Investment Rating - The report maintains a recommendation for the express delivery industry, indicating a positive outlook for investment opportunities in the sector [1]. Core Insights - The express delivery industry is experiencing price increases due to rising oil prices and a trend against excessive competition, with multiple regions implementing price hikes [1][10]. - The industry is entering a new phase of high-quality development, focusing on improving service quality and maintaining stable pricing, which is expected to benefit leading companies [3][84]. - The volume growth in the express delivery sector is gradually recovering, with a notable increase in the growth rate of delivery volumes in early 2026 compared to the previous year [2][12]. Summary by Sections Price Adjustments - Multiple express delivery companies have raised prices in response to increased transportation costs due to rising oil prices, with adjustments starting from March 23, 2026, in various provinces [1][10]. - The price adjustments reflect a broader trend of stabilizing prices in the industry, with significant increases in single-package revenue reported by major companies [2][11]. Volume Growth - The growth rate of express delivery volumes has shown signs of recovery, with January and February 2026 reporting a 7.1% increase compared to previous months [2][12]. - Major companies like YTO and ZTO have outperformed the market in terms of volume growth, indicating a strengthening competitive position [15][16]. Market Positioning - Leading companies in the express delivery sector are expected to gain market share as they benefit from improved volume structures and pricing strategies [3][13]. - ZTO is highlighted as a key player with a commitment to enhancing investor returns, while YTO continues to show strong performance metrics [18][19][86]. Investment Recommendations - The report suggests continued investment in leading express delivery companies such as ZTO, YTO, and Shentong, emphasizing their potential for growth in the evolving market landscape [3][20][21]. - The report also highlights the importance of maintaining a focus on performance elasticity and dividend value in the transportation sector, particularly in shipping and express delivery [7][82].

Investment Rating - The report maintains a recommendation for the express delivery industry, indicating a positive outlook for investment opportunities in the sector [1]. Core Insights - The express delivery industry is experiencing price increases due to rising oil prices and a trend against excessive competition, with multiple regions implementing price hikes [1][10]. - The industry is entering a new phase of high-quality development, focusing on improving service quality and maintaining stable pricing, which is expected to benefit leading companies [3][17]. - The volume growth in the express delivery sector is gradually recovering, with a notable increase in the growth rate of delivery volumes in early 2026 [2][12]. Summary by Sections Price Adjustments and Market Dynamics - Multiple express delivery companies have raised prices in response to increased transportation costs from rising oil prices, with adjustments starting from March 23, 2026, in various provinces [1][10]. - The price adjustments reflect a broader trend of stabilizing prices in the industry, with significant increases in single-package revenue reported for major companies [2][11]. Volume Growth and Market Share - The growth rate of delivery volumes has shown signs of recovery, with January and February 2026 reporting a 7.1% increase, which is better than previous expectations [2][12]. - Leading companies like YTO and ZTO have outperformed the market in terms of volume growth, with YTO's growth rates significantly exceeding the industry average [15][16]. Investment Recommendations - The report suggests continued investment in leading express delivery companies such as ZTO, YTO, and Shentong, highlighting ZTO's commitment to increasing investor returns and YTO's strong performance metrics [3][18][19]. - The report also emphasizes the potential for growth in the Southeast Asian market through Jitu Express, which is positioned as a key player in the region [20]. - Opportunities in SF Express are noted, particularly in relation to its strategic adjustments and collaborations with Jitu Express [21].

