Summary of Daqin Railway Conference Call Company Overview - **Company**: Daqin Railway - **Industry**: Coal Transportation - **Market Position**: Largest coal transport railway company in China with a 25% market share [2][18] Key Investment Thesis - **Rating**: Overweight (OW) with a price target (PT) of Rmb7.50 by December 2026, indicating a potential upside of approximately 27% [2][18] - **Dividend Yield**: Expected to be around 4% for FY25E/26E, significantly higher than China's risk-free rate of 1.7% [18][67] Financial Performance and Projections - **Recent Performance**: Daqin's share price has underperformed since 2024, declining 6% in 2024 and 13% year-to-date [18] - **Earnings Recovery**: Anticipated inflection point for earnings, dividends per share (DPS), and return on equity (ROE) starting in 2H25, following a period of decline [8][20] - **Earnings Estimates**: Projected revenue growth of 1-3% annually from FY25E to FY27E, with net profit expected to recover after bottoming in FY25E [21][48] Financial Metrics - **Current Valuation**: Trading at approximately 5.3x EV/EBITDA for FY26E, below its historical average of 5.5x, and a P/B ratio of 0.7x [22][18] - **Cash Flow**: Strong free cash flow (FCF) yield of over 10%, with operational cash flow consistently at 1.25x net profit over the past decade [8][66] Shareholder Returns - **Dividend Policy**: Daqin has a robust payout ratio of around 55%, with a commitment to maintain this level [8][62] - **Share Buyback**: Initiated its first-ever buyback plan in 1H25, adding approximately 1% yield to the FY26E dividend yield [8][20] Market Dynamics - **Coal Transportation Demand**: Benefiting from China's shift from road to rail freight, with rail's share of coal transportation increasing to 57% in 2024 [51][52] - **Regulatory Environment**: Facing challenges from decarbonization policies and subdued demand in key markets such as property and steel [8][11] Risks - **Investment Risks**: Includes structural downturns due to decarbonization trends, subdued coal demand, and competition in the coal transportation market [8][11] - **Conservative Forecasts**: The forecasts incorporate a cautious approach with a 1% volume CAGR and a -5% terminal growth rate in the DCF model [8][11] Conclusion - **Outlook**: Daqin Railway is positioned for recovery with a strong commitment to shareholder returns, attractive valuation metrics, and a favorable market shift towards rail transportation. However, it must navigate regulatory challenges and market competition to realize its potential [11][18][22]

Core Insights - MingZhu Logistics Holdings Limited has secured a significant coal transport contract with Ruoqiang Tengyue Logistics Co., Ltd. through its subsidiary, Shenzhen Yangang Mingzhu Supply Chain Management Co. [1][2] - The contract entails providing coal transportation services until March 20, 2030, utilizing approximately 300 trucks during the contract period [2]. Company Overview - MingZhu Logistics Holdings Limited, established in 2002 and headquartered in Shenzhen, China, is recognized as a 4A-rated professional trucking service provider [5]. - The company operates regional logistics terminals in Guangdong Province, offering tailored logistics solutions through a combination of self-owned and subcontracted fleets [5]. Subsidiary Insights - Mingzhu Supply Chain, founded in 2018, focuses on providing integrated logistics solutions aimed at reducing costs and enhancing efficiency within the supply chain [3]. - The subsidiary's recent contract win is seen as a significant milestone, reinforcing its market position and driving growth momentum for the company [3]. Partner Insights - Ruoqiang Logistics specializes in coal transportation, connecting power plants and chemical factories with efficient logistics solutions [4]. - The company emphasizes operational excellence and customer satisfaction, ensuring timely delivery of coal, which is critical for energy and industrial operations [4]. - Ruoqiang Logistics is noted for its strong cash flow management, enabling financial stability and strategic investments [4].