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Articles from Caixin Global

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Cross Asset Strategy

<ul><li>In Depth: The shadowy businessman behind a multibillion-dollar bank swindle</li><li>Chongqing monkeypox patient caught the disease in Berlin, China CDC says</li><li>Former Shanghai police chief sentenced to life in prison for corruption</li></ul>

In Depth: The shadowy businessman behind a multibillion-dollar bank swindleChongqing monkeypox patient caught the disease in Berlin, China CDC saysFormer Shanghai police chief sentenced to life in prison for corruption

CX Daily: The Shadowy Businessman Behind a Multibillion-Dollar Bank Swindle

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

<ul>
<li>The Aug China Express Development Index points to further industry recovery; and as the leader with 23% (+2pp YoY) market share, <a href="https://www.smartkarma.com/entities/zto-express-cayman-inc" target="_blank" data-smartkarma-citation="entities:33488:1" rel="noopener">ZTO Express (2057 HK)</a> should ride on the uptrend. </li>
<li>Sustained volume outperformance, upside on pricing and excellent cost control capability are drivers in 2H22. We are also comfortable with its solid financial position. </li>
<li>ZTO Express has above-average earnings quality and enjoys benefits from industry consolidation. Its on par valuation with the industry makes the stock appealing.</li>
</ul>


The Aug China Express Development Index points to further industry recovery; and as the leader with 23% (+2pp YoY) market share, ZTO Express (2057 HK) should ride on the uptrend. 
Sustained volume outperformance, upside on pricing and excellent cost control capability are drivers in 2H22. We are also comfortable with its solid financial position. 
ZTO Express has above-average earnings quality and enjoys benefits from industry consolidation. Its on par valuation with the industry makes the stock appealing.


ZTO Express (2057 HK/​ZTO US): Quality Speaks for Itself

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zto-express-cayman-inc" target="_blank" data-smartkarma-citation="entities:33488:1" rel="noopener">ZTO Express Cayman Inc (2057 HK)</a> has outperformed industry volume growth in 1Q22 and such trend continues into 2Q22 with good ASP improvement and cost control. </li>
<li>Its strong operating cash flow and declining capex will lead to an accumulation of cash over the next few years, adding to the 1Q22 net cash position of Rmb4.1bn. </li>
<li>We think the stock's underperformance against peers not warranted. With a below-sector earnings multiple, leadership position and successful business model, we consider ZTO a "Growth at a reasonable price".</li>
</ul>



ZTO Express Cayman Inc (2057 HK) has outperformed industry volume growth in 1Q22 and such trend continues into 2Q22 with good ASP improvement and cost control. 
Its strong operating cash flow and declining capex will lead to an accumulation of cash over the next few years, adding to the 1Q22 net cash position of Rmb4.1bn. 
We think the stock's underperformance against peers not warranted. With a below-sector earnings multiple, leadership position and successful business model, we consider ZTO a "Growth at a reasonable price".


ZTO Express (2057 HK/ZTO US): Growth at a Reasonable Price

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>In <a href="https://www.smartkarma.com/insights/sf-intra-city-industrial-ipo-delivering-losses" target="_blank" data-smartkarma-citation="insights:61272" rel="noopener">SF Intra-City Industrial IPO: Delivering Losses</a>, we noted that SF Intra-city’s fundamentals are less than inspiring. </li>
<li>In <a href="https://www.smartkarma.com/insights/sf-intra-city-industrial-ipo-valuation-insights" target="_blank" data-smartkarma-citation="insights:61939" rel="noopener">SF Intra-City Industrial IPO: Valuation Insights</a>, we noted that the IPO price is unattractive in the context of its unappetizing mix of high growth at the cost of losses.  </li>
<li>The IPO price is HK$16.42 and it closed -9% lower in the grey market. Our base-case DCF value of HK$15.44 per share is a 6% downside to the IPO price.  </li>
</ul>


In SF Intra-City Industrial IPO: Delivering Losses, we noted that SF Intra-city’s fundamentals are less than inspiring. 
In SF Intra-City Industrial IPO: Valuation Insights, we noted that the IPO price is unattractive in the context of its unappetizing mix of high growth at the cost of losses.  
The IPO price is HK$16.42 and it closed -9% lower in the grey market. Our base-case DCF value of HK$15.44 per share is a 6% downside to the IPO price.  


