Investment Rating - The report maintains a "Recommend" rating for the company, indicating an expected outperformance of the benchmark index by 10%-20% over the next six months [1][21]. Core Views - The company's net profit attributable to the parent company decreased by 7.6% in the first half of 2025, indicating short-term pressure on its main business. However, the report remains optimistic about the company's enhanced attributes in the highway industry ETF [1][6]. - The company is recognized as a comprehensive highway operator with growth logic, benefiting from the integration advantages of a central enterprise platform and a history of acquiring quality road assets to enhance performance [6]. Financial Summary - Total revenue for 2024 is projected at 12,711 million, with a growth rate of 30.6%. For 2025, revenue is expected to increase slightly to 12,889 million, reflecting a growth rate of 1.4% [2]. - The net profit attributable to the parent company is forecasted to be 5,322 million in 2024, with a significant decline of 21.3%. However, it is expected to recover to 5,598 million in 2025, with a growth rate of 5.2% [2]. - Earnings per share (EPS) are projected to be 0.78 yuan in 2024, increasing to 0.82 yuan in 2025, and further to 0.87 yuan in 2026 [2]. - The target price for the company's stock is set at 12.43 yuan, representing a potential upside of 19% from the current price of 10.41 yuan [2][6]. Business Performance - In the first half of 2025, the company achieved total revenue of 56.63 billion yuan, a decrease of 5.36% year-on-year, primarily due to the impact of highway operations and differentiated toll policies [6]. - The investment operation segment generated revenue of 44.78 billion yuan, down 7.23% year-on-year, while the intelligent transportation segment saw a growth of 24.39% [6]. - The total mileage of highways operated by the company increased from 14,745 kilometers in 2024 to 14,865 kilometers in 2025, indicating ongoing expansion efforts [6]. Investment Recommendations - The report provides a profit forecast of 56.0 billion, 59.6 billion, and 63.5 billion for the years 2025 to 2027, with corresponding EPS of 0.82, 0.87, and 0.93 yuan, and PE ratios of 13, 12, and 11 respectively [6]. - The company has consistently increased its cash dividend payout ratio from 40.13% in 2018 to 53.44% in 2024, reflecting a commitment to shareholder returns [6].

Company Summary - The company, 勘设股份, announced a provision for asset impairment totaling 99.5483 million yuan, which will reduce the total profit in the consolidated financial statements for the first half of 2025 by the same amount [1] - The asset impairment has already been reflected in the company's financial report for the first half of 2025 [1] Industry Overview - For the year 2024, the revenue composition of the company is as follows: 67.61% from the highway sector, 21.68% from the construction sector, 7.39% from water transport and other sectors, 3.01% from the municipal sector, and 0.31% from other businesses [1]

Group 1 - The merger and acquisition market is experiencing increased activity, with a rise in the number of cases involving listed companies, showcasing characteristics such as accelerated industry integration and diversified payment methods [1][4] - A recent cross-market merger case involves Zhenyang Development, which announced plans for a significant asset restructuring with Zhejiang Huhangning, utilizing a share exchange method for the merger [2][3] - The transaction aims to create an A+H listed platform, enhancing the company's overall strength and efficiency through resource integration and elimination of competition within the same group [3][4] Group 2 - The number of absorption mergers among listed companies has increased, with various cases including "A and A," "A and H," and "H and A" mergers, indicating a trend towards consolidation in the market [4][5] - Recent policy changes, such as the revised restructuring guidelines by the China Securities Regulatory Commission, encourage absorption mergers as a key focus, simplifying the approval process and enhancing the market's responsiveness [5][6] - The diversification of payment methods in mergers and acquisitions is a notable feature of the current wave, with companies increasingly utilizing tools like convertible bonds, acquisition loans, and acquisition funds to facilitate transactions [7]

Market Performance - On the morning of the 27th, the Shanghai Composite Index experienced narrow fluctuations, while the Shenzhen Component Index and the ChiNext Index reached new highs during the session. In the afternoon, major indices saw a pullback, with the Shanghai Composite Index dropping over 1.5% and the Shenzhen Component Index falling over 1%. By the close, the Shanghai Composite Index fell 1.76% to 3800.35 points, the Shenzhen Component Index decreased 1.43% to 12295.07 points, and the ChiNext Index declined 0.69% to 2723.20 points. The total trading volume in the Shanghai and Shenzhen markets reached 31,984 billion yuan, an increase compared to the previous day [1]. Sector Performance - In terms of sector performance, the semiconductor and highway sectors showed strength, while sectors such as light industry machinery, oil trading, coke processing, real estate, shipbuilding, public transportation, liquor, textiles, cement, pharmaceutical commerce, lead-zinc, and general steel experienced weakness. Additionally, the CPO concept stocks saw a rise [1]. Corporate Earnings - According to Wanlian Securities, as of August 25, most companies reported a year-on-year increase in net profit attributable to shareholders, with leading companies performing well. It is expected that corporate profitability will gradually recover. The capital market showed a significant rebound in confidence in August, driven by policies aimed at reducing internal competition, which boosted the overall industry chain's prosperity. The TMT sector saw a leading inflow of funds, with various sub-sectors in pharmaceuticals and machinery equipment gaining market attention, while the dividend style experienced a pullback [2]. Investment Recommendations - The report suggests focusing on sectors with high prosperity in multiple sub-fields such as TMT and pharmaceuticals, capitalizing on opportunities in the technology growth sector. Additionally, ongoing macro-control policies are expected to continue driving economic growth momentum, with an emphasis on expanding domestic demand as a key investment theme [2].

