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.

Beijing-Shanghai High Speed Railway (601816 CH): Adjustment in Fare Price Not of Much Help

Beijing-Shanghai High Speed Railway (601816 CH): Good FY19 Result Means Nothing for FY20

Beijing-Shanghai High Speed Railway IPO: Initial Thoughts on the A-Share Listing

Beijing-Shanghai High Speed Railway (601816 CH): Poor 1Q20, Difficult to Justify High Multiples

Beijing-Shanghai High Speed Railway IPO: A-Share IPO Price Fixed at Rmb4.88

Equity Bottom-Up

Beijing-Shanghai High Speed Ra / Equity Bottom-Up

Beijing-Shanghai High Speed Ra (601816 CH)

<p>It is disappointing to see <a href="https://www.smartkarma.com/entities/beijing-shanghai-high-speed-railway-a" target="_blank" data-smartkarma-citation="entities:28433:1" rel="noopener">Beijing-Shanghai High Speed Railway (601816 CH)</a>'s net profit for 2Q20 declined significantly on a QoQ basis (-36.1%). 1H20 net profit of Rmb530m is just 7.5% of full-year consensus forecasts, suggesting substantial downside earnings revisions. Also, with Beijing-Fuzhou Railway Anhui Co., Ltd (BFRAC) making a loss of Rmb1.23bn in 1H20, such acquisition has turned out to be a major drag. </p><p>We believe the stock is expensive at 43.1x consensus PER. BSHR will continue to face challenges from the moderate pace of traffic recovery, highly inflexible cost structure and drag from BFRAC. We see risk for the stock to re-test levels close to its IPO price of Rmb4.88 given the headwinds. </p>

It is disappointing to see Beijing-Shanghai High Speed Railway (601816 CH)'s net profit for 2Q20 declined significantly on a QoQ basis (-36.1%). 1H20 net profit of Rmb530m is just 7.5% of full-year consensus forecasts, suggesting substantial downside earnings revisions. Also, with Beijing-Fuzhou Railway Anhui Co., Ltd (BFRAC) making a loss of Rmb1.23bn in 1H20, such acquisition has turned out to be a major drag. We believe the stock is expensive at 43.1x consensus PER. BSHR will continue to face challenges from the moderate pace of traffic recovery, highly inflexible cost structure and drag from BFRAC. We see risk for the stock to re-test levels close to its IPO price of Rmb4.88 given the headwinds. 

Beijing-Shanghai High Speed Railway (601816 CH): Weaker 2Q20 QoQ Showed the Tough Environment