March 12, 2025 08:00 AM GMT JD Health International Inc. | Asia Pacific Risk Reward Update What's Changed | JD Health International Inc. (6618.HK) | From | To | | --- | --- | --- | | Price Target | HK$22.00 | HK$25.00 | | Bull Case | HK$36.00 | HK$41.00 | | Base Case | HK$22.00 | HK$25.00 | | Bear Case | HK$16.00 | HK$18.00 | | Updated Components | | | | EPS | | | Risk Reward for JD Health International Inc. (6618.HK) has been updated Reason for change Interest income was also trimmed due to JDH's intention ...

March 12, 2025 03:35 PM GMT China – Clean Energy | Asia Pacific M Update Solar Products Price Tracker – Week 11, 2025 Polysilicon and wafer prices remained stable. Prices for domestic TOPCon cell and modules rose WoW. Solar films and EVA resin posted slight price increases, while POE resin prices stayed flat. Key Takeaways | 3/12/2025 Polysilicon (Rmb/kg) Wafer-182mm | | | Wafer-210mm | Cell-182mm | Cell-210mm | Polysilicon | Wafer-182mm | Cell-182mm | | --- | --- | --- | --- | --- | --- | --- | --- | --- | ...

ab 12 March 2025 Global Research Greentown China Holdings Upgrade to Buy on high exposure to core cities Regional SOE developers to outperform; upgrade to Buy We upgrade Greentown China to Buy on 1) better land bank vintage (newer), 2) high exposure to core cities, 3) active land acquisition. After four years of property downturns, there are growing signs of market stabilisation in tier-1 and core tier-2 cities. These include a recovery in existing property transactions in 2M25 with no policy easing, invent ...

Summary of Key Points from the Conference Call Industry and Company Overview - The analysis focuses on high-quality stocks in North America, specifically highlighting a selection of 30 companies deemed suitable for long-term investment until 2027 [1][2][3][4][5]. Core Insights and Arguments - **Quality Stocks Preference**: The report emphasizes that high-quality stocks are preferable amid elevated market uncertainty, with the Quality factor outperforming year-to-date [2][3]. - **Sustainability as a Criterion**: The main criterion for selecting stocks is sustainability, which includes competitive advantage, business model, pricing power, cost efficiency, and growth potential [4]. - **Analyst Contributions**: Analysts were tasked with identifying the highest-quality companies in their sectors, focusing on those likely to strengthen their competitive advantages [3][4]. - **Long-Term Performance**: The report supports the view that quality stocks tend to outperform in the long run, with a focus on companies that will differentiate themselves by 2027 [5]. Selected Companies - The report lists 30 companies identified as high-quality long-term picks, including: - Amazon.com - Apple - Microsoft - Visa - Coca-Cola - Meta Platforms - Walmart - And others [7]. Financial Metrics and Projections - **Revenue and EPS Growth**: The report provides projected revenue and EPS growth rates for selected companies, with Amazon expected to have a CAGR of 11% from 2022 to 2027, while Apple is projected at 4% [13]. - **Return on Net Operating Assets (RNOA)**: Companies like Amazon and Analog Devices are highlighted for their strong RNOA metrics, indicating efficient use of assets to generate profits [13][35]. - **Valuation Metrics**: The report includes valuation metrics such as P/E ratios and EV/EBIT for the selected companies, with Amazon at a P/E of 29.9x and Analog Devices at 29.1x [16]. Risk and Opportunities - **Market Positioning**: Companies are assessed on their ability to maintain or improve their market positions, particularly in a multipolar world [11]. - **ESG Factors**: Environmental, Social, and Governance (ESG) factors were integrated into the decision-making process, highlighting the importance of sustainable practices [4]. - **Potential Risks**: The report acknowledges potential risks associated with market volatility and policy changes but emphasizes the opportunities at the single-stock level [2][5]. Additional Insights - **Innovation and Growth**: Companies like Analog Devices are noted for their innovation and ability to engage with customers early in the design process, which is expected to drive future growth [36]. - **AI Opportunities**: Amazon's advancements in AI and logistics are highlighted as significant growth drivers, with expectations of capturing a larger market share in e-commerce [27]. Conclusion - The report concludes that the selected companies are well-positioned for long-term growth, with a focus on quality, sustainability, and innovation as key drivers of performance [5][36].

