External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Thematic (Sector/Industry)

<ul><li>We analysed a sample of 83 Hong Kong- and US-listed software and related technology companies (49 software and 34 related technology companies) to identify the drivers of their recent share price recovery.</li><li>By comparing revenue growth, margin changes and AI commercialisation progress, we seek to quantify AI's tangible contribution to fundamentals and assess whether software has the potential to become a new major trading theme.</li><li>Our key findings are: 1) supported by continued economic resilience, revenue growth of software companies accelerated at a broader range in 2Q26 than a year earlier, although AI's tangible contribution to fundamentals still varies across subsectors; 2) the current US software share price rebound (25 Jun to 8 Oct, same below) has been driven mainly by valuation recovery, with stronger recoveries among stocks whose fundamentals benefit from AI; and 3) among all software subsectors, infrastructure software delivered the largest revenue growth acceleration and margin improvement in 2Q26, followed by cybersecurity.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We analysed a sample of 83 Hong Kong- and US-listed software and related technology companies (49 software and 34 related technology companies) to identify the drivers of their recent share price recovery.By comparing revenue growth, margin changes and AI commercialisation progress, we seek to quantify AI's tangible contribution to fundamentals and assess whether software has the potential to become a new major trading theme.Our key findings are: 1) supported by continued economic resilience, revenue growth of software companies accelerated at a broader range in 2Q26 than a year earlier, although AI's tangible contribution to fundamentals still varies across subsectors; 2) the current US software share price rebound (25 Jun to 8 Oct, same below) has been driven mainly by valuation recovery, with stronger recoveries among stocks whose fundamentals benefit from AI; and 3) among all software subsectors, infrastructure software delivered the largest revenue growth acceleration and margin improvement in 2Q26, followed by cybersecurity.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Software & IT Services - Broad recovery, a selective opportunity

Equity Bottom-Up

JD.com Inc is an online direct sales company in China.  The Company offers a wide selection of products through its website and mobile applications.  JD.com sells appliances, computers, digital products, communication products, garments, books, and household items to consumers and vendors.

<ul><li>For 3Q26E, we expect JD.com (JD) to report total revenue of RMB308.1bn, up 3.0% YoY and broadly in line with Bloomberg consensus, and non-GAAP net profit of RMB8.0bn, up 38% YoY, driven by narrowing losses in the food delivery (FD) business.</li><li>We estimate the operating loss for the new businesses segment will narrow to RMB9.5bn in 3Q26E (2Q26: RMB9.9bn).</li><li>Within this segment, we expect the FD operating loss to narrow further QoQ to RMB5.7bn (2Q26: RMB6.1bn). </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

For 3Q26E, we expect JD.com (JD) to report total revenue of RMB308.1bn, up 3.0% YoY and broadly in line with Bloomberg consensus, and non-GAAP net profit of RMB8.0bn, up 38% YoY, driven by narrowing losses in the food delivery (FD) business.We estimate the operating loss for the new businesses segment will narrow to RMB9.5bn in 3Q26E (2Q26: RMB9.9bn).Within this segment, we expect the FD operating loss to narrow further QoQ to RMB5.7bn (2Q26: RMB6.1bn). Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

JD.com (JD US) - Short-term headwind persists

<ul><li>Tracked cosmetics e-commerce GMV (Taobao/Tmall, Douyin, JD) growth slowed to -0.6% YoY in Sep from +1.8% YoY in Aug with brand performance continuing to diverge.</li><li>Maogeping’s (1318 HK, NR) growth accelerated to +42.9% on skincare rebound, Forest Cabin (2657 HK, NR) maintained steady growth at +32.2%, and Proya returned to a broadly flat level on a low base.</li><li>Double 11 will be a test window for demand resilience and the sustainability of brand growth. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Tracked cosmetics e-commerce GMV (Taobao/Tmall, Douyin, JD) growth slowed to -0.6% YoY in Sep from +1.8% YoY in Aug with brand performance continuing to diverge.Maogeping’s (1318 HK, NR) growth accelerated to +42.9% on skincare rebound, Forest Cabin (2657 HK, NR) maintained steady growth at +32.2%, and Proya returned to a broadly flat level on a low base.Double 11 will be a test window for demand resilience and the sustainability of brand growth. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Consumer Staples - Cosmetics E-Commerce Tracker: Softer Sep Growth...

<ul><li>What’s new? China Construction Machinery Association (CCMA) released last night (12 Oct) the data for earth-moving machinery sales in Sep.</li><li>Exports of both excavators and loaders grew 21% YoY. Domestic sales of excavators grew 7% YoY, improving from ~4% growth in Jul and Aug.</li><li>Domestic sales of wheel loaders grew 14% YoY in Sep, with growth rate similar to that in Aug. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

What’s new? China Construction Machinery Association (CCMA) released last night (12 Oct) the data for earth-moving machinery sales in Sep.Exports of both excavators and loaders grew 21% YoY. Domestic sales of excavators grew 7% YoY, improving from ~4% growth in Jul and Aug.Domestic sales of wheel loaders grew 14% YoY in Sep, with growth rate similar to that in Aug. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Capital Goods - Decent Export Growth of Earth-Moving Machinery in Sep...

<ul><li>Highlights: National Day holiday spending remained modest, broadly in line with Dragon Boat Festival trends. 1) Services: Taking 3 days of leave allowed a 13-day break, encouraging long-distance travel.</li><li>County-level destinations saw strong visitor growth and longer stays.</li><li>Dining may have held up better than overall spending, while cinema and duty-free spending were weaker. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Highlights: National Day holiday spending remained modest, broadly in line with Dragon Boat Festival trends. 1) Services: Taking 3 days of leave allowed a 13-day break, encouraging long-distance travel.County-level destinations saw strong visitor growth and longer stays.Dining may have held up better than overall spending, while cinema and duty-free spending were weaker. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Consumer - Holiday spending: modest momentum, resilient services