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.

Core Viewpoint - The Hong Kong Dividend ETF (159331) announced a dividend of 0.3% for this month, with the record date on August 5 and the payment date on August 8 [1]. Group 1: Fund Performance and Investment Strategy - The Hong Kong Dividend ETF (159331) saw a net inflow of 2 million units today, indicating active investment in Hong Kong dividend assets [2]. - Huachuang Securities highlighted that high-dividend sectors in Hong Kong stocks are attractive due to their stable free cash flow generation, which supports dividend capabilities and shareholder returns [2]. - Companies with abundant free cash flow can maintain dividend performance while also enhancing return on equity (ROE) through capital expenditures, offering both defensive and growth characteristics [2]. - Traditional sectors such as banking, ports, and highways are favored for their stable earnings and dividends, especially in a low-interest-rate environment [2]. - Industrial metals benefit from inventory destocking and demand recovery, while telecom operators are experiencing accelerated free cash flow release due to maturing projects and increasing industry penetration [2]. - The valuation of Hong Kong stocks is lower compared to A-shares, and a higher proportion of foreign investment makes them more attractive for international capital allocation, particularly in a weakening dollar environment [2]. Group 2: Dividend Distribution Principles - The fund's distribution principle includes cash dividends, with the management evaluating excess returns relative to benchmarks and available distributable profits for potential distributions [4]. - The fund can distribute profits monthly if the net asset value growth exceeds the benchmark or if distributable profits are positive [4]. - The fund's dividend distribution does not require prior loss compensation, and the net asset value may fall below par after distribution [4]. - Each fund share has equal distribution rights, and any specific regulations from legal or regulatory bodies will take precedence [4].

Core Viewpoint - The article emphasizes the strategic initiative of Liaocheng City to accelerate the construction of a transportation stronghold in Shandong, aiming to enhance its status as a comprehensive transportation hub and support high-quality economic and social development [1] Group 1: Transportation Network Development - Liaocheng has planned a series of strategic transportation projects to strengthen its comprehensive transportation network, focusing on major corridors and hubs to connect with key economic regions [2] - The city is enhancing its connectivity through the construction of high-speed railways and highways, facilitating integration with the Beijing-Tianjin-Hebei region and the Yangtze River Delta [2] Group 2: Infrastructure Achievements - The opening of the Jizheng High-Speed Railway marks Liaocheng's entry into the "high-speed rail era," providing direct access to 17 provincial capitals and municipalities [3] - Significant infrastructure projects include the completion of the city's outer ring road and two major bridges over the Yellow River, which improve regional connectivity and alleviate urban traffic pressure [3] Group 3: Project Advancement - Since the beginning of the 14th Five-Year Plan, several key railway and highway projects have commenced, including the Xiongshan High-Speed Railway and various highway connections, with some expected to be completed by the end of the year [4] - The approval of the Liaocheng Airport project and advancements in multiple highway projects indicate a robust development trajectory for the city's transportation infrastructure [4] Group 4: Public Transportation Improvements - The city has enhanced public transportation services by optimizing bus routes and introducing new services to meet diverse commuting needs, including free bus rides during specific seasons [5] - Initiatives to integrate passenger and freight transport in rural areas have been implemented, improving logistics and accessibility for residents [5] Group 5: Government Service Enhancements - The transportation sector has seen improvements in government service efficiency, with the introduction of a "no proof" policy for various transportation-related permits, streamlining processes for citizens [7] - The city is advancing online service capabilities, allowing for easier access to transportation-related administrative tasks, thereby reducing the need for in-person visits [7]