Summary of Conference Call on China Coal Power Utilities Industry Overview - The conference call focused on the **China Coal Power Utilities** sector, particularly the performance and outlook of Independent Power Producers (IPPs) amid declining power tariffs and coal prices [1][6]. Key Points and Arguments 1. Earnings Expectations and Market Positioning - Sharp declines in coal prices are raising earnings expectations for coal IPPs, with Huaneng Power (HNP) being better positioned due to more market coal and fewer tariff declines. However, China Resources Power (CRP) shows more upside potential due to healthy dividend yields [1][5]. 2. Power Tariff Declines - The de-rating of China IPP stocks since October 2024 was primarily due to concerns over annual declines in power tariffs. It is believed that these declines are now priced in, with limited uncertainty on tariffs for coal IPPs in 2025. CRP is expected to experience a year-over-year (YoY) decline in coal power tariffs of **3.3 cents**, while HNP is projected to see a decline of **2.4 cents** [2][22]. 3. Coal Price Impact - Recent sharp drops in spot coal prices to approximately **Rmb700/t** are expected to boost expectations for coal IPPs. If coal prices remain stable, coal IPPs could see fuel cost savings of **2-3 cents/kWh**, which may offset the negative impact of tariff declines [3][35]. 4. Concerns for New Energy Tariffs - There are ongoing concerns regarding power tariffs for new energy sources after full market participation. The introduction of a "mechanism tariff" aims to protect these tariffs, but the expectation is that new project volumes will accelerate tariff declines for new energy [4][68]. 5. Dividend Yield Analysis - The average yield for H-share coal power companies has risen to over **7%**, making the sector an attractive defensive yield play amid lower interest rates. HNP is expected to yield **7.4%**, while CRP is projected to maintain at least a **5%** yield in 2025, even with a decline in coal costs [5][12]. 6. Earnings Forecast Adjustments - Earnings forecasts for CR Power have been cut by **4-19%** for 2024-2026, while Huaneng's forecasts have seen minor adjustments of **0.5-2%**. This is attributed to CR Power's greater exposure to tariff declines and less fuel cost savings compared to Huaneng [10][11]. 7. Tariff Changes by Province - Significant tariff declines are noted in provinces such as Guangxi (down **10 cents**), Guangdong (down **7 cents**), Jiangsu (down **4 cents**), and Zhejiang (down **5 cents**). Other provinces generally saw declines of **1-2 cents** [19][20]. 8. Fuel Cost Dynamics - The percentage of long-term coal contracts is expected to decline slightly, allowing for more market pricing. Companies with fewer long-term contracts may benefit more from fuel cost declines. HNP is expected to see a unit fuel cost decline of **Rmb2.7 cents/kWh**, while CRP is estimated to have a slightly lower saving of **Rmb2.3 cents/kWh** [31][34]. 9. Operational Efficiency and Profitability - CRP has consistently ranked top in operational efficiency from 2019 to 2023. However, HNP's unit gross profit has been below peers since 2022, indicating varying profitability across companies [58][63]. 10. Renewable Energy Market Impact - The entry of renewable energy into market trading is expected to pressure market tariffs, with 100% participation anticipated in 2025. This could lead to accelerated tariff decline trends [69][70]. Additional Important Insights - The coal power sector is expected to account for over **70%** of power volume for listed power companies on average, despite the push for renewable energy [57]. - The sensitivity of dividend yields to coal prices indicates that HNP's yield could vary significantly based on coal price fluctuations, while CRP maintains a more stable yield [45][49]. This summary encapsulates the critical insights and projections discussed during the conference call, providing a comprehensive overview of the current state and future outlook of the China Coal Power Utilities sector.