SF Intra-City Industrial IPO: Trading Debut

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hangzhou-sf-intra-city-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:34916:1" rel="noopener">SF Intra-City (9699 HK)</a> is the largest Chinese independent third-party on-demand delivery service provider. It launched an HKEx IPO to raise net proceeds of $273 million at the IPO mid-point. </li>
<li>In <a href="https://www.smartkarma.com/insights/sf-intra-city-industrial-ipo-delivering-losses" target="_blank" data-smartkarma-citation="insights:61272" rel="noopener">SF Intra-City Industrial IPO: Delivering Losses</a>, we noted that SF Intra-city’s fundamentals are less than inspiring. </li>
<li>While the valuation is undemanding vs peers, we give the IPO a pass as SF Intra-city offers an unappetizing mix of high growth at the cost of losses/cash burn.   </li>
</ul>



SF Intra-City (9699 HK) is the largest Chinese independent third-party on-demand delivery service provider. It launched an HKEx IPO to raise net proceeds of $273 million at the IPO mid-point. 
In SF Intra-City Industrial IPO: Delivering Losses, we noted that SF Intra-city’s fundamentals are less than inspiring. 
While the valuation is undemanding vs peers, we give the IPO a pass as SF Intra-city offers an unappetizing mix of high growth at the cost of losses/cash burn.   


SF Intra-City Industrial IPO: Valuation Insights

China

YTO Express Group Co., Ltd. provides global express services. The Company also provides general cargo warehousing, domestic air transport agency, car rental, supply chain management, and other related services throughout China..

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YTO Express (600233 CH)

CX Daily: The Shadowy Businessman Behind a Multibillion-Dollar Bank Swindle

In Depth: The shadowy businessman behind a multibillion-dollar bank swindle. Chongqing monkeypox patient caught the disease in Berlin, China CDC says

Caixin Global

ZTO Express (2057 HK/ZTO US): Quality Speaks for Itself

Industry figures suggest express market to continue recover in Aug and ZTO Express is best benefited given its number one position. Upside of ASP...

Osbert Tang, CFA

ZTO Express (2057 HK/ZTO US): Growth at a Reasonable Price

ZTO Express has outperformed industry volume growth with healthy pricing levels so far into FY22. We anticipate it will continue to add net cash to...

Osbert Tang, CFA

SF Intra-City Industrial IPO: Trading Debut

The IPO price is HK$16.42 and shares will be listed on 14 Dec. Our base-case DCF value of HK$15.44 per share is a 6% downside to the IPO price.

Arun George

SF Intra-City Industrial IPO: Valuation Insights

While the valuation is undemanding vs peers, we give the IPO a pass as SF Intra-city offers an unappetizing mix of high growth at the cost of...

Arun George

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CX Daily: The Shadowy Businessman Behind a Multibillion-Dollar Bank Swindle

In Depth: The shadowy businessman behind a multibillion-dollar bank swindle. Chongqing monkeypox patient caught the disease in Berlin, China CDC says

Caixin Global

ZTO Express (2057 HK/​ZTO US): Quality Speaks for Itself

Industry figures suggest express market to continue recover in Aug and ZTO Express is best benefited given its number one position. Upside of ASP...

Osbert Tang, CFA

ZTO Express (2057 HK/ZTO US): Growth at a Reasonable Price

ZTO Express has outperformed industry volume growth with healthy pricing levels so far into FY22. We anticipate it will continue to add net cash to...

Osbert Tang, CFA

SF Intra-City Industrial IPO: Trading Debut

The IPO price is HK$16.42 and shares will be listed on 14 Dec. Our base-case DCF value of HK$15.44 per share is a 6% downside to the IPO price.

Arun George

SF Intra-City Industrial IPO: Valuation Insights

While the valuation is undemanding vs peers, we give the IPO a pass as SF Intra-city offers an unappetizing mix of high growth at the cost of...

Arun George

ZTO Express (2057 HK/ZTO US): Quality Speaks for Itself