Summary of Trip.com Group Ltd Conference Call Company Overview - **Company**: Trip.com Group Ltd (Ticker: TCOM.O) - **Industry**: China Internet and Other Services - **Market Cap**: US$44.224 billion - **Current Share Price**: US$64.90 (as of January 8, 2025) - **Price Target**: US$81.00, representing a 25% upside potential Key Points 1. Operational Performance - 4Q24 operations were on track, with management confident about revenue growth in the teens for 2025, supported by stable domestic hotel Average Daily Rate (ADR), outbound recovery, and market share gains [1][2][4] - Domestic hotel ADR remained flat year-over-year (YoY) in 4Q24, outperforming the industry which saw a low-single-digit decline [2] 2. Revenue Growth Drivers - Management expects stable ADR in 2025 due to slowing hotel supply growth and a continued strong leisure demand, which constitutes 70-80% of total demand [2] - Corporate travel budgets are expected to remain flat in 2025 [2] 3. Air Ticketing and Travel Consumption - Air ticketing volume grew in high single digits YoY in 4Q24, aligning with industry trends, while prices normalized YoY [3] - Despite recent air crash incidents, travel consumption on the platform remains resilient, with increased spending per user in 2024 [3] 4. Outbound Travel Recovery - Outbound travel growth in 2025 is projected to exceed pre-COVID normalized levels, with international air capacity expected to recover to 100% of 2019 levels by year-end 2025 [4] - The company's recovery rate is 120% compared to 2019, significantly outperforming the industry by 35-40 percentage points [4] 5. Market Share and Tour Offerings - Packaged tours have only recovered to 50-60% of pre-COVID levels, but the rise of self-guided tours is helping the company gain market share in both domestic and outbound travel [5] - Trip.com aims to increase revenue without compromising overall profitability, focusing on volume growth with a take rate of 7-8%, compared to global peers at 15-16% [6] 6. Shareholder Returns - Management plans to enhance total shareholder return from the current 20% of free cash flow (FCF) through a combination of buybacks and dividends [7] 7. Financial Projections - Revenue projections for the next fiscal years are as follows: - 2024: Rmb 52.866 billion - 2025: Rmb 60.519 billion - 2026: Rmb 67.792 billion - Expected EPS for 2025 is Rmb 27.02, with a P/E ratio of 15.8 [8] 8. Risks and Challenges - Potential risks include rising competition from domestic players like Tongcheng Travel and Meituan, macroeconomic uncertainties, and FX headwinds that could lower travel demand [13] 9. Valuation Methodology - Key assumptions include a WACC of 10.5%, terminal growth of 3%, and an FX rate of 7.6 [11] Conclusion Trip.com Group Ltd is positioned for growth in 2025, driven by stable domestic performance, a strong recovery in outbound travel, and strategic focus on increasing market share. However, the company faces competitive and macroeconomic challenges that could impact its performance.