Investment Rating - The investment rating for the company is maintained as "Hold" for A-shares and "Buy" for H-shares [7]. Core Views - The company's 2025 revenue reached 9.264 billion RMB, a year-on-year increase of 0.20%, while the net profit attributable to shareholders was 1.149 billion RMB, up 0.38% year-on-year. However, the company recorded a one-time impairment loss of 653 million RMB, impacting net profit by 587 million RMB, leading to results below expectations by 617 million RMB [1][2]. - The company plans to distribute a dividend of 0.244 RMB per share for the 2025 fiscal year, with a payout ratio of approximately 58.85%, resulting in dividend yields of 2.7% for A-shares and 3.7% for H-shares [1][5]. Revenue and Profitability - The toll revenue for 2025 increased by 1.4% year-on-year, and after excluding the impact of the exit of Yichang Expressway in March 2024, the adjusted toll revenue grew by 3.15% due to the opening of Jiangsu Phase II and favorable weather conditions [2]. - The gross margin for the highway business decreased by 5.2% year-on-year, primarily due to increased amortization and maintenance costs [2]. - The clean energy generation business remained stable, with revenue and gross profit showing a slight decline of 0.9% and an increase of 2.2%, respectively [3]. Capital Expenditure and Financial Health - The company raised 4.7 billion RMB through a private placement in 2025, reducing the debt-to-asset ratio from 59.7% at the beginning of the year to 55.0% by year-end [4]. - The capital expenditure plan for 2026-2028 is projected to reach 18.1 billion RMB, primarily directed towards new and expanded road projects and waste treatment initiatives [4]. Earnings Forecast and Valuation - The net profit forecasts for 2026 and 2027 have been revised down by 4.6% and 6.0% to 1.78 billion RMB and 1.58 billion RMB, respectively, with an initial forecast for 2028 set at 1.5 billion RMB [5]. - The target prices for A-shares and H-shares are set at 10.20 RMB and 8.50 HKD, respectively, reflecting a decrease from previous estimates [5][13].

Investment Rating - The investment rating for the company is maintained as "Hold" for A-shares and "Buy" for H-shares [7]. Core Views - The company's 2025 revenue reached 9.264 billion RMB, a year-on-year increase of 0.20%, while the net profit attributable to shareholders was 1.149 billion RMB, up 0.38% year-on-year. However, the company recorded a one-time impairment loss of 653 million RMB, impacting net profit by 587 million RMB, leading to results below expectations by 617 million RMB [1][2]. - The company plans to distribute a dividend of 0.244 RMB per share for the 2025 fiscal year, with a payout ratio of approximately 58.85%, resulting in dividend yields of 2.7% for A-shares and 3.7% for H-shares [1][5]. Summary by Sections Revenue and Profitability - The company's toll revenue increased by 1.4% year-on-year, and after excluding the impact of the exit of Yichang Expressway, the adjusted toll revenue grew by 3.15%. This growth was attributed to the opening of the Jiangsu section and favorable weather conditions [2]. - The gross margin for the highway business decreased by 5.2%, primarily due to increased amortization and maintenance costs. The clean energy generation business remained stable, while the solid waste resource recovery business showed a slight turnaround [1][3]. Environmental Business - In the environmental sector, the clean energy generation revenue and gross profit decreased by 0.9% and increased by 2.2%, respectively. The kitchen waste treatment revenue and gross profit grew by 20% and turned profitable, mainly due to the commercial operation of the Guangming Environmental Park and rising oil prices [3]. - The subsidiary, Lande Environmental, reduced its losses to 196 million RMB in 2025 from 397 million RMB in 2024, indicating a near break-even point [3]. Capital Expenditure and Financial Health - The company raised 4.7 billion RMB through a private placement in 2025, reducing its debt-to-asset ratio from 59.7% at the beginning of the year to 55.0% by year-end. However, the company has significant capital expenditure plans of 18.1 billion RMB from 2026 to 2028, which may lead to a slight increase in the debt-to-asset ratio to 56.5% by the end of 2028 [4][5]. Profit Forecast and Valuation - The net profit forecasts for 2026 and 2027 have been revised down by 4.6% and 6.0% to 1.78 billion RMB and 1.58 billion RMB, respectively. The 2028 net profit forecast is introduced at 1.5 billion RMB. The target prices for A-shares and H-shares are set at 10.2 RMB and 8.5 HKD, respectively [5][7].

