Core Insights - FedEx views China as a core part of its development strategy, citing the country's robust economic growth and potential for market expansion as key opportunities for the company [2][7] - The Chinese supply chain is undergoing significant changes, with advancements in digital transformation and the integration of artificial intelligence, enhancing the resilience and value of the supply chain [3][4] Group 1: Market Potential and Supply Chain Changes - China is recognized for its complete industrial chain, deep division of labor, and efficient collaboration, making it an attractive destination for foreign investment [4] - The Chinese supply chain is evolving with a focus on high-value ecosystems, driven by digital transformation and AI integration [3][4] - In 2024, China's manufacturing scale is projected to remain the largest globally for the 15th consecutive year, highlighting its critical role in the global supply chain [2] Group 2: Investment Plans and Strategic Focus - FedEx plans to enhance its routes from China to Europe, capitalizing on the growing trade between China and the EU, which saw imports and exports reach 2.82 trillion yuan in the first half of the year, a 3.5% increase year-on-year [6] - The company aims to upgrade its network in the Asia-Pacific region to support increasing transportation demands between China and Southeast Asia, following the completion of the RCEP 3.0 negotiations [6] - FedEx is focusing on empowering the supply chain in key areas such as cross-border e-commerce and heavy freight transportation, providing solutions for B2B and B2C exports and imports [6] Group 3: Sustainability Initiatives - FedEx is actively implementing green initiatives in China, with 20% of its delivery fleet now electric vehicles, and aims for global carbon neutrality by 2040 [8][10] - The company has received LEED Gold certification for its Shanghai headquarters, showcasing its commitment to sustainable infrastructure [8] - FedEx is also providing tools to help clients track their carbon emissions, supporting their sustainability goals [8][10] Group 4: Challenges and Opportunities in Green Logistics - The logistics industry's transition to green practices is becoming essential due to regulatory and market demands, with the Chinese government promoting green logistics development as part of its broader economic strategy [9][10] - The need for logistics companies to invest in sustainable practices, including infrastructure upgrades and low-carbon technologies, is critical for reducing carbon emissions [10]

Investment Rating - The investment rating for the transportation industry is "Positive" (maintained) [4] Core Views - The express delivery sector shows significant divergence in June data, with a focus on the industry's anti-involution process [3] - The express logistics market is expanding, supported by the national strategy to boost domestic demand, with a year-on-year growth of 15.8% in express delivery volume in June 2025 [5] - The performance of major express companies varies, with SF Express maintaining a business volume growth rate of over 30%, while other companies like YTO Express and Yunda Express show slower growth [4][5] Summary by Sections Express Logistics - In June 2025, the total express delivery volume reached 16.87 billion pieces, a year-on-year increase of 15.8%, with total revenue of 126.32 billion yuan, up 9.0% [5][24] - Major express companies' performance in June: YTO Express (2.627 billion pieces, +19.34%), Yunda Express (2.173 billion pieces, +7.41%), SF Express (1.460 billion pieces, +31.77%) [4][28] - The market share for these companies is 15.6% for YTO, 12.9% for both Yunda and Shentong, and 8.7% for SF Express [4] Air Transportation - The air travel sector is expected to benefit from macroeconomic recovery, with a year-on-year increase of 4.4% in passenger transport volume in June 2025 [52] - Major airlines are projected to improve their performance in Q2 2025 due to better supply-demand dynamics and lower oil prices [8] Shipping and Ports - The shipping sector is anticipated to benefit from OPEC+ production increases and a favorable economic environment, with a focus on crude oil transportation [16] - The Baltic Dry Index (BDI) increased by 27.8% week-on-week, indicating a recovery in the bulk shipping market [11][68] - Container throughput at Chinese ports showed a slight increase in cargo volume but a decrease in container throughput [81] Road and Rail - In June 2025, road freight volume increased by 2.86% year-on-year, while rail freight volume rose by 7.36% [45] - National logistics operations are running smoothly, with a slight increase in freight truck traffic [14] Supply Chain Logistics - Companies like Shenzhen International and Debon Logistics are expected to benefit from strategic transformations and improved profitability [15]

