Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

Equity Bottom-Up

<ul>
<li>Weak travel growth getting weaker, now years out from steepest part of recovery</li>
<li>Most airlines &amp; hotel chains have benefitted little from improved travel demand</li>
<li>In recent months, appears momentum shifting back to travel intermediaries </li>
</ul>


Weak travel growth getting weaker, now years out from steepest part of recovery
Most airlines &amp; hotel chains have benefitted little from improved travel demand
In recent months, appears momentum shifting back to travel intermediaries 


Monthly Chinese Tourism Tracker | Momentum Shifts From Airlines to TCOM | September 2025

<ul>
<li>The growth of Chinese outbound activity slowed somewhat in April, to around +18-19% Y/Y</li>
<li>But domestic air activity rebounded to +8% Y/Y, the fastest monthly growth in six months</li>
<li>With strong pricing power, we still prefer China's airlines over travel platform Trip.com </li>
</ul>


The growth of Chinese outbound activity slowed somewhat in April, to around +18-19% Y/Y
But domestic air activity rebounded to +8% Y/Y, the fastest monthly growth in six months
With strong pricing power, we still prefer China's airlines over travel platform Trip.com 


Monthly Chinese Tourism Tracker | Domestic Activity Firmed in April | Airlines > TCOM (May 2025)

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>Speculations on <a href="https://www.smartkarma.com/entities/air-china-ltd-h" target="_blank" data-smartkarma-citation="entities:8239:1" rel="noopener">Air China Ltd (753 HK)</a> seeking control of <a href="https://www.smartkarma.com/entities/cathay-pacific-airways-ltd" target="_blank" data-smartkarma-citation="entities:243:1" rel="noopener">Cathay Pacific (293 HK)</a> reappeared recently. We think a change in CX's ownership is just a matter of time.</li>
<li>CX has been a more important profit contributor to Air China after the pandemic, and depends on pricing, Air China is expected to benefit from such acquisition.</li>
<li>Both are trading on 0.5SD below their 5-year P/B average and we prefer CX in the short term, but Air China looks to be a better long-term choice. </li>
</ul>


Speculations on Air China Ltd (753 HK) seeking control of Cathay Pacific (293 HK) reappeared recently. We think a change in CX's ownership is just a matter of time.
CX has been a more important profit contributor to Air China after the pandemic, and depends on pricing, Air China is expected to benefit from such acquisition.
Both are trading on 0.5SD below their 5-year P/B average and we prefer CX in the short term, but Air China looks to be a better long-term choice. 


Thematic (Sector/Industry)

<ul>
<li>Our positive calls on <a href="https://www.smartkarma.com/entities/fu-shou-yuan-international" target="_blank" data-smartkarma-citation="entities:18168:1" rel="noopener">Fu Shou Yuan (1448 HK)</a> and <a href="https://www.smartkarma.com/entities/air-china-ltd-h" target="_blank" data-smartkarma-citation="entities:8239:1" rel="noopener">Air China Ltd (753 HK)</a> and negative call on <a href="https://www.smartkarma.com/entities/china-conch-environment-protection-holdings-ltd" target="_blank" data-smartkarma-citation="entities:4827:1" rel="noopener">Conch Environment (587 HK)</a> have generated the best wins in 2022.</li>
<li>These calls achieved returns of 56.8%, 34.2% and 43.5%, respectively, which we think are remarkable given the losses of 16.3% for HSI and 19.3% for HSCEI YTD.</li>
<li>In 2023, we expect Fu Shou Yuan <a href="https://www.smartkarma.com/entities/fu-shou-yuan-international" target="_blank" data-smartkarma-citation="entities:18168:1" rel="noopener"></a>continue to do well and Conch Environment to remain under pressure. It may be prudent to take some profit on Air China. <a href="https://www.smartkarma.com/entities/air-china-ltd-h" target="_blank" data-smartkarma-citation="entities:8239:1" rel="noopener"></a> </li>
</ul>


Our positive calls on Fu Shou Yuan (1448 HK) and Air China Ltd (753 HK) and negative call on Conch Environment (587 HK) have generated the best wins in 2022.
These calls achieved returns of 56.8%, 34.2% and 43.5%, respectively, which we think are remarkable given the losses of 16.3% for HSI and 19.3% for HSCEI YTD.
In 2023, we expect Fu Shou Yuan continue to do well and Conch Environment to remain under pressure. It may be prudent to take some profit on Air China.  


Our Three Best Calls in 2022: Review and Outlook for 2023

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.</li>
<li>In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.</li>
<li>Currently, we see 6 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.</li>
</ul>


CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.
In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
Currently, we see 6 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.


Quiddity Leaderboard CSI 300/​​500 Jun25: End of Reference Period Soon; ~US$6bn Total One-Way

China

Air China Limited provides passenger, cargo, and airline-related services in China.  The Company is primarily based in Beijing and a major hub for domestic and international air transportation.  Air China's airline-related services include aircraft maintenance, repair, overhaul service, ground services, and in-flight catering services.

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Air China Ltd (A) (601111 CH)

Monthly Chinese Tourism Tracker | Momentum Shifts From Airlines to TCOM | September 2025

Chinese air travel growth continues to slow. Chinese airlines have been unable to lift margins as aircraft utilization improves, and we no longer...

Tracking Traffic

Monthly Chinese Tourism Tracker | Domestic Activity Firmed in April | Airlines > TCOM (May 2025)

The growth of Chinese domestic air travel activity in April accelerated to almost 8% after slumping to < 1% in Q125. High domestic passenger load...

Tracking Traffic

Air China (753 HK): Up Stakes in CX?

With the significant improvement in profit at Cathay Pacific in FY23 and the sustained recovery in international traffic, Air China has an even...

Osbert Tang, CFA

Our Three Best Calls in 2022: Review and Outlook for 2023

In 2023, we expect share prices of Fu Shou Yuan to continue to do well and Conch Environment to remain under pressure. For Air China, given rich...

Osbert Tang, CFA

Quiddity Leaderboard CSI 300/500 Jun25: End of Reference Period Soon; ~US$6bn Total One-Way

Collectively, for CSI 300 and CSI 500 there could be one-way flows of US$6bn during the June 2025 index rebal event. The reference period for final...

Janaghan Jeyakumar, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Monthly Chinese Tourism Tracker | Momentum Shifts From Airlines to TCOM | September 2025

Chinese air travel growth continues to slow. Chinese airlines have been unable to lift margins as aircraft utilization improves, and we no longer...

Tracking Traffic

Monthly Chinese Tourism Tracker | Domestic Activity Firmed in April | Airlines > TCOM (May 2025)

The growth of Chinese domestic air travel activity in April accelerated to almost 8% after slumping to < 1% in Q125. High domestic passenger load...

Tracking Traffic

Air China (753 HK): Up Stakes in CX?

With the significant improvement in profit at Cathay Pacific in FY23 and the sustained recovery in international traffic, Air China has an even...

Osbert Tang, CFA

Our Three Best Calls in 2022: Review and Outlook for 2023

In 2023, we expect share prices of Fu Shou Yuan to continue to do well and Conch Environment to remain under pressure. For Air China, given rich...

Osbert Tang, CFA

Quiddity Leaderboard CSI 300/​​500 Jun25: End of Reference Period Soon; ~US$6bn Total One-Way

Collectively, for CSI 300 and CSI 500 there could be one-way flows of US$6bn during the June 2025 index rebal event. The reference period for final...

Janaghan Jeyakumar, CFA

Quiddity Leaderboard CSI 300/500 Jun25: End of Reference Period Soon; ~US$6bn Total One-Way