Summary of Key Points from the Conference Call Industry Overview - **Industry**: China Technology, specifically the smartphone sector - **Current Trends**: Recent weakening momentum in smartphone demand following a strong initial response to national subsidies implemented on January 20, 2025 [1][3] Core Insights - **Subsidy Impact**: - Initial demand surge due to subsidies, but recent weeks show a decline in momentum - Discussions about a potential 10% subsidy for high-end models priced above Rmb6,000, though the impact is expected to be limited [1][3] - **2025 Demand Outlook**: - Anticipated year-over-year (yoy) unit growth of 3-5% in China, driven more by technical innovation and new model introductions rather than price discounts [1][3] - Supply chain checks indicate healthy inventory levels and stable shipment outlook for OEMs, with Huawei and Xiaomi expected to outperform with over 5% yoy unit growth [1][3] Company-Specific Insights - **Top Picks**: - Huaqin Technology and Luxshare are reiterated as top picks in the smartphone supply chain [1][3] - Huaqin is expected to benefit from AI infrastructure growth and strong performance in PC/smartphone segments [1][3] - Luxshare is noted for its high exposure to high-end iPhone models and robust growth in the auto/communication sectors [1][3] Financial Metrics - **Huaqin Technology**: - Current Price: Rmb83.40 - Market Cap: Rmb84,725 million - P/E (2025E): 22.0, P/E (2026E): 18.4 - ROE (2025E): 16%, ROE (2026E): 17% - Expected CAGR for earnings (2024-2026): 26% [8] - **Luxshare**: - Current Price: Rmb40.55 - Market Cap: Rmb293,023 million - P/E (2025E): 17.1, P/E (2026E): 13.5 - ROE (2025E): 23%, ROE (2026E): 24% - Expected CAGR for earnings (2024-2026): 27% [8] Additional Observations - **Market Sentiment**: - The overall sentiment in the smartphone market is cautious, with a focus on share gains and business expansion as key drivers for earnings growth [1][3] - **Supply Chain Dynamics**: - Positive shipment momentum observed in the initial weeks of subsidy implementation, but overall shipment targets for Android OEMs remain unchanged [1][3] This summary encapsulates the critical insights and data points from the conference call, providing a comprehensive overview of the current state and outlook of the smartphone industry in China, along with specific company analyses.

ASML Annual Report 2024 Summary Company Overview - **Company**: ASML - **Industry**: Semiconductors - **Market Cap**: €255 billion / US$276 billion - **12-month Rating**: Neutral - **12-month Price Target**: €740.00 - **Current Price (as of March 10, 2025)**: €639.00 Key Financial Metrics - **2024 Revenues**: €28.263 billion, up from €27.559 billion in 2023 [6] - **2024 EBIT**: €9.063 billion, slightly down from €9.082 billion in 2023 [6] - **2024 Net Earnings**: €7.395 billion, down from €7.681 billion in 2023 [6] - **2024 EPS**: €18.79, down from €19.49 in 2023 [8] - **2024 R&D Expenditure**: €4.3 billion, up from €4 billion in 2023 [5] - **2024 Dividend per Share**: €6.40, up from €6.10 in 2023 [6] Performance Obligations - **2024 Performance Obligations**: €43 billion, down from €45 billion in 2023 [2] - **Percentage of Revenue Recognized in Next 12 Months**: 59%, covering 79% of 2025 guidance [2][18] - **Decline in Coverage of Year-Ahead Guidance**: From below 93% in 2023 to 79% in 2024 [2][19] Revenue Growth and Market Dynamics - **China Revenue**: Increased to 36% of group revenues in 2024 from 26% in 2023, with a 48% year-over-year growth in service revenue [3][12] - **Product Sales in China**: Rose to €9 billion in 2024 from €6.4 billion in 2023 [12] - **Service Revenue in China**: Increased to €1.2 billion in 2024 from €0.8 billion in 2023 [12] Inventory and Supply Chain - **Inventory Levels**: Increased to €10.9 billion in 2024 from €8.9 billion in 2023, with inventory days rising from 251 to 289 [4][44] - **Hiring Trends**: Slowed down with 2,400 new payroll employees in 2024, down from higher growth rates in previous years [28] R&D and Innovation - **R&D Employees**: Increased to 16,000 in 2024 from 15,600 in 2023 [5] - **R&D Spend per Employee**: Increased from €255,000 in 2023 to €269,000 in 2024 [5] - **Patents Held**: Grew by approximately 2% year-over-year to over 17,400 [25] Energy Efficiency and ESG Metrics - **EUV Systems Energy Consumption**: Reduced by approximately 50% per wafer pass since 2018, with plans for further reductions by 2027 [46] - **ESG Considerations**: Improvements in energy efficiency are expected to enhance cost of ownership and support EUV adoption [46] Geopolitical and Regulatory Environment - **Export Control Restrictions**: Increased list of Chinese entities impacted by export controls, affecting sales and operations [16][17] - **Compliance Commitment**: ASML remains committed to adhering to all applicable laws and regulations regarding exports [16] Market Outlook - **Semiconductor Market Forecast**: Expected to reach $679 billion in 2025, down from previous estimates of $721 billion [10] - **Long-term Growth**: Projected to reach $1,051 billion by 2030 [10] Conclusion - ASML continues to demonstrate strong operational quality and financial performance despite short-term challenges and geopolitical risks. The company's focus on R&D and energy efficiency positions it well for future growth in the semiconductor industry.