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the global rates market, focusing on the implications of recent economic data and central bank policies on interest rates and bond yields across various regions including the US, Europe, and Japan. Core Insights and Arguments 1. **Market Sentiment on Rates** - The sell-off in rates was led by the front-end following the December payrolls print, indicating a shift in policy pricing that pressures risky assets. The market may be overestimating the upside risks around the rate path, but yields have not yet reached a self-correcting point [1][5][10]. 2. **US Federal Reserve Outlook** - Economists expect the Fed to cut rates only twice in 2025, with cuts anticipated in June and December, reflecting a shift in focus back to inflation risks. The softer average hourly earnings in December contributed to this outlook [2][5]. 3. **Global Yield Trends** - Recent upward pressure on US and global yields has been particularly pronounced in Gilts, with a notable sell-off in GBP currency. The upcoming data releases are critical for determining the trajectory of yields [1][21]. 4. **European Rates Dynamics** - European yields have also increased, influenced by the weakness of the EUR against the USD. The divergence in US-EU rates is attributed to trade policy uncertainties, with expectations of lower European yields over 2025 despite recent sell-offs [11][13]. 5. **UK Gilt Market** - The UK Gilt market faces increased uncertainty due to rising yields and a weakening GBP. The expectation is for the BoE to cut rates more than the market anticipates, which could help absorb elevated duration supply [21][26]. 6. **Japanese Wage Data** - Recent wage data in Japan supports expectations for a rate hike by the BOJ in January, with indications of increasing wage growth momentum. This could lead to higher JPY rates across the curve [22][26]. 7. **Inflation Pricing Vulnerabilities** - Front-end inflation pricing has unwound much of the post-election widening, aligning with forecasts of around 2.5% inflation by year-end. However, there remains vulnerability to tariff concerns that could pressure inflation expectations [10][26]. 8. **Sovereign Spread Reactions** - The recent sell-off in core rates has not led to significant widening in sovereign spreads, indicating a more muted reaction compared to previous instances of bearish impulses from the US [16][26]. Additional Important Insights 1. **Bank Regulation and Treasury Demand** - The potential easing of bank regulations could support demand for Treasuries, with estimates suggesting significant changes in bank demand for USTs based on regulatory adjustments [10][26]. 2. **Market Positioning and Flows** - The report highlights the current market positioning, indicating a mix of bullish and bearish sentiments among investors, with implications for future trading strategies [41][49]. 3. **Forecasts for G10 10-Year Yields** - The forecast for G10 10-year yields shows a gradual decline across various currencies, with specific projections for USD, GBP, and JPY yields over the next quarters [27][30]. 4. **Central Bank Actions and Market Impact** - The anticipated actions of central banks, including the Fed and ECB, are expected to influence market dynamics significantly, with implications for interest rates and economic growth [32][36]. This summary encapsulates the key points discussed in the conference call, providing insights into the current state and future outlook of the global rates market.

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the fund flows in Emerging Markets (EM), particularly in Asia excluding China, and highlights significant trends in foreign institutional investor (FII) activities, domestic retail flows, and mutual fund positioning in various markets, including India and South Korea [1][5][41]. Core Insights and Arguments - **FII Flows**: EM Asia ex-China experienced FII selling of **US$0.5 billion** week-over-week (wow), primarily driven by India, which saw outflows of **US$0.9 billion**. Conversely, South Korea recorded inflows of **US$0.7 billion** [5][41]. - **Southbound Flows**: Southbound flows into Hong Kong saw strong inflows of **US$6.3 billion**, marking the highest weekly buying since February 2021, largely attributed to approximately **US$4 billion** in buying from Tencent [5][23]. - **Domestic Equity Mutual Funds in India**: Domestic equity mutual fund inflows rebounded to **US$4.8 billion** in December from **US$4.3 billion** in November, representing a **13% month-over-month** increase. This marks the eighth consecutive month with inflows exceeding **US$4 billion** [31][37]. - **China Fund Positioning**: Allocations to Chinese equities in global mutual funds remained low, with net allocation at **6.8%**, which is in the **8th percentile** over the past five years. Active mutual funds are underweight in Chinese equities by **300 basis points** [6][18][20]. - **Northbound Holdings**: Data from HKEx indicated a **US$21 billion** outflow in Northbound holdings during the fourth quarter of 2024, primarily in the Utilities, Materials, and Consumer Staples sectors [7][41]. Additional Important Insights - **Sector Performance**: The report highlights that financial services saw significant increases in holdings as a percentage of the listed market cap, while utilities and materials faced the largest outflows [9][10]. - **Top Buying and Selling Stocks**: Notable stocks with significant net buying included CATL and WuXi AppTec, while Wanhua Chemical and Kweichow Moutai were among the top sellers [11][12]. - **Systematic Investment Plans (SIPs)**: Inflows via SIPs in India remained robust at **US$3 billion**, indicating strong retail investor confidence [31][36]. - **Global Equity Mutual Fund Flows**: Globally, equity mutual funds saw inflows of **US$26 billion**, contrasting with outflows of **US$25 billion** the previous week, with US funds contributing **US$11 billion** to the inflows [5][41]. This summary encapsulates the key points from the conference call, providing insights into the current state of fund flows in emerging markets, particularly focusing on the dynamics in India and China.

