In today’s briefing:
- Meituan Bear Pressure Accelerating
- Tencent (700 HK): Revenue Decreased for First Time, Margin Recovering, Price Overly Impacted
- SSE50 Index Rebalance Preview: Sector Rotation To Continue
- JD.com (9618 HK): Pre-2Q22 Earnings, Will Slow Down and Then Recover from Lockdown
- Pre-IPO Weimeizi (Guangdong) – The Market Position Is Not Solid
- Morning Views Asia: Bharti Airtel, Country Garden Holdings Co, Fantasia Holdings Group Co, Meituan
Meituan Bear Pressure Accelerating
- June 27 call to sell strength in line and showing increasing downside pressure below the 185 support (now resistance).
- Dual top at 210 induced a turn well under trendline resistance. Break of bear wedge support confirmed the macro sell signal.
- Below 166 targets 140 where a stall in the decline/bounce is due (resistance near 160-66) but expected to give way for a test on the 110 low zone.
Tencent (700 HK): Revenue Decreased for First Time, Margin Recovering, Price Overly Impacted
- In 2Q22, revenue decreased YoY for the first time on record.
- Unexpectedly, FinTech revenue stopped growing in 2Q22, as users are conservative in borrowing and investing money.
- However, we still believe Tencent’s stock price is overly impacted.
SSE50 Index Rebalance Preview: Sector Rotation To Continue
- Over 80% of the way through the review period for the December rebalance, we see 7 stocks in inclusion/exclusion zone. However, there can be a maximum of 5 changes.
- We estimate a one-way turnover of 3.9% at the December rebalance leading to a one-way trade of CNY 2.85bn.
- The potential adds have outperformed the potential deletes and the SSE50 Index (SSE50 INDEX) by a wide margin over the last few months.
JD.com (9618 HK): Pre-2Q22 Earnings, Will Slow Down and Then Recover from Lockdown
- Many consumers bought household freezers after the lift of lockdown.
- Strict rules on physical stores drive consumers to online e-commerce platform.
- Total express parcels increased by 8% YoY in China in July.
Pre-IPO Weimeizi (Guangdong) – The Market Position Is Not Solid
- WEIMEIZI develops the oral care market by means of large promotion and marketing so as to attract consumers, which helps Saky become one of the top brands in China.
- However, with the layout of other long-lasting reputable brands and the entry of new brands, how to maintain the market share in fierce competition has become an important issue.
- WEIMEIZI’s leading market position is not solid, unless it could create differentiated products and keep up with industry trends closely.
Morning Views Asia: Bharti Airtel, Country Garden Holdings Co, Fantasia Holdings Group Co, Meituan
Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.
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