Investment Rating - The report does not explicitly provide an investment rating for the transportation sector Core Views - The transportation index decreased by 2.2% during the week of March 14-20, 2026, underperforming the Shanghai Composite Index by 0.2% [1] - The logistics sector is expected to improve due to rising chemical prices, with a focus on companies like Milkyway, Hongchuan Wisdom, and others [3] - The air travel sector is seeing a recovery with a 3.34% increase in planned international passenger flights for the summer season of 2026 [4] - The shipping sector is facing geopolitical pressures, but the oil transportation index remains high due to geopolitical factors [5] - The road and rail sectors are showing resilience, with increased truck traffic and a focus on coal transportation [6] Summary by Sections Transportation Market Review - The transportation index fell by 2.2%, while the Shanghai Composite Index dropped by 2.4%, ranking 5th out of 29 sectors [1][13] Industry Fundamental Status Tracking Shipping and Ports - The export container shipping market is under pressure from geopolitical tensions, with the CCFI index at 1120.61 points, up 4.5% week-on-week but down 6.0% year-on-year [5][22] - The oil transportation index BDTI increased to 2849.2 points, reflecting a 1.3% week-on-week rise and a 194.6% year-on-year increase [39] Aviation and Airports - The average daily flights increased by 4.79% year-on-year, with domestic flights up by 17.85% [4] - The Brent crude oil price rose to $112.19 per barrel, impacting operational costs for airlines [74] Rail and Road - National railway passenger volume increased by 10.53% year-on-year, while freight volume saw a slight decline of 0.59% [86] - The number of trucks on highways increased by 14.75% week-on-week, indicating a robust road transport sector [90] Express and Logistics - The express delivery sector saw a revenue increase of 7.9% year-on-year, with major companies like Zhongtong Express expected to recover in market share and profitability [2]

Investment Rating - The report maintains a "Recommendation" rating for the transportation industry, indicating an expected increase in the industry index exceeding the benchmark index by more than 5% in the next 3-6 months [78]. Core Insights - The report highlights the significant impact of the ongoing Middle East conflict on shipping rates, with oil tanker rates experiencing a decline but remaining at historical highs, while container shipping rates are on the rise [1][2]. - The daily average of vessels passing through the Strait of Hormuz has drastically decreased by 95% to 5 vessels, compared to 125 vessels before the conflict, with oil tankers averaging only 1 vessel per day [1][11]. - Brent crude oil futures have shown substantial volatility, closing at $103.89 per barrel, an increase of 11% from March 6 [1][15]. Industry Data Tracking Shipping Market Impact - Oil shipping rates have adjusted from historical highs, with the Clarksons VLCC-TCE index at $175,000, down 54.2% week-on-week. The Middle East to China route is reported at $390,000 per day, down 17% [2][18]. - Container shipping rates have increased, with the SCFI index reaching 1710 points, up 14.9% week-on-week, driven by rising fuel costs and the ongoing geopolitical situation [2][25]. - The dry bulk shipping market has seen limited impact, with the BDI index at 2028 points, reflecting a 0.9% increase week-on-week [2][26]. Investment Recommendations - The report suggests that if the Middle East conflict remains manageable and the passage through the Strait of Hormuz gradually resumes, it could trigger a replenishment market. The report continues to recommend companies such as China Merchants Energy and COSCO Shipping Energy [3][31]. - Emphasis is placed on the importance of energy resource security, with recommendations for logistics and warehousing companies like Hongchuan Wisdom and Milky Way [3][31]. - The report also highlights the potential for growth in the aviation sector, with a focus on major airlines and logistics companies, suggesting a favorable outlook for companies like China Southern Airlines and Spring Airlines [4][58].