NORTH AMERICA | Energy Equity Research January 11, 2025 Need Ideas? What's Outperforming / What's Underperforming? This past week, S&P 500 Energy was up ~0.8%, outperforming SPX by ~253bps (+347bps/-1,209bps YTD/LTM). Within sub-sectors, NAM E&P was the best- performing and US Oilfield Services the worst (see below). Inside, we break down 1-week/QTD/YTD/LTM returns for the energy sector (by group and by company) incl E&P, Integrated, Refining, Oilfield Services, Midstream and LNG. We also break down returns ...

Summary of Key Takeaways from China Solar Corporate Day Industry Overview - **Industry**: Solar Energy - **Companies Involved**: JA Solar, Jinko Solar A, Trina Solar, CSI Solar A Key Points 1. **Global Demand Growth**: - Expected global solar installation demand growth of 10%-15% year-over-year, targeting approximately 500 GW in 2025, compared to 9% growth in 2024 [1][2] 2. **US Module Price Hike**: - High likelihood of module price increases in the US market due to local solar cell shortages. Companies anticipate US module prices to rise between US manufacturing costs and ASEAN imported costs, estimating an increase of at least US$0.05/W to US$0.25/W [2][4] 3. **Regulatory Needs**: - More regulations are necessary to address below-cost module price bidding in the domestic market. Current market fragmentation and lack of penalties for illegal bidding practices hinder price increases [5] 4. **Impact of Export Tax Rebate Cut**: - The recent cut in export tax rebates is expected to have a limited impact on module players' profitability, as the rebate is based on value added and current profitability is thin. This could provide a rationale for raising module prices in overseas markets [6] 5. **Capacity Expansion Trends**: - Companies are exploring capacity expansion in diversified regions outside of China, particularly in the Middle East and North Africa, while indicating almost no capacity expansion plans within China, focusing instead on technology upgrades [7] Additional Insights - **China's Growth Outlook**: - Anticipated growth in China is projected at 0%-10%, driven by potential policy stimulus and improved residential solar demand [3] - **Mixed EU Growth**: - European growth expectations vary from 0%-20% year-over-year, influenced by macroeconomic conditions and interest rate changes [3] - **Emerging Markets Demand**: - Continued robust demand is expected in emerging markets such as the Middle East, Asia, and Africa, attributed to attractive solar Levelized Cost of Energy (LCOE) [3]

Summary of Key Points from the Conference Call Industry Overview - The conference call focuses on the **Consumer Staples** sector in **Europe** for the year **2025**. The sector has experienced underperformance, and the elevated interest rate environment is expected to limit its appeal, making idiosyncratic stock calls crucial [1][2][9]. Core Themes and Stock Changes - **Rating Changes**: - **Reckitt**: Upgraded from **Equal-weight** to **Overweight**, new price target set at **£55.00** from **£46.00** [3][40]. - **Diageo**: Maintained **Underweight** rating, new price target increased to **£22.40** from **£22.00**, now a **Top Pick** in Beverages [3][15]. - **Haleon**: Downgraded from **Overweight** to **Equal-weight**, price target adjusted to **£4.10** from **£4.00** [3][14]. - **ABI**: Maintained **Overweight** rating, price target decreased to **€61.50** from **€64.50** [3][15]. - **Stock Preferences**: - Reckitt is highlighted as a **Top Pick** in **Household & Personal Care (HPC)**, while Diageo is noted as a **Top Pick** in **Beverages** [9][15]. Market Dynamics - The **EU Staples** sector is forecasted to see **4.5% EPS growth** in 2025, compared to **4.8%** for **MSCI EU**. The preference is for **HPC/Tobacco** over **Beverages/Food** due to structural and commodity pressures [9][11]. - The sector is trading at approximately **16x NTM P/E**, which is considered cheap historically, but rising bond yields and soft sector organic sales growth (OSG) may keep valuations under pressure [9][11]. Economic and Competitive Landscape - The **2024** performance for EU consumer staples was poor, with major players like **L'Oreal**, **Nestle**, and **Heineken** near their 52-week lows. The sector derated by about **17 points** compared to the broader market [10][11]. - The valuation gap between