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.

Equity Bottom-Up

<ul><li>Maintain BUY. We estimate that Meidong’s net profit excluding impairment and withholding tax impact in 2H23E could be a similar level to that in 1H23, as the higher portion of after-sales service profit and cost cuts could offset the HoH decline for new-car GPM.</li><li>However, we are of the view that impairment for goodwill and/or intangible assets is likely in 2H23E.</li><li>We project FY24E net profit to be RMB371mn, as Porsche’s new-car GPM is likely to improve from 2Q24E. </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.

Maintain BUY. We estimate that Meidong’s net profit excluding impairment and withholding tax impact in 2H23E could be a similar level to that in 1H23, as the higher portion of after-sales service profit and cost cuts could offset the HoH decline for new-car GPM.However, we are of the view that impairment for goodwill and/or intangible assets is likely in 2H23E.We project FY24E net profit to be RMB371mn, as Porsche’s new-car GPM is likely to improve from 2Q24E. 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 Meidong Auto (1268 HK) – The Terrible 2023 Is Behind Us

<ul><li>Upgrade to BUY. Meidong’s share price has fallen 65% since our downgrade on 1 Apr 2023.</li><li>We are of the view that its new-car gross margin probably hit bottom in 1H23, although recovery may take a while.</li><li>Porsche’s new-car gross margin appears to recover the fastest among traditional luxury brands and Meidong could benefit the most among its peers. </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.

Upgrade to BUY. Meidong’s share price has fallen 65% since our downgrade on 1 Apr 2023.We are of the view that its new-car gross margin probably hit bottom in 1H23, although recovery may take a while.Porsche’s new-car gross margin appears to recover the fastest among traditional luxury brands and Meidong could benefit the most among its peers. 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 Meidong Auto (1268 HK) – The Worst Is Over

Thematic (Sector/Industry)

<ul><li>China’s passenger-vehicle (PV) retail sales volume fell 1% YoY in first four months of 2023, 2% higher than our forecast made in Dec 2022.</li><li>Wholesale volume also rose 7% YoY YTD, 3% higher than our prior forecast, largely due to doubled PV exports in the first four months of 2023.</li><li>Automakers in China started to cut inventories in Apr 2023, as we had expected.</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.

China’s passenger-vehicle (PV) retail sales volume fell 1% YoY in first four months of 2023, 2% higher than our forecast made in Dec 2022.Wholesale volume also rose 7% YoY YTD, 3% higher than our prior forecast, largely due to doubled PV exports in the first four months of 2023.Automakers in China started to cut inventories in Apr 2023, as we had expected.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 Auto Sector – Mixed picture ahead as inventory risk lingers

<ul><li>We summarize the Jun 2024 price discounts at dealers for major automakers in this report.</li><li>Note that such discounts for each automaker are calculated based on the weighted average of May 2024 retail sales volume for each model, as Jun 2024 retail sales volume data have not been released yet.</li><li>The industrywide average discounts widened by 0.6ppts MoM in Jun based on our calculations, similar to the pace in May, again driven by German and Japanese brands.</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.

We summarize the Jun 2024 price discounts at dealers for major automakers in this report.Note that such discounts for each automaker are calculated based on the weighted average of May 2024 retail sales volume for each model, as Jun 2024 retail sales volume data have not been released yet.The industrywide average discounts widened by 0.6ppts MoM in Jun based on our calculations, similar to the pace in May, again driven by German and Japanese brands.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.

Auto - Chinese brands’ 2Q earnings could be resilient

<ul><li>We summarize the Jun 2024 leading indicators as below, including the number of leads, customer flows and new orders generated, for Tesla, NIO, Li Auto, Xpeng, BYD and Aion.</li><li>Note that such data are based on a sample size of 96 stores (15- 18 stores for each brand) in 15 cities in China.</li><li>The following data reflect samestore metrics, and the metrics on a company level could be better than these figures, as most players are still expanding their sales network.</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.

We summarize the Jun 2024 leading indicators as below, including the number of leads, customer flows and new orders generated, for Tesla, NIO, Li Auto, Xpeng, BYD and Aion.Note that such data are based on a sample size of 96 stores (15- 18 stores for each brand) in 15 cities in China.The following data reflect samestore metrics, and the metrics on a company level could be better than these figures, as most players are still expanding their sales network.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.

