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.

Sinotrans (598 HK): Encouraging Industry Datapoints Bode Well for Outlook

China Logistics: Key Beneficiaries of China's Greater Bay Area Postal and Express Development

Sinotrans (598 HK): Quick Take on the Good Underlying 4Q20 and Positive Profit Alert for 1Q21

Sinotrans (0598 HK): China Merchants Group to Increase Stake - A Target for Privatisation?

Sinotrans (598 HK): Very Encouraging Profit Recovery Momentum in 2Q20

Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/sinotrans-limited-h" target="_blank" data-smartkarma-citation="entities:1321:1" rel="noopener">Sinotrans (598 HK)</a> logged a massive beat in 3Q20 with a 44.4% YoY surge in profit, representing an impressive pick-up from -58.4% in 1Q20 and +4.0% in 2Q20. Operating statistics have generally accelerated in 3Q20, reflecting good demand momentum. Moreover, its cash generating ability is showcased by a 58.4% YoY increase in operating cash flow in the quarter.</p><p>We believe the solid pace will sustain into 4Q20, resulting in a positive profit growth in the full year. We see a ROE of 9.4% in FY20 with a marginal net debt position. The 50.6% rally in share price since the trough in late-May has only lifted its P/B from -2SD below average to -1SD now. Yet, it is still trading on just 0.48x P/B, 5.2x PER and 6.1% dividend yield for FY20F. Longer-term, the REIT angle will further narrow the gap between its share price and book value, in our view.</p>

Sinotrans (598 HK) logged a massive beat in 3Q20 with a 44.4% YoY surge in profit, representing an impressive pick-up from -58.4% in 1Q20 and +4.0% in 2Q20. Operating statistics have generally accelerated in 3Q20, reflecting good demand momentum. Moreover, its cash generating ability is showcased by a 58.4% YoY increase in operating cash flow in the quarter.We believe the solid pace will sustain into 4Q20, resulting in a positive profit growth in the full year. We see a ROE of 9.4% in FY20 with a marginal net debt position. The 50.6% rally in share price since the trough in late-May has only lifted its P/B from -2SD below average to -1SD now. Yet, it is still trading on just 0.48x P/B, 5.2x PER and 6.1% dividend yield for FY20F. Longer-term, the REIT angle will further narrow the gap between its share price and book value, in our view.

Sinotrans (598 HK): Massive Beat in 3Q20 Profit