Investment Rating - The report maintains a "Strong Buy" rating for ZTO Express [5][9]. Core Views - The company reported a Q2 net profit of 2.053 billion yuan, a year-on-year decline of 26.8%, with a business volume of 9.847 billion pieces, representing a 16.5% increase year-on-year [1]. - The company has adjusted its full-year business volume guidance to 38.8-40.1 billion pieces, reflecting a year-on-year growth of 14%-18%, down from the previous guidance of 40.8-42.2 billion pieces [1]. - The report highlights that the company is focusing on quality over quantity in a competitive pricing environment, which has led to a decrease in market share by 0.1 percentage points to 19.5% [1]. Summary by Sections Business Performance - In Q2, the company's single-ticket revenue decreased from 1.24 yuan to 1.18 yuan, primarily due to increased incentives and a decline in average weight [2]. - The single-ticket core cost increased by 8.6% year-on-year to 0.89 yuan, while the core cost (transportation + sorting) decreased by 0.07 yuan [2][3]. - The single-ticket gross profit fell from 0.42 yuan to 0.29 yuan, indicating significant pressure from pricing competition [3]. Financial Forecast and Valuation - The projected net profits for 2025-2027 are 8.85 billion, 10.22 billion, and 11.53 billion yuan, with corresponding P/E ratios of 13.0X, 11.2X, and 10.0X [4]. - The company is expected to maintain a relatively stable profit level despite the ongoing price wars, indicating strong safety margins [4]. Company Overview - ZTO Express is a large group company that integrates express delivery, logistics, e-commerce, and printing services, operating a highly scalable network partner model [6]. - The total market capitalization is approximately 120.778 billion HKD, with a circulating market value of 89.595 billion HKD [6].

Core Viewpoint - YTO Express is focusing on enhancing its core express delivery business while expanding its international logistics capabilities and optimizing its service offerings to improve customer experience and operational efficiency [1][3]. Group 1: Business Performance - In the first half of 2025, YTO Express completed a total of 14.863 billion express deliveries, representing a year-on-year growth of 21.79%, which exceeds the industry average growth rate by 2.5 percentage points [2]. - The company achieved a revenue of 35.883 billion yuan, marking a year-on-year increase of 10.19% [2]. - The net profit attributable to shareholders of the parent company was 1.831 billion yuan, with the express delivery segment contributing 1.985 billion yuan to this figure [2]. Group 2: Operational Network - As of June 30, 2025, YTO Express's express service network covers all 31 provinces, autonomous regions, and municipalities in China, with a coverage rate of 99.93% in cities above the county level [1]. - The company has 5,027 franchisees and over 77,000 active terminal stores, along with 75 self-operated hub transfer centers and 3,345 sets of automated sorting equipment [1]. - The fleet includes nearly 8,300 line-haul transport vehicles, of which 6,733 are owned, and a self-owned airline fleet consisting of 13 aircraft [1]. Group 3: International Development Strategy - YTO Express is actively deepening its international development strategy, focusing on expanding its international network and optimizing cross-border logistics services [1][3]. - The company aims to enhance its comprehensive service capabilities globally by leveraging its overseas stations, professional teams, and diverse fleet [1][3]. - Future plans include expanding overseas operations, particularly in Central Asia, and enhancing the international logistics service chain [4].

