Summary of Kingboard Laminates Holdings (1888.HK) Conference Call Company Overview - **Company**: Kingboard Laminates Holdings (1888.HK) - **Date of Report**: 28 February 2025 Key Points Financial Performance - Kingboard Laminates Holdings (KBL) announced a positive profit alert for 2024, estimating a net profit increase of over 43% year-on-year to more than HK$1.3 billion, which is below the forecast of HK$1.648 billion [1][3] - The discrepancy in profit expectations is attributed to: 1. One-off provision on re-valuation of property investment portfolio and property bonds due to a subdued property market 2. Lower-than-expected gross margin (GM) in 4Q24 due to increased bulk purchase discounts across the industry [1][3] Market Reaction - Following the profit alert, KBL's stock declined by 6%, although it had previously gained over 25% in the week leading up to the announcement [1] - The current stock price is HK$9.22, with a target price set at HK$11.50, indicating an expected share price return of 24.7% and a total expected return of 28.3% [4] Industry Context - The lower GM in 4Q24 is viewed as an industry-wide issue rather than company-specific, as KBL's competitor, Shengyi Technology, also reported a profit alert that missed expectations [3] - KBL's GM is projected to improve from approximately 19% in 2024 to around 23% in 2025, still below the mid-cycle average of 25% [3] Shipment Trends - Monthly shipments showed a persistent uptick in the second half of 2024 compared to the first half, with an average monthly shipment increase of 12.1% [6] Valuation and Risks - The target price of HK$11.50 is based on a price-to-earnings (P/E) ratio of approximately 15x for 2025, reflecting a cautious approach due to slower-than-expected macro consumption in China [8] - Key risks affecting the stock's performance include: 1. Variability in China's macroeconomic growth 2. Changes in government stimulus measures 3. Fluctuations in demand for electronic goods [9] Conclusion - Despite the short-term stock weakness, the overall outlook for KBL remains positive, with expectations of a margin upcycle continuing into 2025, presenting potential buying opportunities for investors [1][3]

28 February 2025 Global bond flows compass Fixed Income Favouring Asia local debt Global Chart of the week: Weak demand for NTN-F in January -6000 -4000 -2000 0 2000 4000 6000 8000 Jan-24 Feb-24 Mar-24 Apr-24 May-24 Jun-24 Jul-24 Aug-24 Sep-24 Oct-24 Nov-24 Dec-24 Jan-25 Foreign flows (USDm) LFT LTN NTN-F Source: Brazil government website, Bloomberg, HSBC Figure 1. Monthly trends in offshore bond flows of EM sovereign debt Note: *For period, see Table 1. Source: Central bank websites, HSBC Soumya Mohanty, C ...

In the week to 26 February, EM bond funds had inflows, while outflows from EM equity funds continued. EM hard-currency bond funds had moderate inflows for a second consecutive week, driven by flows into non-ETF/actively managed funds. Overall flows for EM bond funds were also positive as a result, given the broadly flat flows for EM local-currency bond funds. Meanwhile, outflows from EM equity funds continued, driven by Asia-focused funds. In the EM Weekly: Dealing with uncertainty, 28 February 2025, we hig ...

Summary of the Conference Call on Hong Kong and Mainland China Real Estate Industry Overview - **Industry**: Real Estate in Hong Kong and Mainland China - **Date**: 28 February 2025 Key Points and Arguments Hong Kong Real Estate 1. **New World Development**: Released a new price list for 41 units in State Pavilia, priced between HKD 7.8 million to HKD 14.3 million per unit, translating to HKD 21,807 to HKD 32,333 per square foot after discount [5] 2. **Centa-Valuation Index (CVI)**: Declined by 4.37 percentage points week-over-week to 36.89 points, indicating potential downward pressure on property prices if it does not recover above 40 points [6] 3. **Coasto Project**: Wang On Properties reported 1,100 indications of interest for 60 units, resulting in a 17x oversubscription, with unit prices ranging from HKD 3.8 million to HKD 7.2 million [7] 4. **Sun Hung Kai Properties**: Noted signs of business improvement in the first half of the year, including faster property sales and landbank replenishment, suggesting the end of the earnings decline cycle [4] Mainland China Real Estate 1. **Land Sales in Shanghai**: The city plans to sell 13 sites with a total reserve price of RMB 11.3 billion, with significant sites in Minhang and Qingpu districts [8] 2. **CR Land Acquisition**: Acquired a plot in Beijing's Shunyi District for RMB 6 billion, with a plot ratio of 1.0 and an average value of approximately RMB 35,000 per square meter [9] 3. **Logan Group**: Over 80.8% of offshore creditors approved a debt restructuring plan, indicating progress in financial recovery [10] Market Valuation and Performance 1. **Valuation Summary**: Various Hong Kong property developers have target prices significantly above current market prices, indicating potential upside. For example, CK Asset has a target price of HKD 44.60 compared to a current price of HKD 33.90 [12] 2. **Share Price Performance**: The report includes a detailed performance analysis of various companies, showing a mixed performance over different time frames, with some companies like New World Development experiencing significant declines [21] Additional Insights 1. **Rental Pipelines**: Solid rental pipelines are expected to provide visibility on dividend outlooks for companies like Sun Hung Kai Properties [4] 2. **Market Trends**: The report highlights a cumulative decline in the CVI over the past three weeks, suggesting a cautious outlook for property prices in the near term [6] Conclusion The conference call provided a comprehensive overview of the current state of the real estate market in Hong Kong and Mainland China, highlighting both challenges and opportunities. Key players are showing signs of recovery, but market indicators suggest caution moving forward.