Financial Data and Key Metrics Changes - The company reported a net debt position of negative €223 million, excluding infrastructure project companies, which does not include proceeds from the divestment of Hydro [5] - Adjusted EBITDA for the construction segment was €191 million, up 4.2% year-over-year, with an adjusted EBIT margin of 3.5%, in line with long-term targets [18][19] - Operating cash flow was negative €104 million in the first half, compared to negative €53 million in the same period last year, primarily due to a lack of advanced payments [19][24] Business Line Data and Key Metrics Changes - Highways revenues grew by 14.9% in the first half on a like-for-like basis, with adjusted EBITDA improving by 17.1%, driven by strong performance from U.S. assets [7][8] - U.S. Highways represented 88% of total highways revenues and 97% of total adjusted EBITDA, with revenue growth of 15.9% and adjusted EBITDA growth of 14% [8] - The construction segment saw revenues reach €3,453 million, a 2.6% increase year-over-year on a like-for-like basis [18] Market Data and Key Metrics Changes - Traffic improved by 5.8% in the second quarter, driven by targeted rush hour promotions, although adverse weather and construction delays impacted performance [10] - At JFK Airport, the new Terminal 1 project is 72% complete, with construction on schedule and on budget [15] - Dalaman Airport in Turkey experienced a slight traffic decline of 0.3% in the first half, influenced by lower domestic passenger volumes [17] Company Strategy and Development Direction - The company continues to focus on growth investments, divestments, and shareholder distributions, with a healthy pipeline of U.S. highways assets [30] - The strategic horizon plan is being executed, with updates on progress expected [30] - The company is optimistic about future opportunities in Poland, particularly with European funds and potential reconstruction efforts in Ukraine [97] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth prospects of North American assets, driven by increased customer segmentation and local economic growth [30] - The company anticipates limited exposure to inflation and a healthy construction order book [30] - Management noted that the competitive environment for U.S. Managed Lanes remains similar to previous years, with expectations for continued success in upcoming bids [70] Other Important Information - The company completed the acquisition of a 5.06% stake in four zero seven ETR for CAD 1.99 billion, increasing its stake from 43.23% to 48.29% [6] - Dividends from North American highways totaled €240 million in the first half, compared to €339 million in the same period last year [9] - The company issued $1.4 billion in long-term green bonds, completing the refinancing of phase A for the NTO project [16] Q&A Session Summary Question: Insights on revenue growth in I-77 and I-66 - Management attributed revenue growth to economic activity and population growth in metropolitan areas, along with the ability to adjust toll rates based on customer value [37][40] Question: Earnings from ProBio Construction - Management noted that the decline in Q2 earnings was due to additional costs related to utilizations and IT systems, with a long-term EBIT margin target of 3.5% [44] Question: Upstream dividends and shareholder returns - Management indicated that dividends from infrastructure projects are tied to asset performance, with a target of €2.2 billion in dividends for the period 2024-2026 [54] Question: Schedule 22 provision and traffic trends - Management explained that the reduction in the Schedule 22 provision was based on updated traffic data and successful promotions attracting more users during peak times [68][80] Question: ETR dividend factors and capital structure - Management confirmed that there is potential for increased dividends from ETR, with room for adjustments in capital structure for I-66 and I-407 [110]

Investment Rating - The report recommends an overweight rating for the transportation industry, expecting a price increase exceeding 10% over the next 6-12 months compared to the market benchmark index [28]. Core Insights - The transportation index increased by 3.18% this week, ranking 11th among 30 primary sub-industries. Year-to-date, the index has risen by 2.59%, ranking 26th [4]. - The airport sector showed the highest growth this week, with a 5.64% increase. Year-to-date, the express delivery, public transport, and shipping sectors have seen increases of 19.01%, 15.20%, and 7.76% respectively [4]. - The CCFI index decreased by 3.24% this week, with the SCFI index down by 3.30%. The average price of pre-sold tickets for the summer travel season is 787 yuan, a decrease of 3.3% year-on-year [4]. - Sichuan Chengyu has initiated the expansion of the Chengya Expressway, with an estimated total investment of approximately 28.55 billion yuan [4]. - Shentong Express plans to acquire 100% of Daniao Logistics for approximately 362 million yuan, with Daniao's revenue for 2024 projected at 12.4 billion yuan [4]. Summary by Sections Industry Performance - The transportation index has shown a cumulative increase of 2.59% from January 2025 to date, with a weekly increase of 3.18% [4]. - The express delivery sector has the highest year-to-date growth at 19.01%, followed by public transport and shipping [4]. Major Events - The CCFI index decreased by 3.24%, while the SCFI index fell by 3.30%. The average ticket price for summer travel is down 3.3% year-on-year [4]. - The expansion project for the Chengya Expressway has a total estimated investment of 28.55 billion yuan, with Sichuan Chengyu contributing 49.02 million yuan [4]. - Shentong Express is set to acquire Daniao Logistics for 362 million yuan, with projected revenues for Daniao in 2024 at 12.4 billion yuan [4]. Investment Recommendations - The report recommends stocks such as JD Logistics, Zhongtong Express, YTO Express, Shentong Express, Spring Airlines, and Sichuan Chengyu for investment [4].