Investment Rating - The report maintains a "Recommendation" rating for the transportation industry, indicating an expected increase in the industry index by more than 5% over the next 3-6 months compared to the benchmark index [78]. Core Insights - The report highlights the significant impact of the ongoing Middle East conflict on shipping rates, with oil tanker rates experiencing a decline but remaining at historically high levels, while container shipping rates are on the rise [1][2]. - The daily average of vessels passing through the Strait of Hormuz has dropped by 95% to 5 vessels, with oil tankers averaging only 1 vessel per day, a decrease from 40 vessels prior to the conflict [1][11]. - The report notes that Saudi Arabia's Red Sea Yanbu Port is expected to add 3-4 million barrels per day in export capacity, while Iran continues to export 2 million barrels per day through the Strait of Hormuz [1][11]. - Brent crude oil futures saw significant fluctuations, closing at $103.89 per barrel, an 11% increase from March 6 [1][15]. Shipping Market Impact - Oil shipping rates have adjusted from their highs, with the Clarksons VLCC-TCE index at $175,000, down 54.2% week-on-week. The Middle East to China route is reported at $390,000 per day, down 17% [2][18]. - Container shipping rates have increased, with the SCFI index reaching 1710 points, a 14.9% week-on-week rise, driven by geopolitical tensions and rising fuel costs [2][25]. - The dry bulk shipping market has shown limited impact, with the BDI index at 2028 points, reflecting a 0.9% week-on-week increase [2][26]. Investment Recommendations - The report suggests that if the Middle East conflict remains manageable and the Strait of Hormuz traffic gradually recovers, it could lead to a replenishment market. The report continues to recommend companies such as China Merchants Energy and COSCO Shipping Energy [3][31]. - Emphasis is placed on the importance of energy resource security, with recommendations for logistics and warehousing companies like Hongchuan Wisdom and Milky Way [3][31]. - The report also highlights the potential for growth in the aviation sector, with domestic passenger volume increasing by 4.6% year-on-year during the Spring Festival period [32][34]. Industry Data Tracking - Domestic aviation passenger volume averaged 2.36 million per day during the Spring Festival, reflecting a 4.6% year-on-year increase [32][34]. - The report notes a decrease in outbound air cargo prices at Shanghai Pudong Airport, with a week-on-week drop of 9.7% but a year-on-year increase of 0.2% [51].

Investment Rating - The report maintains a "Buy" recommendation for the oil shipping sector, indicating a positive outlook for mid-term market conditions [4]. Core Insights - The ongoing conflict in the Middle East has significantly increased tanker freight rates, with a notable rise in oil prices and shipping costs [2][4]. - The volume of vessels passing through the Strait of Hormuz has drastically decreased due to ongoing threats and insurance cancellations, with a reported average decline of over 90% from March 2 to March 5 [1][17]. - The report highlights that geopolitical tensions are driving up shipping prices, with VLCC (Very Large Crude Carrier) rates reaching historical highs [2][4]. Summary by Sections Section 1: Focus on Oil Shipping - The Strait of Hormuz is a critical passage for global oil trade, accounting for approximately 38% of maritime crude oil trade [13]. - The average number of vessels passing through the Strait has dropped to about 14, compared to a two-month average of 145 vessels, indicating severe disruptions [17]. - Oil prices have surged, with Brent crude reaching $93 per barrel, a 12% increase since the end of February [2][23]. - VLCC-TCE rates have skyrocketed to $380,000 per day, marking a 91.2% week-on-week increase, with Middle East to China routes quoted at $470,000 per day [2][23]. Section 2: Industry Data Tracking - Domestic civil aviation passenger volume increased by 5.9% year-on-year during the Spring Festival period, with average ticket prices rising by 3.3% [42]. - The outbound air cargo price index at Shanghai Pudong Airport rose by 0.3% week-on-week and 8.8% year-on-year [63]. Section 3: Investment Recommendations - The report emphasizes two investment themes for 2026: "performance elasticity" and "dividend value" [9]. - In shipping, the report suggests focusing on the supply-demand gap, particularly in oil and dry bulk shipping, as geopolitical risks and compliance market conditions improve [66]. - For aviation, the report highlights the potential for high elasticity in ticket prices due to supply constraints and rising passenger demand [70]. - In logistics, the report recommends leading express delivery companies like ZTO and YTO, as well as the high-growth potential of SF Express in the instant delivery sector [72][73].