EU and US consumer staples has widened, with EU Staples trading at a **30% discount** to US counterparts [10][11]. Risks and Challenges - **Idiosyncratic Calls**: The lack of homogeneity within sub-categories suggests a focus on individual stock performance rather than sector-wide trends [11][12]. - **Commodity Costs**: Rising prices for commodities like coffee and cocoa are expected to impact margins, particularly for food producers, making it difficult to pass on costs to consumers [17][18]. - **Tariff Risks**: Spirits companies face potential tariff risks, especially with imports, which could affect profitability [17][18]. Company-Specific Insights - **Reckitt**: Positioned for a transformation with expected **+MSD% LFL growth** and **+HSD% EPS growth** from 2025. The stock is trading at a **30% discount** to Haleon and over **20%** discount to long-term averages [40][49]. - **Litigation Risks**: Ongoing litigation related to infant formula could pose risks, with several trials scheduled through 2026 [51]. Conclusion - The **Consumer Staples** sector in Europe is navigating a challenging environment with idiosyncratic stock selection becoming increasingly important. Companies like **Reckitt** and **Diageo** are positioned for potential growth, while risks from commodity prices and tariffs remain significant [9][10][11].

Summary of J.P. Morgan Oil Markets Weekly (10 January 2025) Industry Overview - The report focuses on the oil market, particularly the impact of U.S. sanctions on the Russian oil industry and the resulting price movements in crude oil [1][5][9]. Key Points Oil Price Movements - Oil prices reached a three-month high, with Brent crude increasing nearly 4% to $80 per barrel and WTI rising to $77 per barrel [1][5]. - The premium of Middle Eastern crudes over Brent has widened [1]. Sanctions on Russian Oil - A total of 451 vessels are now sanctioned, with 183 additional vessels added to the previous 268 [4][16]. - The newly sanctioned vessels include 211 oil-related tankers, which represent just below 16% of the total Russian tanker fleet of approximately 1,342 vessels [4][16]. - In 2023, these 211 vessels transported 1.7 million barrels per day (mbd) of crude oil and 200,000 barrels per day (kbd) of oil products, totaling 1.9 mbd [4][16]. - Over 80% of the crude transported by these vessels was sent to countries that may comply with U.S. sanctions [4][16]. Impact of Sanctions - The sanctions are expected to disrupt Russian oil flows more significantly than previous measures, increasing the cost of doing business with Russia due to the risk of secondary sanctions [13]. - China is reportedly becoming a less permissive buyer of Russian oil, with ports in Shandong province instructed to ban U.S.-sanctioned tankers from docking [13]. - Russia has adapted by acquiring its own fleet of tankers and insuring them domestically, redirecting oil shipments from Europe to Asia [14]. U.S. Inflation and Oil Prices - The sanctions and oil price dynamics have contributed to a significant disinflationary effect in the U.S., accounting for two-thirds of the drop in headline CPI inflation from a peak of 9.1% in June 2022 to 3.4% in December 2023 [10]. - Oil alone contributed 300 basis points to the decline in inflation [10]. Future Outlook - The report suggests that the new sanctions may provide the U.S. administration with leverage in future negotiations with Russia regarding sanctions [19]. - Other oil-producing countries may increase their market share at Russia's expense, with Chinese and Indian refiners seeking alternatives to Iranian and Russian crudes [18]. Price Forecasts - J.P. Morgan's crude oil price forecasts indicate that Brent prices are expected to average $73 per barrel in 2025, with WTI averaging $69 per barrel [31]. Additional Insights - The sanctions allow for a wind-down period, with tankers permitted to unload until February 27, and energy-related transactions continuing until March 12 [16]. - Rosneft and major oil trading companies supplying Russian oil were excluded from the sanctions, allowing them to engage in domestic crude swaps [16]. This summary encapsulates the critical insights from the J.P. Morgan Oil Markets Weekly report, highlighting the current state of the oil market, the implications of sanctions on Russian oil, and the broader economic context.