February 28, 2025 03:10 PM GMT China Materials | Asia Pacific Weekly Monitor: Demand Seasonally Recovers Rebar consumption has improved for two weeks in a row. Base metals: Shanghai copper prices were down 0.8% WoW, while inventories decreased 0.4% WoW. Shanghai aluminum prices were down 1.1% WoW, while inventories were down 5.5% WoW. Key news of the week: Reuters – Trump orders new tariff probe into US copper imports under Section 232. Battery metals: Domestic industrial-grade lithium hydroxide and battery ...

J P M O R G A N North America Equity Research 28 February 2025 Duolingo Max & AI Product Cycle Supports Potential 2025 Bookings Growth Upside; Modeling 2H DAU Growth Re-Accel; Adj. EBITDA Margin Pick-Up in 2H; Reiterate OW & $410 ▲Price Target (Dec-25):$410.00 Prior (Dec-25):$400.00 DUOL shares traded down -7% post-close as the 2025 Bookings & Adj. EBITDA guide were modestly below high investor expectations. However, we're encouraged by DUOL's AI product cycle led by Max, which comprises ~5% of paid subscri ...

February 28, 2025 10:51 AM GMT China Materials | Asia Pacific Demand Tracker – February 28 Per 100NJZ, the work resumption rate of sampled construction projects was 64.6% in the fourth week after the holiday, 10.8% lower YoY. Production/Sales of industrial goods: Per CISA, in mid-Feb, average daily output of major steel mills was 2.151mnt, up 0.8% vs. early-Feb. Hubei Huangshi promotes off- peak cement production, and urged production based on approved capacity. Fubao reported that weekly production of lith ...

Summary of Key Points from the Conference Call Industry Overview - The conference call focused on the Chinese economy and market outlook, particularly in the context of the upcoming "Two Sessions" in March 2025. Onshore clients from major cities such as Beijing, Shanghai, Guangzhou, and Shenzhen were consulted, including mutual funds, private equity funds, and asset managers from banks and insurance companies [1][2]. Core Insights 1. **Improved Sentiment on China’s Macro Outlook** Onshore clients have become slightly more optimistic about China's macroeconomic and market outlook due to recent developments in AI and the property sector, including home sales and prices in large cities [2][6]. 2. **Concerns About US Growth** There is heightened concern among clients regarding the US growth outlook, particularly due to the implications of Trump’s tariff and immigration policies, as well as issues surrounding US debt sustainability [7][9]. 3. **Low Expectations for "Two Sessions"** Onshore clients expressed low expectations for significant announcements during the upcoming "Two Sessions," particularly regarding fiscal measures and government bond issuance quotas [8][11]. 4. **Uncertainties in US-China Relations** The recent signing of the National Security Presidential Memorandum and the announcement of additional tariffs on Chinese goods have contributed to uncertainties in US-China relations, with clients expecting a more restrained response from China compared to previous years [9][12]. 5. **Monetary Policy Outlook** Clients believe that China's monetary policy has effectively tightened since the beginning of the year, despite a shift in the PBOC's stance to "moderately loose." There is a consensus that further liquidity injections will be necessary [13]. 6. **PPI Deflation Concerns** Onshore clients have lower expectations for PPI inflation, with many anticipating it may not turn positive until 2026 or later, citing overcapacity issues and the prolonged downturn in the property sector [14]. 7. **Differences Between Onshore and Offshore Perspectives** There are notable differences in how onshore and offshore investors view the Chinese economy, with onshore investors focusing more on PPI deflation and industrial policy, while offshore investors are more concerned with signals from the "Two Sessions" [15]. Additional Important Points - **Property Sector Recovery** Clients noted some recovery in the property sector, particularly in large cities, but acknowledged that lower-tier cities may continue to face challenges [6][7]. - **Government Bond Issuance Expectations** Market expectations for total government bond net issuance are in the range of RMB12-13 trillion, with some clients flagging risks of a smaller issuance quota than previously expected [11]. - **AI Investment Incentives** Local governments and corporates are increasingly incentivized to boost AI-related investments, reflecting a recovery in economic "animal spirits" [6]. - **RMB Exchange Rate Stability** Clients do not expect significant depreciation of the RMB against the USD, contrasting with sentiments from late last year [13]. This summary encapsulates the key insights and concerns raised during the conference call, providing a comprehensive overview of the current sentiment among onshore clients regarding the Chinese economy and its interaction with global factors.