Summary of Key Points from the Conference Call Industry Overview - The focus is on the **European Energy** sector, particularly regarding the transition to decarbonization and the implications for various industries including **Utilities**, **Metals & Mining**, **Chemicals**, and **Autos** [2][4][5][13]. Core Insights and Arguments 1. **Shift in Capital Allocation**: European corporates are increasingly prioritizing cash flow and returns over green capital expenditures (capex), leading to a reduction in investments aimed at decarbonization [2][4][14]. 2. **Regulatory Simplification**: The European Commission is implementing measures such as the **Omnibus package** and the **Clean Industrial Deal** to ease regulatory burdens and improve competitiveness, which are expected to save €6.3 billion in administrative costs [3][15][41]. 3. **Softening Climate Commitments**: There is a notable trend of companies scaling back their climate commitments, with significant reductions in green capex across sectors, particularly in **European Energy** [4][40][67]. 4. **Investment Preferences**: The report favors investments in electricity networks over renewables within the Utilities sector, highlighting companies like **National Grid**, **E.ON**, **Iberdrola**, and **SSE** as top picks [5][25]. 5. **Changing Dynamics in Autos**: The European Autos team has reduced battery electric vehicle (BEV) penetration forecasts by approximately 200 basis points due to high prices and insufficient charging infrastructure [19][57]. Additional Important Insights 1. **Defence Spending Impact**: EU countries are reallocating fiscal resources towards defense spending, which is affecting the pace of the energy transition [2][3]. 2. **Investment Grade Credit Trends**: The supply of EUR investment-grade bonds with ESG labels has slowed, indicating a potential shift in investor sentiment towards green investments [21][67]. 3. **Climate Capex Cuts**: The reduction in climate capex is not a complete withdrawal but a strategic refocusing towards lower-risk, higher-return projects [66][67]. 4. **Future of Energy Theme**: The intersection of energy security and the energy transition is becoming increasingly significant, with a shift back towards conventional oil and gas projects [16][70]. 5. **Emerging Technologies**: Technologies such as **Earthshots**, **AI**, and **robotics** are expected to play a crucial role in driving decarbonization efforts [23][68]. Conclusion The conference call highlights a complex landscape for the European energy sector, characterized by a shift in investment priorities, regulatory changes aimed at enhancing competitiveness, and a softening of climate commitments. The implications of these trends are significant for various industries, particularly in terms of capital allocation and future growth strategies.

