20211124-马银证券_香港_-每日港股简评_2页_140kb

Market Summary

Core Content Overview

This summary provides an overview of recent market developments in Hong Kong and China, focusing on stock performance, sector trends, and company updates. Key areas include the performance of tech stocks, the express delivery sector, Macau gaming, and updates from major companies such as Xiaomi, Geely Auto, and Luk Fook.

Market Performance

• Hong Kong Stocks:

  • The Hang Seng Index dropped to its lowest level in six weeks, falling 299 points to 24,651.
  • The daily turnover was HKD129.8 billion.
  • Tech stocks such as Alibaba-SW (9988 HK), Tencent (700 HK), and BiliBili-SW (9626 HK) faced significant selling pressure.

• Company Performance:

  • Kuaishou-W (1024 HK):
    • Released better-than-expected 3Q21 results.
    • Revenue reached RMB20.4 billion (+33% YoY), exceeding the consensus forecast of RMB20 billion.
    • Adjusted net loss of RMB4.8 billion, lower than the consensus forecast of RMB7.2 billion.
  • Chow Tai Fook (1929 HK):
    • 1HFY22 revenue, gross profit, and net profit rose by 79%, 32.5%, and 60.4% YoY, respectively, to HKD44.1 billion, HKD10.7 billion, and HKD3.5 billion.

Sector News

China Express

• Industry Performance:
  • October parcel volume reached a new high of 99.5 billion USD (+21% YoY), up from +17% YoY in September.
  • However, the industry average selling price (ASP) declined by 7.2% in October, compared to a 4.3% decline in September.
• Market Concentration:
  • The market concentration ratio for the largest eight players remained at 80.8% for four consecutive months.
  • Market expects this ratio to increase further, especially after the consolidation of J&T Express and Best Express.
• Future Outlook:
  • Parcel volume from 1-16 November rose by 18% YoY, in line with the previous full month estimate of ~20% YoY.
  • The market is optimistic about the sector's profitability improvement in 2022E and expects ASP to remain high even after the Double-11 event.

Macau Gaming

• GGR Trends:
  • Gross gaming revenue (GGR) trend remained stable in November.
  • As of 21 November, the daily GGR was MOP223 million, up from MOP104 million in October.
• Visitation:
  • Daily visitor numbers increased significantly, with a run-rate of 26,655 between 12-18 November, compared to 10,622 in October.
  • On 19 November, Macau recorded 35,525 tourist arrivals, surpassing the daily run-rate during Labour Day Golden Week.
• Policy Change:
  • On 22 November, the Zhuhai government eased the NAT validity requirement for Macau visitors to 7 days, starting from 23 November 2021.
  • This policy change is expected to boost GGR for the remainder of 2021E.
• Near-Term Focus:
  • Market attention is on laggards such as Sands China (1928 HK) and MGM China (2282 HK).

China Tech News

• Antitrust Fines:
  • China's State Administration of Market Regulation fined several tech companies, including Alibaba-SW (9988 HK), JD-SW (9618 HK), Tencent (700 HK), Baidu-SW (9888 HK), and ByteDance, for failing to disclose 43 deals that violated antitrust legislation.
  • Each violation resulted in a fine of RMB500,000.
• Latest Violation:
  • The most recent violation involved an agreement between Baidu and Zhejiang Geely Holdings to create a new-energy vehicle company.

Company Updates

Xiaomi-W (1810 HK)

• Financial Results:
  • Reported better-than-expected 3Q21 results.
  • Revenue of RMB78 billion (+8.2% YoY) and adjusted net profit of RMB5.1 billion (+25.4% YoY), both higher than the consensus forecast.
• Performance Drivers:
  • Higher-than-expected smartphone gross profit margin of 12.8% (+4.4ppt YoY).
  • Stable growth in IoT, lifestyle products, and internet segments.
• New Product Launches:
  • Introduced Xiaomi Smart Glasses in September, featuring visualized information display and interactive features.
  • Launched Loop LiquidCool Technology in November to enhance smartphone heat dissipation under heavy usage.

Geely Auto (175 HK)

• Strategic Focus:
  • Focused on promoting HiX (PHEV technology) and Zeekr in 2022E.
  • Plans to roll out two versions of HiX models with price parity to ICEV models.
  • Aims to carry out brand premiumization with more advanced technology equipment.
• Sales Expectations:
  • Expected to sell approximately 2,000 units of Zeekr 001 in November and increase to around 5,000 units in December.
  • Demand for Zeekr is healthy, with record-high order inflows in November following delivery and test drives.

Luk Fook (590 HK)

• Profit Alert:
  • Released a positive profit alert, expecting a 120% YoY net profit growth in 1HFY21.
• Performance Drivers:
  • Positive surprise attributed to a relatively low base, gradually recovering market sentiment, and satisfactory expansion of the licensing business in China.
• Business Turnaround:
  • The retail business in Hong Kong and Macau turned from loss to profit.
  • All businesses in the China market performed well.
• Near-Term Catalyst:
  • Gradual improvement and potential reopening of Hong Kong and Macau are expected to drive further growth.

Disclaimer

• This Dim Sum Daily is for general circulation and informational purposes only.
• It is not an investment research or recommendation.
• Information is based on data from recognized sources but is not independently verified.
• Kim Eng (HK) does not take responsibility for any loss due to reliance on this information.
• Opinions expressed are current and subject to change.
• Kim Eng (HK) may have financial interests in companies mentioned and may perform investment banking services for them.