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the retail sales performance in China, highlighting the divergent trends across different city tiers [2][3]. Core Insights 1. **Weak Consumption as a Structural Issue** - Weak consumption is identified as a major structural problem in China, contributing to a supply-demand imbalance and prolonged deflation pressure. From 2022 to 2024, consumption contributed an average of 2.8 percentage points to GDP growth per annum, significantly lower than the 4.2 percentage points from 2016 to 2019 [3][12]. 2. **Retail Sales Growth Disparity** - Cumulative retail sales growth from 2022 to 2024 was only 3.5% in tier-1 cities, compared to 8.6% in tier-2 cities and 11.2% in lower-tier cities [4][5]. This indicates a significant divergence in retail performance across city tiers. 3. **City-Level Performance Variability** - Among 168 cities analyzed, 8 cities reported over 20% cumulative growth, while 5 cities experienced a contraction. Notably, Beijing and Shanghai reported declines of -5.4% and -0.8%, respectively [6][8]. 4. **Household Income as a Key Driver** - A strong positive correlation exists between household income growth and retail sales growth, with an R-squared value of 0.32. This suggests that household income is a critical factor influencing consumption [9][12]. 5. **Policy Implications for Consumption Boost** - The report discusses the need for policies that boost household income and consumption. Direct fiscal transfers, such as cash handouts or consumption vouchers, are seen as temporary solutions. A more sustainable approach would involve broadening employment and income bases, particularly in the service sector [12][28]. 6. **Housing Market Dynamics** - The housing market's impact on consumption is multifaceted, involving both wealth effects and debt service burdens. The report notes that the decline in home prices has negatively affected consumption, particularly in tier-1 cities where home prices remain high relative to income [14][29]. 7. **Debt Service Burden and Affordability** - The average home price to income ratio was 17.0 in tier-1 cities, compared to 8.6 in tier-2 and 6.9 in tier-3 cities. High ratios in tier-1 cities correlate with weaker retail sales growth due to increased mortgage burdens [23][24]. 8. **Government Actions and Local Discretion** - Recent government actions to support consumption, such as trade-in subsidies, are noted. However, the effectiveness of these measures may vary across cities, necessitating local discretion to maximize impact [30][27]. Additional Important Insights - The report emphasizes the importance of addressing the social safety net and public services to reshape household expectations and reduce precautionary savings [13][28]. - The ongoing debate regarding effective policy measures to stimulate consumption highlights the complexity of the economic landscape in China [12][27]. This summary encapsulates the key findings and insights from the conference call, providing a comprehensive overview of the current state of retail sales in China and the factors influencing consumption trends.

Summary of Conference Call on China Property Market Industry Overview - The conference call focused on the **China Property** market, specifically the performance of major developers in February 2025, as tracked by **CRIC** [1][2]. Key Points Sales Performance - **Contracted sales** of 30 major developers dropped **16% year-on-year (y-y)** in February 2025, following a low base [1]. - The **top 50 and top 100 developers** saw attributable sales growth of **3% and 2% y-y**, respectively, compared to declines of **-4% and -1% in January** [2]. - Year-to-date (YTD) sales decline for the top developers narrowed to **-1% and 0% y-y** in the first two months of 2025, contrasting with **+5% and +2% in Q4 2024** [2]. Divergence in Performance - **State-Owned Enterprises (SOEs)** outperformed others, with notable growth from **Yuexiu (+63%)**, **COLI (+55%)**, **CR Land (+47%)**, and **C&D (+36%)** y-y [3]. - Conversely, some developers like **Zhongliang**, **Zhongnan**, and **Seazen** experienced declines exceeding **50% y-y** [3]. - Semi-SOE developers such as **Gemdale** and **Vanke** also reported weak performance, with declines of **-45% and -27% y-y**, respectively [3]. Future Outlook - Sales for major developers are expected to weaken y-y in the coming months due to reduced saleable resources and a higher base [4]. - The housing policy response is anticipated to remain reactive, with limited demand-side stimulus until housing prices stabilize [4]. - There is a need for faster policy implementation, particularly regarding funding and inventory buybacks, to bolster homebuyer confidence [4]. Investment Recommendations - The industry performance may hinge on sustained sales and home price recovery, with mixed signals observed in the physical market [5]. - The recommendation is to focus on **defensive SOE players** with substantial saleable resources in tier 1 cities, such as **CR Land (1109.HK)**, **Greentown (3900.HK)**, and **Yuexiu (0123.HK)** [5]. Additional Insights - The **fragility of residential sentiment** is highlighted, as reflected in declining secondary listing prices [5]. - The **aggregate sales** for the top developers showed a **-1% y-y** change, with a **-5% month-on-month (m-m)** decline in February 2025 [9]. Conclusion - The China Property market is facing challenges with declining sales and a reactive policy environment. However, SOEs are showing resilience, and strategic investments in top-tier developers may present opportunities amidst the volatility.