Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

Equity Bottom-Up

<ul>
<li>Parcel volume growth remained strong in June, but ASPs weakened (again)</li>
<li>YTO Express seems to be managing price / volume tradeoff competently</li>
<li>Year-To-Date, only YTO shares up &gt; 10%; three companies down -10% or more </li>
</ul>


Parcel volume growth remained strong in June, but ASPs weakened (again)
YTO Express seems to be managing price / volume tradeoff competently
Year-To-Date, only YTO shares up &gt; 10%; three companies down -10% or more 


Monthly Chinese Express Tracker | Strong June Volume | Weak Pricing and Intl | (July 2024)

<ul>
<li>Industry and company reports show ASP declines gained momentum in April</li>
<li>April volume jumped 36% Y/Y on a weak comp from 2022 (Covid-19 lockdowns)</li>
<li>Our thesis: pricing is getting weaker, and this trend will soon impact margins</li>
</ul>


Industry and company reports show ASP declines gained momentum in April
April volume jumped 36% Y/Y on a weak comp from 2022 (Covid-19 lockdowns)
Our thesis: pricing is getting weaker, and this trend will soon impact margins


Monthly Express Tracker | Prices Continue to Slide | Volume Pops | (May 2023)

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/weride-corp" target="_blank" data-smartkarma-citation="entities:39905:1" rel="noopener">WeRide (WRD US)</a>, a provider of autonomous driving products and services, seeks to raise between US$200 to US$300 million through a Nasdaq IPO.    </li>
<li>WeRide is the most commercially successful L4 autonomous driving company globally, measured by commercialization revenue in 2021, 2022 and 2023.</li>
<li>The bull case rests on a large TAM, strong product capabilities, near-term mass commercialization, articulation of a path to profitability, improving earnings quality and presence of blue-chip investors. </li>
</ul>



WeRide (WRD US), a provider of autonomous driving products and services, seeks to raise between US$200 to US$300 million through a Nasdaq IPO.    
WeRide is the most commercially successful L4 autonomous driving company globally, measured by commercialization revenue in 2021, 2022 and 2023.
The bull case rests on a large TAM, strong product capabilities, near-term mass commercialization, articulation of a path to profitability, improving earnings quality and presence of blue-chip investors. 


Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

<ul>
<li>ZTO reported C4Q23 top-line, GAAP EBIT, and non-GAAP net income (2.2%), (3.8%), and in-line vs. cons., respectively;</li>
<li>There are two concurrent trends in the last-mile market: (1) improved service quality, and (2) smaller parcel sizes. Both are favorable to ZTO, in our view;</li>
<li>ZTO announced new shareholder return plans, which we estimate could return US$ 1.4bn to investors in 2024 for a 7.7% yield;</li>
</ul>


ZTO reported C4Q23 top-line, GAAP EBIT, and non-GAAP net income (2.2%), (3.8%), and in-line vs. cons., respectively;
There are two concurrent trends in the last-mile market: (1) improved service quality, and (2) smaller parcel sizes. Both are favorable to ZTO, in our view;
ZTO announced new shareholder return plans, which we estimate could return US$ 1.4bn to investors in 2024 for a 7.7% yield;


[ZTO Express (ZTO US, BUY, TP US$24) Target Price Change]: Two Trends, Both Are Favorable to ZTO

<ul>
<li>In Q423, ZTO's parcel volumes grew by +32% Y/Y, faster than market growth</li>
<li>But weak pricing resulted in EPS growth of just +2% Y/Y in the period</li>
<li>In FY24, management expects parcel growth to roughly halve - AVOID</li>
</ul>


In Q423, ZTO's parcel volumes grew by +32% Y/Y, faster than market growth
But weak pricing resulted in EPS growth of just +2% Y/Y in the period
In FY24, management expects parcel growth to roughly halve - AVOID


ZTO Express Q423 Results & Guidance in One Simple Table | +32% Volume --> +2% EPS?! | AVOID

China

ZTO Express (Cayman) Inc. operates as an express delivery company. The Company provides express delivery service through their nationwide network, as well as other value-added logistics services. ZTO Express serves customers globally.

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ZTO Express Cayman (ZTO US)

Monthly Chinese Express Tracker | Strong June Volume | Weak Pricing and Intl | (July 2024)

In June, China's express delivery sector again reported strong volume growth, but weak unit pricing. Share performance reflects this dynamic, with...

Tracking Traffic

Monthly Express Tracker | Prices Continue to Slide | Volume Pops | (May 2023)

In April, express volume shot up 36% against easy Y/Y comps, but ASPs deepened their recent decline. We believe pricing will continue to...

Tracking Traffic

WeRide (WRD US) IPO: The Bull Case

The bull case rests on a large TAM, strong capabilities, near-term mass commercialization, articulation of a path to profitability, improving...

Arun George

[ZTO Express (ZTO US, BUY, TP US$24) Target Price Change]: Two Trends, Both Are Favorable to ZTO

ZTO's strong financials, favorable market trends, and new shareholder return plans position the company for continued growth and investor returns.

Blue Lotus Research Institute

ZTO Express Q423 Results & Guidance in One Simple Table | +32% Volume --> +2% EPS?! | AVOID

ZTO managed to convert +32% volume growth in Q423 into just +2% EPS growth. Looking at 2024, management expects volume growth to slow dramatically.

Tracking Traffic

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52-week Range

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Monthly Chinese Express Tracker | Strong June Volume | Weak Pricing and Intl | (July 2024)

In June, China's express delivery sector again reported strong volume growth, but weak unit pricing. Share performance reflects this dynamic, with...

Tracking Traffic

Monthly Express Tracker | Prices Continue to Slide | Volume Pops | (May 2023)

In April, express volume shot up 36% against easy Y/Y comps, but ASPs deepened their recent decline. We believe pricing will continue to...

Tracking Traffic

WeRide (WRD US) IPO: The Bull Case

The bull case rests on a large TAM, strong capabilities, near-term mass commercialization, articulation of a path to profitability, improving...

Arun George

[ZTO Express (ZTO US, BUY, TP US$24) Target Price Change]: Two Trends, Both Are Favorable to ZTO

​ZTO's strong financials, favorable market trends, and new shareholder return plans position the company for continued growth and investor returns.

Blue Lotus Research Institute

ZTO Express Q423 Results & Guidance in One Simple Table | +32% Volume --> +2% EPS?! | AVOID

ZTO managed to convert +32% volume growth in Q423 into just +2% EPS growth. Looking at 2024, management expects volume growth to slow dramatically.

Tracking Traffic

ZTO's strong financials, favorable market trends, and new shareholder return plans position the company for continued growth and investor returns.