Auto - Jun Indicators Mixed as BYD, NIO Outperformed

China

Beijing Bashi Media Co., Ltd. provides urban bus transportation and advertising services.  The Company also provides taxi, inter-provincial transportation, car rental, and other transportation related services.

Wuxi Commercial Mansion Grand Orient Co., Ltd. operates a department store retail business. Its department stores sell a variety of products including home appliances, apparel, textiles, and leather products.  Wuxi Commercial also sells cars. The Company sells its general merchandise through its own website www.eastall.com and has operation in food serve.

Wuxi Commercial Mansion Grand Orient Co (600327 CH)

Fujian Zhangzhou Development Co., Ltd., trades automobile, manages and operates toll roads, produces and distributes tap water, and provides waste management services.

China Yongda Automobiles Services Holdings Ltd. retails passenger vehicles. The Company sells new and used vehicles and offers automobile rentals. China Yongda Automobiles also provides service.

China Yongda Automobile Services Hldg (3669 HK)

Global Top E-Commerce Co.,Ltd. is in the businesses of cross-border E-commerce and the design, production and marketing of trouseres for men and women.

Global Top E-Commerce Co., Ltd. A (002640 CH)

Pang Da Automobile Trade Company Limited sells, repairs and provides maintenance services for cars and construction machinery.

Beijing Digital Telecom Co., Ltd. is a communication company that services The People's Republic of China.  The Company is a distributor of communications terminals and related services. It also retails mobile communications and digital products.

Beijing Sanfo Outdoor Products Co. Ltd. offers outdoor sports products. The Company operates retail stores throughout China, providing outdoor clothing, gear, tents, and other related products. Beijing Sanfo Outdoor Products also offers direct sales via the internet, telephone, and mail.

Shanghai Aiyingshi Co., Ltd. retails maternal and child products. The Company provides children's dairy products, diapers, feeding and maternity supplies, toys, baby clothing and shoes, and other related products. Shanghai Aiyingshi markets its products in China.

GOME Retail Holdings Limited retails household appliances. The Company provides televisions, washing machines, computers, mobile phones, digital devices, air conditioners, and other products. GOME Retail Holdings also provides equipment repairing, recycling, and other services.

VT HOLDINGS CO., LTD. sells automobiles produced by Honda, replacement parts, and used cars.  The Company provides vehicle maintenance and repair services and arranges automobile financing and insurance.

PC Jeweller Ltd. manufacture, retails, and wholesale jewelry.  The Company sells jewelry through its showrooms and over the Internet.  PC Jeweller offers a wide range of products including gold jewellery, diamond jewellery and other jewellery including silver articles, with a focus on diamond jewellery and jewellery for weddings.

Haverty Furniture Companies, Inc. sells home furnishings.  The Company stores are located in southern and central United States.  Haverty's offers brand name furniture, such as Broyhill, Thomasville, Lane/Action, La-Z-Boy, and Clayton Marcus.

Cortina Holdings Limited retails and distributes luxury watches in the Asia Pacific region.  The Company also trades, imports, and exports pens, lighters, and clocks.

Shinsegae International Co., Ltd. was spun off from Shinsegae in 1996.  The company imports and distributes famous foreign brands and manufactures/distribut es domestic brand.  The Company's line of business includes the wholesale distribution of men's and women's apparel.

UNITED ARROWS LTD., operates fashion stores, specializing in casual clothing and accessory for men and women.  The Company has stores nationwide.  Main forces are United Arrows, Green Label Relaxing and Chrome Hearts.

America's Car-Mart, Inc, sells and finances the sale of used automobiles and trucks.  The Company operates its dealerships primarily in small cities and rural locations throughout the South-Central United States and provides financing for substantially all of its customers.  Car-Mart's customers are principally consumers with limited or damaged credit histories.

Designer Brands Inc. designs, produces, and retails footwear and accessories. The Company offers shoes, boots, sandals, sneakers, socks, handbags, and accessories. Designer Brands serves customers in the United States.

Symphony Holdings Limited, through its subsidiaries, manufactures and trades footwear products.  The Company also invests in properties.

PT Indomobil Sukses Internasional Tbk assembles, and distributes automobiles, buses, trucks, motorcycles, and their related parts. The Company provides automotive maintenance, financing, and rental services.  Indomobil also trades used cars.

China Meidong Auto Holdings Limited is an automobile dealership and maintenance group in China.

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China MeiDong Auto (1268 HK)