Investment Rating - The report maintains a "Buy" recommendation for the oil shipping sector, indicating a positive outlook for mid-term market conditions [4]. Core Insights - The ongoing conflict in the Middle East has significantly increased tanker freight rates, with a notable rise in oil prices and shipping costs [2][4]. - The shipping volume through the Strait of Hormuz has drastically decreased due to ongoing threats and insurance cancellations, impacting global oil supply [1][17]. - The report highlights the potential for a supply-demand gap in the shipping market, driven by geopolitical risks and increased compliance requirements [4][66]. Summary by Sections Section 1: Focus on Oil Shipping - The Strait of Hormuz, a critical passage for global oil trade, has seen a more than 90% drop in vessel traffic due to security threats [1][17]. - At least 12 vessels have been confirmed attacked, leading to temporary disruptions in port operations and oil production in Iraq [20][22]. - Brent crude oil prices rose to $93 per barrel, a 12% increase from late February, while VLCC-TCE rates reached $380,000 per day, marking a historical high [2][23]. Section 2: Industry Data Tracking - Domestic civil aviation passenger volume increased by 5.9% year-on-year during the Spring Festival period, with ticket prices also rising [42]. - The outbound air cargo price index at Shanghai Pudong Airport increased by 0.3% week-on-week and 8.8% year-on-year [63]. Section 3: Investment Recommendations - The report emphasizes two investment themes for 2026: "performance elasticity" and "dividend value" [9]. - In shipping, the report suggests focusing on oil and dry bulk sectors, highlighting the potential for increased market activity due to geopolitical risks and compliance improvements [66]. - For aviation, the report recommends major airlines and low-cost carriers, anticipating a rebound in passenger demand and operational efficiency [68][70]. - In logistics, the report identifies opportunities in leading express delivery companies, particularly in the context of e-commerce growth [71][72]. Section 4: Dividend Assets - The report suggests focusing on highway and port companies with strong dividend potential, highlighting firms like Sichuan Chengyu and Zhanjiang Port as key investment targets [73][74].

Financial Data and Key Metrics Changes - Revenue reached EUR 9.6 billion, up 8.6% year-over-year on a like-for-like basis, driven mainly by high revenues in highways and construction [6][7] - Adjusted EBITDA stood at EUR 1.5 billion, representing a 12.2% year-over-year increase on a like-for-like basis [7] - Dividends from projects reached a record EUR 968 million, showing a 2.2% increase year-over-year [8] - Total shareholder return in 2025 reached an outstanding 38.6% [8] Business Line Data and Key Metrics Changes - Highways revenue grew 13.7% like-for-like in the year, while adjusted EBITDA was up 12.2%, driven by strong double-digit growth from U.S. assets [11] - Construction revenue reached EUR 7.7 billion, up 7.5% in like-for-like terms compared to 2024, with adjusted EBITDA increasing by 19.9% [26] - The construction order book reached a new all-time high of EUR 17.4 billion, with almost 50% coming from North America [7][27] Market Data and Key Metrics Changes - U.S. highways revenue grew 14.2% in like-for-like terms in 2025 compared to the previous year [12] - Traffic in the Greater Toronto Area is expected to expand 22% by 2051, supporting long-term growth prospects [21] - The Dallas-Fort Worth region is projected to surpass Chicago and become the third largest metropolitan area in the U.S. by 2050 [22] Company Strategy and Development Direction - The company focuses on enhancing customer segmentation and maximizing EBITDA through targeted promotions [39] - A capital rotation strategy is in place, focusing on mature assets to reinvest in attractive opportunities [11] - The company remains selective in pursuing opportunities where its capabilities provide a clear competitive advantage [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term prospects of North American infrastructure assets, particularly in highways [9] - The company is facing a record pipeline of infrastructure projects in the U.S., larger than anything seen before [10] - The outlook for the construction division maintains an average long-term target of 3.5% adjusted EBIT margin [28] Other Important Information - The company returned EUR 156 million in cash to shareholders and repurchased shares totaling EUR 501 million [5] - The New Terminal One project at JFK Airport is progressing towards operational readiness, with a target completion date for the first phase set for fall 2026 [24][25] Q&A Session Summary Question: Can you elaborate on the revenue per transaction for the 407 ETR and its impact on 2026? - Management noted that the fourth quarter's revenue per transaction was affected by seasonality and weather, and it is too early to determine if this trend will continue into 2026 [41][44] Question: What are the reasons behind the provision for lifetime expected credit loss of the 407 ETR? - Management explained that the provision was due to changes in collection processes, but collections have returned to normal levels [49][51] Question: What is the outlook for pricing on the I-66 and I-77? - Management indicated that toll rates for I-66 are expected to increase above inflation, based on user value and economic activity [66] Question: What drove the strong Q4 performance in construction? - Management attributed the strong performance to positive developments in certain markets and change orders that occurred in the fourth quarter [65][68] Question: Will there be any pushback regarding the toll rate increase for the 407? - Management stated that there has been no significant pushback regarding the toll rate increase and that promotions will continue to be a focus [72][73]