Group 1: Financial Performance - Shenzhen International reported a revenue of HKD 6.67 billion for the first half of 2025, representing a year-on-year increase of 0.9% [1] - The profit attributable to shareholders was HKD 490 million, a decrease of 24.9% compared to the same period last year [1] - Basic earnings per share were HKD 0.2 [1] Group 2: Logistics Business - The logistics segment generated revenue of approximately HKD 987 million, up 12% year-on-year, due to the operational contribution from several logistics port projects [1] - The logistics park transformation and upgrade business achieved revenue of about HKD 68.74 million, a 9% increase from the previous year, primarily due to improved leasing conditions in the South China Digital Valley [2] - The profit attributable to shareholders from the logistics business decreased by 98% to approximately HKD 7.93 million due to the absence of income from the "investment, construction, and management" model [1] Group 3: Port and Related Services - Revenue from port and related services fell by 13% to approximately HKD 1.394 billion, mainly due to reduced income from the supply chain business as a result of falling coal prices and overall market demand slowdown [3] - The profit attributable to shareholders from this segment decreased by 72% to approximately HKD 12.04 million, impacted by increased depreciation and amortization costs from new project launches and intensified competition in the domestic port industry [3] Group 4: Infrastructure and Environmental Business - The overall revenue from Shenzhen Expressway Group, a non-wholly owned subsidiary, was approximately HKD 4.22 billion, a 4% increase year-on-year [3] - Net profit for Shenzhen Expressway increased by 21% to approximately HKD 1.114 billion, benefiting from changes in the fair value of financial assets and significantly reduced financial costs [3] - The profit attributable to shareholders from Shenzhen Expressway rose by 12% to approximately HKD 484 million [3]

Investment Highlights - The company is rated as outperforming the industry with a target price of 6.85 CNY for A-shares and 5.61 HKD for H-shares, based on dividend yield valuation methods, corresponding to 4.5%/4.7% dividend yields for 2025/2026 for A-shares and 6.0%/6.4% for H-shares [1] - The company possesses core road assets in the Chengdu-Chongqing region, with strong profitability, backed by the Shudao Group, managing approximately 900 kilometers of road assets, primarily connecting Chengdu with major cities in Sichuan and serving as significant transit routes to other provinces [1] - The company has maintained an average gross margin of 52.8% over the past decade, indicating strong profitability within the industry [1] Sustainable Profit Growth - The company is actively investing in core road assets with short remaining toll collection periods through expansion and acquisitions, including the ongoing expansion of Chengle Expressway and the acquisition of Chengdu Second Ring West, which is expected to contribute 160 million CNY in profit by 2025 [2] - The company has a high dividend payout ratio, with a commitment to return at least 60% of profits to shareholders from 2023 to 2025, leading to a projected dividend yield of 5.2% in 2024, which is among the highest in the highway industry [2] - The company believes it can effectively extend the remaining toll collection periods and expand its highway business through strategic investments, despite market concerns regarding the short remaining periods of core road assets [2] Potential Catalysts - Key catalysts for growth include the completion of the Chengle Expressway expansion and ongoing asset acquisitions [3] Earnings Forecast and Valuation - The company is projected to have EPS of 0.51 CNY and 0.54 CNY for 2025 and 2026, respectively, with a CAGR of 6.3% from 2024 to 2026 [4] - Using a dividend yield approach, the target price for A-shares is set at 6.85 CNY, reflecting a 21.9% upside potential, while the target price for H-shares is 5.61 HKD, indicating a 14.5% upside potential [4]

Core Points - The Nepalese Parliament's Finance Committee has completed a line-by-line discussion of the draft "Alternative Development Fund (ADF) Operations Bill" [1] - Key adjustments include the establishment of a 5-member guiding committee led by the Finance Minister, replacing the previous board led by the Finance Secretary, to enhance political accountability and inter-agency coordination [1] - The investment scope of the fund has been expanded from large infrastructure projects like hydropower and highways to include agriculture, forestry products, and mining industries [1] - Provincial and local governments are now allowed to purchase shares in the fund, whereas previously only the federal government held a majority stake [1] - The fund has a statutory capital of 100 billion Nepalese Rupees, with 25 billion Rupees paid in [1] - The responsibilities of the guiding committee are not yet clearly defined, and Parliament has requested the Finance Ministry to clarify its authority [1] - The fund aims to fill funding gaps in infrastructure projects through mixed financing methods, but there are concerns among parliament members about a lack of clear governance leading to potential opacity [1]

