HK/China Equity Long-Short

Osbert Tang, CFA

Osbert Tang is an equity analyst with over 20 years of experience with focuses on China transport, infrastructure, industrials and utilities sectors. He has been based in Shanghai since 2003, accumulated nearly 20 years of on-ground knowledge on the Chinese economy and financial markets, and has a wealth of contacts with China corporates and government entities. 

Osbert has received votes from top-tier institutional investors and has been a highly-ranked transport and infrastructure analyst in the Asiamoney, Institutional Investors and Greenwich surveys. In addition to his extensive experience with international investment banks including RBS, ABN AMRO (both served as Shanghai Chief Representative), Paribas Asia Equity, Maybank Kim Eng and DBS Securities, he has been a senior analyst with Moody’s Investors Service with focus on ratings of China infrastructure and related LGFV issuers. He has also worked in the area of strategic development at Sun Hung Kai Properties Limited. 

Osbert holds a BBA from the Chinese University of Hong Kong, an MBA from the University of Texas at Austin and a MSSc in Applied Psychology from the City University of Hong Kong. He was accredited with the CFA charter in 1997, and is a member of both British Psychological Society and Hong Kong Psychological Society.

Air China (753 HK): Sending Out Stronger Signals

Travelsky (696): Recovery and Undervalued Vs Airlines

Samsonite (1910): Channel Checks Recovery

2021 High Conviction Update: Chinese Airlines Pair Trade - Almost Getting to the Inflection Point

2021 High Conviction: Pair Trade - Long Air China (753 HK), Short China Southern (1055 HK)

Chinese Airlines: A Reversal of Relative Performance Between the Airlines Gets Closer

Chinese Airlines: Initial FY20 Results Suggest Tough Market Has Already Begun

Equity Bottom-Up

<p>While the Mar traffic figures continued to show that <a href="https://www.smartkarma.com/entities/air-china-ltd-h" target="_blank" data-smartkarma-citation="entities:8239:1" rel="noopener">Air China Ltd (H) (753 HK)</a> is still lagging behind <a href="https://www.smartkarma.com/entities/china-southern-airlines-co-ltd" target="_blank" data-smartkarma-citation="entities:1078:1" rel="noopener">China Southern Airlines (1055 HK)</a> in many areas, there is no doubt that such underperformance is reducing sequentially. The latest figures show that Air China is narrowing its gap on passenger load factor, seeing rebound in international passenger traffic, registering better cargo and mail strengths and catching up on freight and overall load factors.</p><p>We believe many of these attributes fit well into our arguments for a reversal of CSA's outperformance against Air China in this year as we written in <a href="https://www.smartkarma.com/insights/2021-high-conviction-pair-trade-long-air-china-753-hk-short-china-southern-1055-hk" target="_blank" data-smartkarma-citation="insights:45584" rel="noopener">2021 High Conviction: Pair Trade - Long Air China (753 HK), Short China Southern (1055 HK)</a>. The relative valuation also suggests CSA is richly valued against Air China. For details, please refer to our attached update presentation file on the trade. </p>

While the Mar traffic figures continued to show that Air China Ltd (H) (753 HK) is still lagging behind China Southern Airlines (1055 HK) in many areas, there is no doubt that such underperformance is reducing sequentially. The latest figures show that Air China is narrowing its gap on passenger load factor, seeing rebound in international passenger traffic, registering better cargo and mail strengths and catching up on freight and overall load factors.We believe many of these attributes fit well into our arguments for a reversal of CSA's outperformance against Air China in this year as we written in 2021 High Conviction: Pair Trade - Long Air China (753 HK), Short China Southern (1055 HK). The relative valuation also suggests CSA is richly valued against Air China. For details, please refer to our attached update presentation file on the trade. 

Shanghai International Airport (600009 CH)

Beijing Capital International Airport (BCIA) (694 HK)

Beijing Capital International Airport (BCIA)

Guangzhou Baiyun International Airport (600004 CH)

Air China (753 HK): Further Evidences of Improving Against China Southern (1055 HK)