Summary of the Japan Materials Sector Conference Call Industry Overview - The conference call focuses on the Japan Materials Sector, particularly the chemicals and metals industries, as analyzed by UBS Research [2][11]. Key Points and Arguments Upstream Chemicals - Upstream chemicals remain the top long position by sector, with increasing expectations for domestic business restructuring [2][3]. - The crowding index indicates a strong long position for Nitto Denko and Shin-Etsu Chemical, while SUMCO shows a low crowding index, indicating a bearish sentiment [3][4]. Metals and Trading Companies - Mitsubishi Corp is highlighted as a top long position, while JFE Holdings is noted as a top short position [4][22]. - The bearish stance on the blast furnace industry is emphasized, with Kobe Steel and Furukawa Electric showing interest in value stocks [4][22]. Market Sentiment - The chemicals sector appears to lack direction, with investors assessing macroeconomic factors, particularly the impact of tariffs under the second Trump administration [3][22]. - Defensive stocks are likely to attract attention amid the current market conditions [3][22]. Crowding Factor Analysis - The crowding index ranges from +30 (maximum long) to -30 (maximum short), with significant long positions in upstream chemicals and narrowing short positions in semiconductor materials [2][19]. - The report indicates a narrowing in short positions for Nippon Sanso Holdings and a narrowing in long positions for Sekisui Chemical over the past two months [3][19]. Three-Factor Crowded Momentum Stocks - The Three-Factor crowding momentum strategy combines crowding score, change in crowding, and one-month price momentum to identify potential outperformers and underperformers [21][22]. - Stocks like Mitsubishi Corp and Shin-Etsu Chemical have high scores, while JFE Holdings and Nippon Steel are among those with low scores [22]. Additional Important Insights - The report includes detailed crowding rankings for various materials stocks, indicating the current market positioning and sentiment towards these companies [19][22]. - The analysis suggests that long positions in crowded stocks that are underperforming may yield better returns, while short positions in crowded stocks that are overperforming may underperform [21][22]. This summary encapsulates the key insights from the conference call, providing a comprehensive overview of the current state of the Japan Materials Sector and the implications for investors.

Key Points **Industry Overview** * **Semiconductor Sector Underperformed in 2024**: The Semiconductor sector underperformed the broader market in 2024, driven by moderation in AI stocks and underperformance in Semiconductor Capital Equipment and Analog/MCU. * **Outlook for 2025**: Goldman Sachs expects the Semiconductor and Semiconductor Capital Equipment sectors to outperform the broader market in 2025, driven by sustained outperformance in AI-enablers and a cyclical recovery in areas like Analog Semiconductors, MCUs, and Wafer Fab Equipment. * **Macroeconomic Backdrop**: The firm expects a favorable macroeconomic backdrop in 2025, with global GDP growth forecasted at 2.7%, supporting a cyclical recovery. **Sub-Sector Views** * **Compute/Networking**: AI-enablers like CRDO, NVDA, AVGO, MRVL, and ARM significantly outperformed in 2024. The firm expects demand for Compute and Networking to grow further in 2025/26 as model sizes and complexity evolve. * **Accelerated Computing**: The firm expects high demand for Accelerated Computing in 2025, driven by the ramp of next-generation accelerators and the low base. * **Networking**: Networking companies are expected to benefit from increased data rates and higher attach rates of Networking devices. * **Server CPU**: The general server market is expected to grow modestly in 2025, with AMD gaining share in server CPUs and Arm-based CPUs growing their presence in the Cloud. * **PC CPU**: The firm expects PC CPU shipments to remain soft in the near-term but improve in 2H25 driven by the end of life of Windows 10 and the proliferation of AI PCs. * **Broad-Based Semiconductors**: The firm expects another round of estimate cuts heading into and coming out of 4Q24 earnings season, but believes this will mark the 'last cut' this downturn. * **Automotive Semiconductors**: The firm remains positive on the long-term drivers of through-cycle growth in Automotive semiconductors, including Electrification and ADAS. * **Memory/Storage**: The firm expects industry bits