Investment Rating - The report maintains a "Strong Buy" rating for ZTO Express (02057.HK) [2][5] Core Views - The company reported a Q3 business volume of 9.573 billion pieces, a year-on-year increase of 9.8%, while its market share decreased by 0.6 percentage points to 19.4% [3] - Adjusted net profit for Q3 was 2.506 billion yuan, reflecting a year-on-year growth of 5.0% [3] - The company has slightly lowered its business volume guidance for the year to 38.2-38.7 billion pieces, corresponding to a year-on-year growth of 12.3%-13.8% [3] - The trend of "anti-involution" in the industry is shifting competition from quantity to quality, leading to a decline in overall business volume growth [3] - The single ticket revenue increased by 0.02 yuan (1.7%) to 1.21 yuan per ticket in Q3, showing improvement compared to previous quarters [4] - The single ticket core cost decreased by 0.04 yuan, with transportation costs dropping from 0.39 yuan to 0.34 yuan [4] - The company’s parcel business grew over 50% year-on-year, contributing positively to single ticket revenue and costs [5] - Single ticket profitability has started to recover, with adjusted net profit per ticket increasing from 0.21 yuan in Q2 to 0.26 yuan in Q3 [5] - Profit forecasts for 2025-2027 are 9.06 billion, 10.22 billion, and 11.53 billion yuan respectively, with corresponding PE ratios of 13.0X, 11.5X, and 10.2X [5] Summary by Sections Business Performance - Q3 business volume reached 9.573 billion pieces, a 9.8% increase year-on-year, but market share fell to 19.4% [3] - Adjusted net profit for Q3 was 2.506 billion yuan, up 5.0% year-on-year [3] Revenue and Costs - Single ticket revenue rose by 1.7% to 1.21 yuan, with a notable improvement from previous quarters [4] - Single ticket core cost decreased by 0.04 yuan, with transportation costs declining significantly [4] Growth and Profitability - The company’s parcel business saw over 50% growth year-on-year, enhancing overall revenue [5] - Single ticket profitability improved, indicating a positive trend in profit recovery [5] Financial Projections - Expected net profits for 2025-2027 are projected at 9.06 billion, 10.22 billion, and 11.53 billion yuan, with decreasing PE ratios [5]

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].

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]