Overseas Chinese Equities, Aequitas Research

Ming Lu

A veteran with 19-year experience in equity research.

Geographical coverage:
* Companies operating in China, but listed in Hong Kong and the U.S.
* Previously China A-share (listed in mainland China).

Equity sector coverage:
* Chinese App / Internet-based consumption in China, e.g., Alibaba, Tencent, etc.
* Previously covered education, transportation, telecom, power, bank, advertisement, hotel, etc.

Research methods:
* Generally bottom-up.
* Talk to related people on the ground.  Talk to readers and independent writers for analyzing a news portal.  Talk to parents and teachers for analyzing a tutoring school. 
* Visit stores and show photos as evidence in notes.
* Do technical analysis when finding a short-seller attacking an equity.

Languages:
* English
* Mandarin Chinese (Official language of China)
* Shanghainese (Language of Shanghai, the most developed city in China)
* Cantonese (Language of Hong Kong and Canton Province, one of the most developed provinces in China)

Overseas Chinese Equities

Ctrip.com (携程) Placement - Baidu Still Has More to Sell but Only After 180 Days

Trip.com (TCOM): Channel Checks Suggest Market Share Expansion in the US

2020 High Conviction: Overweight Tongcheng-Elong (780:HK) A Prime Acquisition Target for Trip.com

Ctrip (CTRP): Highest Q1 Operating Margin Since 2014, Upgrade to HOLD

(Some) Promises Kept in 1Q19, but Retaining Sell Rating and $36 Target Price for Ctrip.com

Re-Initiating Coverage of Ctrip.com: Challenges to Resurface in 2H19

Equity Bottom-Up

<ul>
<li>Ctrip (CTRP)’s operating margin continued to improve in 2Q19, mainly due to the YoY decrease in sales and marketing expenses.</li>
<li>CTRP announced it improved marketing efficiency, but we believe the real reason is CTRP benefits from the weak advertising market.</li>
<li>We believe there is an upside of 7%.</li>
</ul>


Ctrip (CTRP)’s operating margin continued to improve in 2Q19, mainly due to the YoY decrease in sales and marketing expenses.
CTRP announced it improved marketing efficiency, but we believe the real reason is CTRP benefits from the weak advertising market.
We believe there is an upside of 7%.


Ctrip.com (CTRP): Well Controlled Marketing Expenses Actually Benefit from Weak Advertising Market