Summary of Key Points from Conference Call Records Industry or Company Involved - **Airline Industry**: White Cloud Airport, Hainan Airlines, China National Aviation, Eastern Airlines, Southern Airlines, Huaxia Airlines - **Shipping Industry**: Jinjiang Shipping, Antong Holdings - **Express Logistics Industry**: Jitu Express, SF Express, Shentong, Yunda, YTO Express - **Chemical Industry**: TDI market, high-speed resin market, various sub-industries - **Steel Industry**: General steel market performance and outlook - **Coal Industry**: Current market conditions and challenges Core Points and Arguments Airline Industry Performance - White Cloud Airport reported a Q2 profit of 450 million yuan, with net profit excluding non-recurring items at 290 million yuan, stable compared to Q1 [3] - Hainan Airlines expects a mid-term profit of 45 to 65 million yuan, despite a slight loss in Q2 [3] - China National Aviation anticipates a mid-term net profit increase of 78% to 90%, driven by fleet expansion and lower fuel prices [3] - Huaxia Airlines showed strong performance with a Q2 profit of approximately 160 million yuan, exceeding expectations [3] Shipping Industry Growth - Jinjiang Shipping's net profit for H1 is expected to be between 780 million to 810 million yuan, a significant increase of 146% to 155% due to rising demand in Southeast Asia [4] - Antong Holdings reported a net profit of 490 million to 540 million yuan, with a growth of 218% to 250% attributed to adjustments in shipping capacity [4] Express Logistics Sector Highlights - Jitu Express saw a 66% increase in package volume in Southeast Asia and a 14.7% increase in China, benefiting from strong TikTok e-commerce growth [5] - SF Express reported a 32% growth in business volume in June, with Shentong surpassing Yunda in revenue for the first time since 2020 [5] Chemical Industry Insights - The chemical industry’s operating rate fell to 71.9%, the lowest in history, with significant implications for older production facilities [8] - TDI market supply has contracted significantly, leading to rapid price increases, though sustainability of these price hikes is uncertain [12] - High-speed resin market demand remains strong, with companies like Shengjun Group expected to see a 50% increase in sales [13] Steel Industry Outlook - The steel industry is experiencing the lowest production and inventory levels historically, with a potential recovery driven by government policies [15] - Major steel companies have seen a 20% increase in stock prices, with expectations of further profit growth in the coming months [15] Coal Industry Challenges and Opportunities - Coal companies reported mixed results, with some facing significant declines while others, like Baotai Long, turned losses into profits [18] - The coal market is currently in a destocking phase, with rising demand from electricity and chemical sectors [19] Other Important but Possibly Overlooked Content - The launch of the official direct sales platform by Hanglv Zongheng APP aims to enhance ticket sales efficiency for airlines, potentially reducing reliance on OTA platforms [6] - The government’s redefinition of old equipment standards in the petrochemical industry may significantly impact sectors with high old capacity ratios [9] - The chemical sector is expected to face downward pressure in Q3, but certain products like refrigerants and high-speed resins are projected to perform well [14] - The Ministry of Industry and Information Technology's supply-side reforms are expected to benefit major oil companies and private refining enterprises [20][21]

Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The company has shown strong growth in business volume and revenue, with June revenue reaching 26.254 billion, a year-on-year increase of 13.43%, and express logistics business volume at 1.46 billion tickets, up 31.77% year-on-year [2][3] - The company has successfully transformed into a comprehensive logistics leader, with new business segments achieving market-leading positions and contributing to revenue and profit improvements [6][7] Summary by Sections Business Performance - In Q2, the company reported a business volume increase of 31.20% year-on-year and revenue growth of 12.41% [3] - The company’s business volume has been accelerating since 2025, significantly outpacing industry growth rates [4] Revenue and Profitability - The total revenue for the company in 2025 is projected to be 315.54 billion, with a year-on-year growth rate of 10.9% [8] - The net profit attributable to the parent company is expected to reach 11.91 billion in 2025, reflecting a year-on-year growth of 17.1% [8] Financial Metrics - The company’s gross margin is projected to improve from 12.8% in 2023 to 14.0% in 2025 [8] - The return on equity (ROE) is expected to increase from 8.9% in 2023 to 12.1% in 2025 [8] Future Outlook - The company is expected to maintain a strong growth trajectory, with net profits projected to reach 14.26 billion in 2026 and 16.85 billion in 2027, representing growth rates of 19.7% and 18.2% respectively [7][8] - The company’s price-to-earnings ratio is projected to decrease from 29.33 in 2023 to 20.28 in 2025, indicating potential value appreciation [8]

Core Viewpoint - The market is skeptical about UPS sustaining its dividend, which currently yields 6.6%, indicating a potential risk of a dividend cut [2][4]. Group 1: Dividend and Market Sentiment - UPS's dividend yield of 6.6% is significantly higher than the 10-Year Treasury yield of approximately 4.5%, creating a historically high spread [2]. - The market's perception suggests that the dividend is at risk, which could lead to a reduction [4]. Group 2: Growth Prospects and Strategic Moves - A potential dividend cut could be beneficial for UPS, allowing the company to focus on its strong growth prospects in healthcare and small to medium-sized business revenue [5]. - The strategy to reduce low or negative margin deliveries for Amazon by 50% from early 2025 to mid-2026 aligns with UPS's goal of maximizing profitability [5]. Group 3: Cash Flow and Investment Opportunities - Cutting the dividend could free up cash for further investments in growth activities and technology improvements, potentially accelerating these initiatives [7]. - Reducing dividend uncertainty may shift investor focus towards UPS's growth opportunities rather than concerns about dividend sustainability [7]. Group 4: Monitoring and Future Guidance - If UPS is compelled to lower its full-year guidance due to increased tariffs and trade conflicts, a dividend reduction could be viewed positively, warranting close monitoring by investors [8].