to grow mid-teens (%) yoy in 2025 and pricing to stay relatively soft in the first half with a potential recovery in 2H. * **Semiconductor Capital Equipment**: The firm remains optimistic on the Wafer Fab Equipment market outlook for 2025 and 2026, driven by the transition to N2 at TSMC, continued strength in HBM, and a mild recovery in NAND. * **Semiconductor Materials**: The firm remains optimistic on the sub-sector as a whole and Entegris more specifically over the next 12 months, driven by factors like N2 ramp at TSMC and recovery in traditional end-markets. **Best Positioned Single Stock Ideas** * **NVDA**: The firm reiterates its Buy rating on NVDA, with a 12-month price target of $165 representing 18% potential upside. * **AVGO**: The firm reiterates its Buy rating on AVGO, with a 12-month price target of $255. * **MU**: The firm reiterates its Buy rating on MU, with a 12-month price target of $128. * **LRCX**: The firm maintains its Buy rating on LRCX, with an updated 12-month price target of $85. * **TER**: The firm maintains its Buy rating on TER, with a 12-month price target of $151. * **ENTG**: The firm maintains its Buy rating on ENTG, with an updated 12-month price target of $128. **Downgrades and Upgrades** * **Downgrade AMD to Neutral**: The firm downgrades AMD to Neutral from Buy, with a 12-month price target of $129. * **Upgrade NXPI to Buy**: The firm upgrades NXPI to Buy from Neutral, with an updated 12-month price target of $257. **Key Risks** * **Weaker-than-expected demand**: A weaker-than-expected demand for semiconductors could lead to downside risks for the industry. * **Supply chain disruptions**: Supply chain disruptions could impact production and lead to higher prices. * **Competition**: Intensified competition could impact pricing and margins. * **Regulatory changes**: Regulatory changes could impact the industry and its participants.

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the **container shipping industry** and its current market dynamics, including freight rates, seasonal trends, and the impact of labor agreements on shipping lines. Core Insights and Arguments 1. **Freight Rate Trends**: The Shanghai Container Freight Index (SCFI) dropped by **8.6% week-on-week** due to averted strikes, with expectations of continued downward pressure from weaker seasonal demand [3][10][22]. 2. **General Rate Increases (GRIs)**: Two rounds of GRIs, ranging from **USD 1,000 to USD 3,000 per FEU**, are scheduled for January 15 and February 1, 2025. However, the likelihood of these increases being implemented is low due to the recent labor agreement [3][21][34]. 3. **Seasonal Patterns**: Historically, freight rates decline by an average of **12%** four weeks after the Lunar New Year (LNY). The industry anticipates similar softness in rates in the upcoming months [4][22]. 4. **Capacity Management**: Shipping lines are adopting blank sailings to manage capacity, with a reported **12% cancellation rate** of sailings from December 30 to February 2 [4][22]. 5. **Profitability Outlook**: Despite the anticipated decline in rates, preliminary results from major liners indicate profitability in Q4 2024, with CSH's profit increasing **1.7x year-on-year** to **RMB 49 billion** [5][10]. 6. **Market Sentiment**: Futures for SCFIS (Shanghai-Europe) are trading at a **30-51% discount** to spot rates, reflecting market expectations of weakening demand and overcapacity [3][25][29]. Additional Important Insights 1. **Impact of Labor Agreements**: The recent labor agreement averted a potential strike at US East Coast ports, which could have significantly disrupted shipping operations [20]. 2. **Tanker Market Conditions**: The tanker market is experiencing soft rates, with VLCC rates falling to approximately **USD 20,000 per day** due to weak demand and ongoing OPEC+ cuts [6]. 3. **Geopolitical Factors**: Sanctions on US-sanctioned tankers by Shandong Port Group may influence the inflow of Middle Eastern oil to China, potentially supporting VLCC rates [6]. 4. **Future Considerations**: Key factors to monitor include the extent of blanked sailings, cargo recovery post-CNY, and the timing of frontloading ahead of any punitive tariffs [23]. Conclusion The container shipping industry is currently facing challenges with declining freight rates and overcapacity, but there are signs of resilience in profitability among major shipping lines. The impact of labor agreements and geopolitical factors will be crucial in shaping the market dynamics in the near term.