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>While SANYI’s net profit in 2Q23 grew only 19% YoY to RMB552mn, it was largely due to an increase in R&amp;D spending.</li><li>We do not think this is negative given SANYI’s good track record in new product development through R&amp;D commitment.</li><li>The strong revenue growth (+54% YoY) and gross margin expansion (+0.9ppt YoY, +3.3ppt QoQ to 27.8%) in 2Q23 are impressive, in our view. </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.

While SANYI’s net profit in 2Q23 grew only 19% YoY to RMB552mn, it was largely due to an increase in R&amp;D spending.We do not think this is negative given SANYI’s good track record in new product development through R&amp;D commitment.The strong revenue growth (+54% YoY) and gross margin expansion (+0.9ppt YoY, +3.3ppt QoQ to 27.8%) in 2Q23 are impressive, in our view. 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.

SANY International (631 HK) – Net Profit in 2Q23 +19% YoY

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Oil & Natural Gas Corp / Technical Analysis

<ul>
<li>MSCI EM (EEM-US) continues to show signs of bottoming as it has held above our $37-$37.50 line-in-the-sand. </li>
<li>Major 1+ year resistance on the EEM-US is at $42, and a breakout would mean the bottom is in (and would be a buy signal).</li>
<li>Favor EM over EAFE due to 2.5-year downtrend reversal in the EAFE vs. EM ratio. Top Overweights: Taiwan, India, Greece; Attractive EM Sectors: Energy, Technology, Consumer Discretionary, Financials</li>
</ul>


MSCI EM (EEM-US) continues to show signs of bottoming as it has held above our $37-$37.50 line-in-the-sand. 
Major 1+ year resistance on the EEM-US is at $42, and a breakout would mean the bottom is in (and would be a buy signal).
Favor EM over EAFE due to 2.5-year downtrend reversal in the EAFE vs. EM ratio. Top Overweights: Taiwan, India, Greece; Attractive EM Sectors: Energy, Technology, Consumer Discretionary, Financials


MSCI Emerging Market Index Testing 1+ Year Resistance; Favor EM over EAFE; Top EM Buys Highlighted

<ul><li>We, together with &gt;30 investors, joined SANYI’s plant visit tour in Zhuhai’s port machinery production base yesterday (25 July).</li><li>Key positives: (1) SANYI is confident of achieving revenue growth of 100%/50% YoY in overseas port machinery in 2023E/24E; (2) revenue from telescopic forklift will potentially reach RMB1bn in 2023E and double in 2024E; (3) electrification of reach stackers &amp; empty container handlers is on a good track; (4) gross margin of large port machinery is improving.</li><li>The positive management tone reaffirms our positive stance on the structural growth outlook of SANYI. </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, together with &gt;30 investors, joined SANYI’s plant visit tour in Zhuhai’s port machinery production base yesterday (25 July).Key positives: (1) SANYI is confident of achieving revenue growth of 100%/50% YoY in overseas port machinery in 2023E/24E; (2) revenue from telescopic forklift will potentially reach RMB1bn in 2023E and double in 2024E; (3) electrification of reach stackers &amp; empty container handlers is on a good track; (4) gross margin of large port machinery is improving.The positive management tone reaffirms our positive stance on the structural growth outlook of SANYI. 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.

SANY International (631 HK) – Positive Takeaways from Zhuhai Plant Visit

Thematic (Sector/Industry)

<ul><li>According to the preliminary data from CME, China’s excavator sales dropped 26% YoY to ~13.2k units.</li><li>Sales in China remained weak with an estimated 49% YoY decline to 4.7k units in Jul, which is not a surprise given the lack of powerful stimulus policies.</li><li>Export, which had been strong since 2020, however, starts to see a loss of momentum. Export volume is expected to drop 2% YoY to 8.5k units in Jul, according to CME. </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.

According to the preliminary data from CME, China’s excavator sales dropped 26% YoY to ~13.2k units.Sales in China remained weak with an estimated 49% YoY decline to 4.7k units in Jul, which is not a surprise given the lack of powerful stimulus policies.Export, which had been strong since 2020, however, starts to see a loss of momentum. Export volume is expected to drop 2% YoY to 8.5k units in Jul, according to CME. 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 Construction Machinery – Export of Excavator Running Out of Steam

<ul><li>We project Li Auto’s net profit to rise 27% QoQ to RMB 1.2bn in 2Q23E. Profitability in FY24E could also beat expectation on greater economies of scale.</li><li>Apart from its products, we like the Company’s high self-discipline in costs and business expansion even as it is much more resourceful than before.</li><li>We project Li Auto’s 2Q23E revenue to more than triple YoY to RMB 27.9bn, as its sales volume beat guidance.</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 project Li Auto’s net profit to rise 27% QoQ to RMB 1.2bn in 2Q23E. Profitability in FY24E could also beat expectation on greater economies of scale.Apart from its products, we like the Company’s high self-discipline in costs and business expansion even as it is much more resourceful than before.We project Li Auto’s 2Q23E revenue to more than triple YoY to RMB 27.9bn, as its sales volume beat guidance.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.

CMBI Research Focus List (July Edition) – Our best high conviction stock ideas

China

Sany Heavy Equipment International Holdings Co Ltd. manufactures coal mining equipment, including roadheaders.

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Sany Heavy Equipment (631 HK)

SANY International (631 HK) – Net Profit in 2Q23 +19% YoY

The strong revenue growth (+54% YoY) and gross margin expansion (+0.9ppt YoY, +3.3ppt QoQ to 27.8%) in 2Q23 are impressive, in our view.

CMB International

MSCI Emerging Market Index Testing 1+ Year Resistance; Favor EM over EAFE; Top EM Buys Highlighted

MSCI EM Index $EEM Testing 1+ Year Resistance; Favor EM over EAFE $EFA. Top EM Country Overweights: Taiwan, India, Greece; Attractive EM Sectors:...

Vermilion Research

SANY International (631 HK) – Positive Takeaways from Zhuhai Plant Visit

We, together with >30 investors, joined SANYI’s plant visit tour in Zhuhai’s port machinery production base yesterday (25 July).

CMB International

China Construction Machinery – Export of Excavator Running Out of Steam

Sales in China remained weak with an estimated 49% YoY decline to 4.7k units in Jul, which is not a surprise given the lack of powerful stimulus...

CMB International

CMBI Research Focus List (July Edition) – Our best high conviction stock ideas

We project Li Auto’s net profit to rise 27% QoQ to RMB 1.2bn in 2Q23E. Profitability in FY24E could also beat expectation on greater economies of...

CMB International

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