External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Thematic (Sector/Industry)

<ul><li>Based on NBS data, 2M24 online retail sales GMV/online physical goods GMV reached RMB2.2tn/1.8tn, up 15.3/14.4% YoY, which implied a two-year CAGR of 10.7/9.8%.</li><li>The growth of total online retail sales GMV continued to outpace that of online physical goods GMV, which was likely due to the robust growth in online travel bookings during the CNY holiday.</li><li>Leading e-commerce platforms are prioritizing GMV and revenue growth over margin improvement in 2024, and guided to reinvest incremental operating profit generated to drive further business growth, which likely indicates more intensified industry competition. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Based on NBS data, 2M24 online retail sales GMV/online physical goods GMV reached RMB2.2tn/1.8tn, up 15.3/14.4% YoY, which implied a two-year CAGR of 10.7/9.8%.The growth of total online retail sales GMV continued to outpace that of online physical goods GMV, which was likely due to the robust growth in online travel bookings during the CNY holiday.Leading e-commerce platforms are prioritizing GMV and revenue growth over margin improvement in 2024, and guided to reinvest incremental operating profit generated to drive further business growth, which likely indicates more intensified industry competition. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Internet - 2M24 online retail sales recap

Credit

<ul><li>Credit stories remain sound: Chinese TMT issuers are generally cash-rich with solid liquidity profiles. Most of them are in net cash positions and have strong coverage ratios at their rating levels. See Table 6 on p.7.</li><li>Shorter-dated XIAOMIs remain our top picks: We like Xiaomi for its solid credit story.</li><li>The sizeable net cash position and operating cash inflow offset the impact of higher R&amp;D expenses, especially those on EV. XIAOMI 3 3/8 04/29/30 (Baa2/BBB-/BBB) and XIAOMI 2 7/8 07/14/31 (Baa2/BBB-/BBB) offer 121bps yield pick-up over JD 3 3/8’30 (Baa1/A-/-) and 12bps over MEITUA 3.05’30 (Baa3/BBB-/BBB-).</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Credit stories remain sound: Chinese TMT issuers are generally cash-rich with solid liquidity profiles. Most of them are in net cash positions and have strong coverage ratios at their rating levels. See Table 6 on p.7.Shorter-dated XIAOMIs remain our top picks: We like Xiaomi for its solid credit story.The sizeable net cash position and operating cash inflow offset the impact of higher R&amp;D expenses, especially those on EV. XIAOMI 3 3/8 04/29/30 (Baa2/BBB-/BBB) and XIAOMI 2 7/8 07/14/31 (Baa2/BBB-/BBB) offer 121bps yield pick-up over JD 3 3/8’30 (Baa1/A-/-) and 12bps over MEITUA 3.05’30 (Baa3/BBB-/BBB-).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China TMT: Maintain Buy XIAOMI’30-31s, XIAOMI 0’27 (CB)

Equity Bottom-Up

<ul><li>Weibo announced 1Q23 financial results on 25 May.</li><li>Total revenue dropped by 15% YoY (or -7% YoY on a constant currency basis) to US$414mn in 1Q23, inline with the consensus estimate.</li><li>1Q23 non-GAAP net income was down by 16% YoY to US$111mn, better than consensus estimate of US$103mn. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Weibo announced 1Q23 financial results on 25 May.Total revenue dropped by 15% YoY (or -7% YoY on a constant currency basis) to US$414mn in 1Q23, inline with the consensus estimate.1Q23 non-GAAP net income was down by 16% YoY to US$111mn, better than consensus estimate of US$103mn. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Weibo (WB US) – Solid Margin and Attractive Valuation; Wait for Top-Line Recovery

<ul><li>Weibo reported 4Q22 financial results on 1 Mar. 4Q22 total revenue declined by 27% YoY (-20% YoY on a constant currency basis) to US$448mn, in line with our and consensus estimate.</li><li>FY22 total revenue was down by 19% YoY to US$1.8bn, mainly due to macro headwind and COVID-19 impact.</li><li>4Q22 nonGAAP net income dropped by 9% YoY to US$179mn, beating the consensus estimate of US$122mn, primarily due to effective expense control and reversal of US$58.8mn compensation expenses. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Weibo reported 4Q22 financial results on 1 Mar. 4Q22 total revenue declined by 27% YoY (-20% YoY on a constant currency basis) to US$448mn, in line with our and consensus estimate.FY22 total revenue was down by 19% YoY to US$1.8bn, mainly due to macro headwind and COVID-19 impact.4Q22 nonGAAP net income dropped by 9% YoY to US$179mn, beating the consensus estimate of US$122mn, primarily due to effective expense control and reversal of US$58.8mn compensation expenses. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Weibo (WB US) – Gradual revenue and margin recovery in FY23

<ul><li>Weibo faced pressure in 4Q22E due to tighter regulations on entertainment content and extreme disruptions on ads promotions from resurgence of COVID in Dec 2022.</li><li>Hence, we lower FY22/4Q22E total revenue forecast by 1/4%. Market now looks ahead to recovery potential in online ads demand, driven by China’s reopening and consumption recovery.</li><li>The speed of economic activities recovery post Chinese New Year is ahead of our previous expectation, which should support Weibo’s revenue recovery in FY23E. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Weibo faced pressure in 4Q22E due to tighter regulations on entertainment content and extreme disruptions on ads promotions from resurgence of COVID in Dec 2022.Hence, we lower FY22/4Q22E total revenue forecast by 1/4%. Market now looks ahead to recovery potential in online ads demand, driven by China’s reopening and consumption recovery.The speed of economic activities recovery post Chinese New Year is ahead of our previous expectation, which should support Weibo’s revenue recovery in FY23E. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Weibo (WB US) – Recovery on the horizon despite ST pressure

China

JOYY Inc. operates a global social media platform. The Company offers platform which enables users to interact with each other in real time through online live media by creating, sharing, and enjoying a vast range of entertainment content and activities. JOYY serves customers in China.