Summary of Global FX Strategy Conference Call Industry Overview - The report focuses on the foreign exchange (FX) market, particularly the dynamics affecting major currency pairs such as EURUSD, USDJPY, and others, in light of recent geopolitical and economic developments. Key Points and Arguments Currency Forecast Adjustments - **EURUSD Forecasts**: - Upgraded end-2025 forecast to 1.12 and end-2026 forecast to 1.14, reflecting a more bullish outlook compared to previous estimates of 0.990 and 1.000 respectively [2][10] - Short-term retracement expected due to potential US reciprocal tariffs against the EU [2][9] - **USDJPY Forecasts**: - Lowered end-2025 target from 150 to 140 and end-2026 target from 145 to 130, aligning closer to long-term model fair value of 126 [20][25] - **EURCHF Forecasts**: - Revised upward to 0.9700 by end-2025 and 1.0000 by end-2026, indicating a shift in sentiment towards the euro area [24][25] - **Commodity Currencies**: - Increased forecasts for commodity currencies like NOK and SEK due to USD weakness, with projections of EURSEK at 10.60 and EURNOK at 11.30 by end-2025 [4][27] Geopolitical and Economic Influences - **US Developments**: - Factors such as DOGE and President Trump's tariff focus have negatively impacted US growth exceptionalism, leading to a reassessment of USD strength [10][8] - Concerns over potential US tariffs against the EU could create short-term volatility in the EUR [9][10] - **German Fiscal Stimulus**: - A significant constitutional fiscal easing in Germany is expected to tighten ECB policy in the medium term, supporting a stronger EUR [10][8] Market Sentiment and Positioning - **Market Reactions**: - The market has shifted from a negative outlook on Europe to a more optimistic view due to anticipated infrastructure and defense spending [10][11] - Risk reversals indicate that the positive shock factor for EURUSD is already priced in, suggesting limited room for further gains in the near term [12][18] Trade Recommendations - **New Trades**: - Suggested to buy a 3-month EURUSD 1.0800 call with a knock-in at 1.0630, capitalizing on current market conditions [17][18] - Recommended a basket trade of long EUR and JPY against short CHF and GBP to capture structural changes in fiscal and monetary policies [23][25] Risks and Considerations - **Short-term Risks**: - The potential for a US-Canada trade war and its implications for CAD and overall market sentiment remain a concern [34][35] - The impact of geopolitical tensions and tariff negotiations could lead to increased volatility in the FX market [48] Other Important Content - **Long-term Outlook**: - The report emphasizes a return to pre-election forecasts, suggesting that the market is adjusting to new realities in US and European fiscal policies [8][10] - **Valuation Method and Risk Statement**: - Acknowledges risks associated with multi-asset investing, including market, credit, and foreign exchange risks, highlighting the importance of monitoring geopolitical events [48]

Summary of Key Points from the Conference Call Industry and Company Overview - The report focuses on the **quantitative equity research** sector, particularly on **index tracking funds** and their performance dynamics across major markets including the **US**, **Europe**, and **Japan** [2][14][69]. Core Insights and Arguments 1. **Tracking Errors and Trading Costs**: Minimizing tracking errors in index funds can lead to increased trading costs, as funds may buy high and sell low during index reconstitution [2][15][69]. 2. **Alpha Opportunities**: The report identifies alpha opportunities arising from the mechanical operations of index tracking funds, which have gained popularity due to low expense ratios and diversification [14][69]. 3. **Performance Trends**: - **US Market**: Stocks added to the S&P 500 tend to be most expensive 1-2 months prior to their effective inclusion, while deleted stocks trade at their lowest valuation one month post-deletion [69]. - **European Market**: Similar trends are observed in the STOXX 600, with added stocks showing outperformance before effectiveness and underperformance afterward [26][69]. - **Japanese Market**: The TOPIX 500 exhibits a pattern where added stocks outperform slightly before inclusion but underperform significantly afterward [26][69]. 4. **Factor Rankings**: - In **Europe**, the 10Y regime was revised from 'falling' to 'flat', with **Management Quality** ranked highest and **Profitability** the weakest [4][73]. - In the **US**, **Size** has emerged as the highest-ranked factor, overtaking **Management Quality**, while **Composite Value** improved from 13th to 9th place [5][76]. - In **Japan**, **Composite Value** has overtaken **Defensive Value** as the most favored factor [6][76]. Additional Important Insights 1. **Momentum Analysis**: Stocks added to indices typically show strong momentum leading up to their addition, while those removed exhibit weak momentum [41][48]. 2. **Reconstitution Timing**: Implementing index changes immediately after announcements rather than waiting for effective dates tends to enhance index performance [63][71]. 3. **Valuation Trends**: The report highlights that added stocks are generally most expensive before their addition, while deleted stocks are at their lowest valuation shortly after removal [69][71]. 4. **Quality and Growth Exposures**: Stocks added to indices show stronger growth exposures compared to those removed, particularly in the US and Europe [58][59]. Conclusion - The report emphasizes the importance of understanding the dynamics of index reconstitution and the associated trading behaviors, which can provide significant investment insights and opportunities for alpha generation [69][71].