Core Viewpoint - Shentong Express has shown significant stock performance with an 82.23% increase year-to-date, despite a recent decline of 3.52% over the last five trading days [1] Company Overview - Shentong Express Co., Ltd. is located in Qingpu District, Shanghai, and was established on November 1, 2001. The company was listed on September 8, 2010. Its main business includes domestic express delivery, general freight, cargo transportation agency, warehousing services, and unloading services [1] - The revenue composition of the company is as follows: paid delivery 57.95%, transit income 36.62%, information services 4.34%, and other income 1.10% [1] Financial Performance - For the period from January to March 2025, Shentong Express achieved operating revenue of 11.999 billion yuan, representing a year-on-year growth of 18.43%. The net profit attributable to the parent company was 236 million yuan, with a year-on-year increase of 24.04% [2] - Since its A-share listing, Shentong Express has distributed a total of 1.614 billion yuan in dividends, with 131 million yuan distributed over the past three years [3] Shareholder Information - As of March 31, 2025, the number of shareholders for Shentong Express was 38,200, a decrease of 19.32% from the previous period. The average circulating shares per person increased by 23.94% to 39,050 shares [2] - The top ten circulating shareholders include Hong Kong Central Clearing Limited, which holds 62.934 million shares, an increase of 2.6301 million shares compared to the previous period [3] Market Activity - On August 27, Shentong Express's stock price rose by 2.00%, reaching 18.34 yuan per share, with a trading volume of 359 million yuan and a turnover rate of 1.36%. The total market capitalization is 28.075 billion yuan [1] - The company has appeared on the "Dragon and Tiger List" once this year, with the most recent appearance on July 25, where it recorded a net purchase of 14.1143 million yuan [1]

Investment Rating - The report maintains a "Strong Buy" rating for ZTO Express [4][3]. Core Views - The company reported a business volume of 8.54 billion pieces in Q1 2025, a year-on-year increase of 19.1%, but market share decreased by 0.4 percentage points to 18.9% [1]. - The focus for 2025 will shift towards increasing market share, with a target business volume of 40.8 to 42.2 billion pieces, representing a year-on-year growth of 20-24% [1]. - The company experienced a decline in single-ticket revenue, dropping from 1.36 CNY in Q1 2024 to 1.25 CNY in Q1 2025, primarily due to increased subsidies and a decrease in single-ticket weight [2]. - Operating expenses significantly decreased to 283 million CNY in Q1 2025 from 735 million CNY in Q1 2024, largely due to government subsidies and tax refunds [2]. - The competitive landscape is intensifying, with a strategy shift back to prioritizing market share, which may lead to slower profit growth in the short term [3]. Financial Projections - The projected net profit for 2025 is 9.52 billion CNY, with corresponding P/E ratios of 10.9X, 9.2X, and 8.2X for 2025, 2026, and 2027 respectively [3]. - Revenue is expected to grow from 38.42 billion CNY in 2023 to 49.90 billion CNY in 2025, reflecting a growth rate of 12.68% [8]. - The net profit margin is projected to be 19.24% in 2025, with a return on equity (ROE) of 15.94% [8].

Investment Rating - The report maintains a "Strong Buy" rating for ZTO Express (02057.HK) [4][3] Core Views - The company reported a business volume of 8.54 billion pieces in Q1 2025, a year-on-year increase of 19.1%, but market share decreased by 0.4 percentage points to 18.9% [1] - The company aims to focus on increasing market share in 2025, despite facing pressure on revenue due to price wars [1][3] - The single ticket revenue decreased by 0.11 CNY, primarily due to increased subsidies and a decline in average weight per ticket [2] - The company’s core costs per ticket showed a notable decrease, with transportation costs dropping from 0.47 CNY to 0.41 CNY [2] - Operating expenses significantly decreased due to government subsidies and tax refunds, totaling 283 million CNY in Q1 2025 compared to 735 million CNY in Q1 2024 [2] Summary by Sections Business Performance - In Q1 2025, ZTO Express achieved a business volume growth of 19.1%, although this was slightly below the industry growth rate of 21.6% [1] - The company maintains its guidance for a total business volume of 40.8 to 42.2 billion pieces for 2025, representing a year-on-year growth of 20-24% [1] Revenue and Costs - The single ticket revenue fell to 1.25 CNY in Q1 2025 from 1.36 CNY in Q1 2024, influenced by increased subsidies and a decrease in ticket weight [2] - The core cost per ticket remained stable at 0.94 CNY, with a reduction in transportation and sorting costs [2] Strategic Focus - The company is shifting its strategy back to prioritizing market share over profitability in response to intensified price competition [3] - The report anticipates that while market share may recover, profit growth will slow down due to ongoing price wars [3] Financial Forecast - The projected net profits for ZTO Express from 2025 to 2027 are 95.2 billion CNY, 112.0 billion CNY, and 126.4 billion CNY, with corresponding P/E ratios of 10.9X, 9.2X, and 8.2X [3][8]