net 15 ppt of results above consensus, with 42% above and 26% below expectations [24] 5. **Stock Surprise Screens**: - Four surprise stock screens were highlighted: 1. Best on ground: beat + raise, OW-rated 2. Tough conditions: miss + lower, UW/EW-rated 3. Short squeeze potential: highly shorted stocks seeing upgrades 4. Profit-taking risk: high short-term momentum stocks facing downgrades [4][29] 6. **Regional Insights**: - China showed a net 13% beat with 47% of results above expectations, while Taiwan faced a negative pattern with a net -26% revision [18][20] - EEMEA and Japan exhibited the strongest results patterns, contrasting with weaker performances in Taiwan, India, and Latin America [18][23] Additional Important Insights - Analysts have published a total of 943 Reaction to Earnings reports for the quarter, indicating a structured approach to assessing earnings results [16] - The conference call emphasized the importance of understanding sector-specific dynamics and regional performance to identify potential investment opportunities and risks [12][15] - The data covers reports published from May 22 to August 21, 2025, providing a comprehensive view of the earnings landscape during this period [9][28]

Investment Rating - The report maintains a Neutral rating for Haidilao International Holding with a 12-month price target of HK$15.30, implying an upside potential of 8.4% from the current price of HK$14.12 [1][2][26]. Core Insights - The earnings forecasts for Haidilao have been revised down by 13%-16% for 2025-27, primarily due to lower-than-expected performance in 1H25, slower store expansion, and the company's strategy to offer better value to customers [2][23][27]. - The company is expected to experience a revenue decline of 4% year-on-year in 1H25, driven by weaker table turn performance and a decrease in party size, although a slight improvement in average selling price (ASP) may provide some offset [20][21]. - Despite the challenges in 1H25, the second half is anticipated to show a recovery in same-store sales growth (SSSG) due to an easier comparison base, which could lead to slight positive growth in average sales per store [2][22]. Summary by Sections Earnings Forecasts - The report projects a revenue of Rmb20.6 billion for 1H25, reflecting a 4% decline year-on-year, with restaurant revenue expected to drop by 6% [20][21]. - For 2025, total revenue is estimated at Rmb43.09 billion, down from the previous estimate of Rmb44.62 billion, marking a 3.4% reduction [25]. Margin Analysis - The gross profit margin (GPM) is expected to contract to 60.7% in 1H25, down from 61.0% in 1H24, due to increased food cost ratios and operating deleverage [1][21]. - Operating profit margin (OPM) is projected to decrease by 0.8 percentage points year-on-year to 11.8% [21]. Store Expansion and Performance - The company is expected to close 8 net stores in 1H25, indicating a cautious approach to expansion amid fluid consumption trends [20]. - The total store count for Haidilao is projected to decrease by 30 stores in 2025, with a total of 1,415 stores expected [25]. Valuation Metrics - The report provides a valuation of 16X for the 2025 estimated price-to-earnings (P/E) ratio, with a projected dividend yield of 6% [2][13]. - The adjusted EBITDA for 2025 is forecasted at Rmb8,063.4 million, reflecting a decline from previous estimates [25]. Key Focus Areas for Investors - Investors are advised to monitor the trends in table turn performance, store expansion plans, margin outlook, and the impact of delivery subsidies on overall performance [22][23].

Investment Rating - The report maintains a "Buy" rating for Montage with a 12-month target price of Rmb106.00, indicating an upside potential of 27.7% from the current price of Rmb83.03 [17][15]. Core Insights - Montage's 2Q25 revenue is expected to grow by 52% year-over-year (YoY) to Rmb1.4 billion, driven by the increasing demand for DDR5 and Gen-3 interface integrated circuits (ICs) [1][4]. - The net income (NI) guidance for 2Q25 is projected to be between Rmb575 million and Rmb675 million, representing a YoY growth of 62% to 90%, which is 18% higher than previous estimates [1][4]. - The company's profitability is improving due to a shift towards higher-margin DDR5 interface ICs and enhanced operating leverage [1][4]. Revenue and Earnings Projections - The report revises earnings estimates upward by 5% for 2025, 3% for 2026, and 3% for 2027, reflecting higher revenues from DDR5 interface ICs and an improved product mix [5][8]. - Revenue projections for Montage are Rmb5.775 billion for 2025, Rmb8.366 billion for 2026, and Rmb10.926 billion for 2027, with corresponding gross profits of Rmb3.489 billion, Rmb5.059 billion, and Rmb6.613 billion respectively [8][17]. Margin Analysis - The report anticipates an increase in gross margin from 60.4% in 2025 to 60.5% in 2027, alongside an improvement in operating margin from 38.9% to 45.1% over the same period [8][9]. - The net margin is expected to rise from 41.4% in 2025 to 43.4% in 2027, indicating a positive trend in profitability [8][9]. Market Dynamics - The strong revenue growth is attributed to the rising penetration of DDR5 interface ICs and the increasing contribution from Gen-2 and Gen-3 products, with expectations that Gen-3 shipments will surpass Gen-2 by 4Q25/1Q26 [4][5]. - The company is set to begin production of Gen-4 DDR5 interface ICs, which are anticipated to offer better pricing and margins [4][5].