Core Insights - Greece requires an investment of approximately €29 billion (about 12% of GDP) over the next decade for infrastructure development [1] Infrastructure Investment Breakdown - The investment allocation includes €21.3 billion for road infrastructure [1] - €3.7 billion is designated for port development [1] - €2.43 billion is planned for railway improvements [1] - Remaining funds will be allocated to airports, digital and communication systems, as well as water supply and sewage treatment systems [1]

Core Viewpoint - The high dividend sectors in the Hong Kong stock market have long-term investment value under the current liquidity easing environment, driven by stable earnings in banks and improved supply-demand dynamics in midstream material industries [1] Group 1: High Dividend Sectors - High dividend stocks continue to attract low-cost capital inflows due to declining non-standard investment returns [1] - The banking sector maintains stable profitability and dividend levels, contributing to the attractiveness of high dividend stocks [1] - The PPI stabilization expectations enhance the profitability recovery of companies in the midstream materials sector, such as coke and rebar [1] Group 2: Insurance Sector - The insurance sector shows a strong trend towards concentration among leading companies, with improved performance certainty driven by long-cycle assessments and interest rate cuts [1] Group 3: Investment Products - The Hong Kong Stock Connect High Dividend ETF (159331) tracks the Hong Kong Stock Connect High Dividend Index (930914), which selects 30 liquid stocks with high dividend yields [1] - The index primarily covers traditional high dividend sectors such as banking, ports, and highways, while also including industrial metals and telecom operators [1] - Investors without stock accounts can consider the Cathay CSI Hong Kong Stock Connect High Dividend Investment ETF linked A (022274) and C (022275) [1]

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the **express delivery and logistics industry** in China, with a focus on the impact of recent regulatory changes and market dynamics on various companies within the sector [1][2][3]. Core Insights and Arguments - **Price Increases in Express Delivery**: The express delivery industry is witnessing initial success in reversing the trend of price undercutting, with multiple regions experiencing price hikes due to severe losses among franchisees and regulatory pressure for market stability. This price increase is expected to be more sustainable compared to the isolated price hikes in Yiwu in 2021, benefiting from the upcoming peak demand season [1][6][7]. - **Recommendations for E-commerce Delivery Companies**: Companies with strong service quality and cash flow, such as **ZTO Express** and **YTO Express**, are recommended. Additionally, **J&T Express** is highlighted for its competitive position in Southeast Asia, while **SF Express** is noted for its stable high-end service business [1][8]. - **Cross-border E-commerce Logistics**: The volume of air cargo to the U.S. has recovered to 70% of pre-tariff levels, which is better than expected. Eastern Airlines Logistics is performing well with high load factors, and despite a decrease in freight rates, the situation remains favorable. A dividend yield of 4.7% suggests a potential investment opportunity if tariffs improve or volumes increase [1][9]. - **Airline Sector Performance**: The airline sector is experiencing weak ticket prices but good passenger volumes. The fundamentals are well-reflected, and factors like oil prices and exchange rates may provide benefits. **Huaxia Airlines** is recommended due to its leading position in regional aviation and improved subsidy standards, which enhance profit certainty [1][23]. - **Rail Freight Outlook**: **Tielong Logistics** is favored due to its special container business benefiting from equipment upgrades and strong synergy with upstream steel companies. The potential for profit elasticity exists due to the ongoing reversal of price undercutting [1][21][22]. Additional Important Insights - **July Performance of the Transportation Sector**: The overall transportation sector saw a decline of 0.2%, underperforming the CSI 800 index by 4.2 percentage points. Sub-sectors like airports, shipping, and logistics performed relatively well, with increases of 4.3%, 2.4%, and 1.2%, respectively [2]. - **Market Sentiment and Future Recommendations**: The call suggests a continued focus on companies benefiting from the reversal of price undercutting in express delivery, core assets in aviation and express sectors, and stocks in cross-border logistics with potential catalysts from mid-year earnings reports [3]. - **Logistics Sector Performance**: The logistics sector saw a 1.2% increase, with road freight leading at 5.9%. Cross-border logistics rose by 3.3%, while express delivery only increased by 0.6%, reflecting market skepticism about the sustainability of the recovery [5]. - **Future Trends in Container Shipping**: Container shipping rates have shown a downward trend in July, with expectations of continued pressure in August due to high base effects and tariff impacts. The overall volume is expected to stabilize, but rates may continue to decline [12]. - **Air Cargo Market Dynamics**: The air cargo market is expected to maintain low supply levels, particularly for long-haul routes, while domestic airlines are enhancing their logistics capabilities. Positive outcomes from U.S.-China negotiations could serve as a catalyst for growth [30]. - **Investment Recommendations for Airport Stocks**: The airport sector is advised to focus on companies with stable earnings and high dividend yields, especially in light of recent performance and potential geopolitical events that could impact market conditions [15][31]. This summary encapsulates the key points discussed in the conference call, providing insights into the current state and future outlook of the express delivery and logistics industry.