Beijing TRS Information Technology Company Limited develops and markets software and technology services for unstructured data management. The Company provides software products that are enterprise search, content management and text mining.

Focus Technology Co Ltd. provides business-to-business (B2B) e-commerce solutions. The Company provides the supply and the demand sides for the release, search and management services of the transaction information.

Hangzhou Shunwang Technology Co., Ltd. develops and sells Internet entertainment networking platforms.  The Company's products provide safety management, system maintenance service, and entertainment content update service.

Hangzhou Shunwang Technology A (300113 CH)

Shanghai Ganglian E-Commerce Holdings Company Limited provides market information and B2B e-commerce services for steel and steel-related industries. The Company provides market information, research services and also offers business promotion to customers.

Hubei Century Network Technology Co. Ltd. provides internet content and service aggregation platforms. The Company delivers music, games, and other related products.

INESA Intelligent Tech Inc. operates in the IT industry. The Company designs and manages cloud servers and big data applications for businesses. INESA Intelligent also manufactures electronic components.

Longmaster Information & Technology Company Limited provides community-based phonic value-added services. The Company's main product is a large-scale telephone phonic social and entertainment platform.

Longmaster Information&Technology (300288 CH)

21Vianet Group, Inc. provides carrier-neutral Internet data center services. The Company hosts its customers' servers and networking equipment, as well as provides interconnectivity and managed network services to enable customers to deliver data across the Internet. 21Vianet conducts business in Beijing, China.

Beijing Sinnet Technology Company Limited provides customers with broadband access services, IDC and its value-added services, and other internet integrated services. The Company's core business are broadband access services, IDC and its value-added services.

mixi, Inc. operates community style website, mixi.  The Company sells advertising spaces on its website.  mixi also runs online recruiting services for IT related positions.

DeNA Co., Ltd. operates social media site, auction and shopping web site such as Mobage-town and Bidders.  DeNA also provides mobile-related services such as mobile game and community site.

Gogo Inc. provides in-flight connectivity systems and services. The Company offers online aircraft systems, wireless digital entertainment and other services in the commercial and business aviation markets.

Shutterstock Inc. operates a global marketplace for commercial digital imagery. The Company's online marketplace provides a freely searchable library of commercial digital images that our users can pay to license, download and incorporate into their work.

SMS CO.,LTD. is a website operator regarding elderly care.  On its websites, the company provides a variety of information contents related to employment placements for senior care assistants and doctors, as well as medical and nursing qualifications.

Megaport Limited operates as a software-based elastic connectivity provider. The Company develops an elastic connectivity platform that provides customers interconnectivity and flexibility between other networks and cloud providers connected to the platform. Megaport serves customers worldwide.

Cars.com Inc. operates an online automotive platform. The Company offers new and used vehicle listings, expert and consumer reviews, research tools, and other information which helps shoppers to buy, sell, and service their vehicles. Cars.com serves customers in the United States.

SUNeVision Holdings Limited, through its subsidiaries, operates Internet services centers and Information Technology (IT) facilities.  The Company also designs and installs SMATV, structural cabling and security systems as well as provides system development, solutions, and management services.  In addition, Sunevision invests in properties.

QuinStreet Inc. specializes in vertical marketing and media on the Internet. The Company focuses on clients in the education and financial services industries, as well as has a presence in the home services, business-to-business, or B2B, and healthcare industries.

Just Dial Ltd. operates a local search engine that provides comprehensive updated information. The Company offers a search engine that includes a variety of categories such as movies, hotels and resorts, taxis and car rentals, insurance, bars, and nightclubs. Just Dial markets its search engine to users throughout India.

Weibo Corp is a social media platform for people to create, distribute and discover Chinese-language content.  The Company offers users public self-expression in real time with a powerful platform for social interaction, as well as content aggregation and distribution.

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Weibo Corp (WB US)

Internet - 2M24 online retail sales recap

Based on NBS data, 2M24 online retail sales GMV/online physical goods GMV reached RMB2.2tn/1.8tn, up 15.3/14.4% YoY, which implied a two-year CAGR...

CMB International

China TMT: Maintain Buy XIAOMI’30-31s, XIAOMI 0’27 (CB)

Chinese TMT issuers are generally cash-rich with solid liquidity profiles. Most of them are in net cash positions and have strong coverage ratios...

CMB International

Weibo (WB US) – Solid Margin and Attractive Valuation; Wait for Top-Line Recovery

Total revenue dropped by 15% YoY (or -7% YoY on a constant currency basis) to US$414mn in 1Q23, inline with the consensus estimate.

CMB International

Weibo (WB US) – Gradual revenue and margin recovery in FY23

Weibo reported 4Q22 financial results on 1 Mar. 4Q22 total revenue declined by 27% YoY (-20% YoY on a constant currency basis) to US$448mn, in line...

CMB International

Weibo (WB US) – Recovery on the horizon despite ST pressure

Weibo faced pressure in 4Q22E due to tighter regulations on entertainment content and extreme disruptions on ads promotions from resurgence of...

CMB International

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