Core Viewpoint - The company reported a significant increase in revenue and business volume for June 2025, indicating strong growth in its logistics and supply chain operations [1][2]. Group 1: Financial Performance - The total revenue for June 2025 reached RMB 262.54 billion, representing a year-on-year growth of 13.43% compared to RMB 231.45 billion in June 2024 [1]. - The express logistics business revenue grew by 14.24% year-on-year, with business volume increasing by 31.77% [1]. - The supply chain and international business revenue increased by 10.93% year-on-year, contributing to the overall growth [1]. Group 2: Business Strategy - The growth in express logistics is attributed to the company's implementation of activation strategies, increased authorization and incentives for frontline operations, and high-quality service during peak e-commerce promotional seasons [1][2]. - The company leveraged its global network advantages and diversified business layout to adapt to market changes and explore new demands, which supported the growth of supply chain and international operations [2].

Core Viewpoint - SF Holding (002352.SZ) reported significant growth in its express logistics and supply chain businesses, driven by strategic adjustments and global network advantages [1] Group 1: Express Logistics Business - The express logistics business generated revenue of 19.962 billion yuan in June 2025, representing a year-on-year increase of 14.24% [1] - The business volume reached 1.460 billion tickets, showing a year-on-year growth of 31.77% [1] - The average revenue per ticket was 13.67 yuan, which is a decrease of 13.32% compared to the previous year [1] Group 2: Supply Chain and International Business - The supply chain and international business achieved revenue of 6.292 billion yuan, reflecting a year-on-year increase of 10.93% [1] - Growth in this segment is attributed to the company's global network advantages and diversified business layout [1]

Core Viewpoint - The third China International Supply Chain Promotion Expo showcases the commitment of YTO Express to enhance its international supply chain capabilities and expand its global presence through strategic partnerships and innovative logistics solutions [1][4]. Group 1: Company Strategy - YTO Express is implementing a "1+7" global strategy, focusing on building a core hub at the Jiaxing Oriental Tian Di Port and establishing seven regional hubs overseas within the next three years [1][2]. - The company aims to enhance its core capabilities in air transport and overseas networks while collaborating with partners in trunk transportation and customs clearance [1][2]. Group 2: International Business Development - YTO Express is adopting a differentiated development strategy for its international business, targeting markets in Central Asia, Australia, Japan, South Korea, South Asia, and Southeast Asia, particularly in countries involved in the Belt and Road Initiative [2][4]. - The Jiaxing Oriental Tian Di Port project, expected to be completed by 2025, will integrate multiple functions such as air cargo, bonded warehousing, customs services, and aircraft maintenance, significantly improving international logistics efficiency for Chinese enterprises [2]. Group 3: Innovation and Market Position - The company showcased innovative international logistics solutions tailored for high-end manufacturing and cross-border e-commerce, effectively meeting diverse customer needs [4]. - The launch of the "1+7" global strategy signifies a transformation of Chinese express logistics companies from mere transport service providers to global supply chain solution providers [4].

Core Viewpoint - The establishment of the first drone postal route in Henan Province's Anyang City significantly enhances logistics efficiency for remote mountainous areas, addressing the "first mile" and "last mile" delivery challenges. Group 1: Operational Efficiency - The drone postal route operates regularly, transporting mail and goods from the Shiban Yan Town postal branch to surrounding villages with high altitudes and inconvenient transportation [1][4] - Previously, villagers had to walk for four hours to reach Shiban Yan Town, but with the drone service, delivery time has been reduced to just seven minutes [3] - The service covers 11 administrative villages, benefiting over 4,000 villagers by eliminating the historical challenges of logistics in mountainous regions [4] Group 2: Cost and Convenience - The cost of using the drone service is comparable to traditional postal methods, with a standard small package costing around 8 yuan for the first weight and 4 yuan per kilogram for additional weight [5] - The process for villagers to send items via drone is straightforward, requiring only a few steps at the local postal low-altitude logistics station [5][6] Group 3: Market Potential - The regular operation of the drone postal route highlights the potential for low-altitude logistics, with a projected market size reaching over 1,200 billion yuan [8][10] - Complex terrains and inconvenient transportation in various regions of China present a significant opportunity for drone logistics to reduce delivery costs and improve efficiency [8][10]

Group 1 - Fonterra's Greater China region is undergoing a restructuring, merging its consumer brand team with its food service team to optimize operations and enhance synergies [1] - In the Chinese market, Fonterra's food service business significantly outperforms its consumer brand business, with food service revenue of NZD 2.377 billion (approximately RMB 10.133 billion) in FY2024, compared to consumer products revenue of NZD 394 million (approximately RMB 1.68 billion) [1] - The food service business is considered Fonterra's profit driver, generating a tax profit of NZD 299 million (approximately RMB 1.275 billion) in FY2024, while the consumer products segment reported a tax loss of NZD 15 million (approximately RMB 63.945 million) [1] Group 2 - Fonterra is facing intense competitive pressure, particularly from domestic brands like Miaokelando, which reported a 14% year-on-year revenue growth in its food service series, reaching RMB 1.31 billion in 2024 [2][3] - The ongoing price war in the food service sector is exerting downward pressure on prices, affecting Fonterra's profit margins in its food service business, which has already seen a decline in gross margin [4] - The adjustments being made by Fonterra may be just the beginning in response to market changes and competitive dynamics [5]