Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-meidong-auto-holdings-limited" target="_blank" data-smartkarma-citation="entities:10795:1" rel="noopener">China MeiDong Auto (1268 HK)</a> presents an excellent investment opportunity, trading at 13.3x/8.1x FY22/23e, post street estimate revisions downwards with a dividend yield of 6.0%/10% (assuming an 80% payout). </li>
<li>China MeiDong Auto (1268 HK) 's integration of Starchase is progressing better than we expected, with metrics on inventory dramatically improving. We believe the management will focus on aftersales now. </li>
<li>The company will join the EV bandwagon by collaborating on aftersales with players having operational (not financial) difficulties performing this service, presenting a good opportunity for the company. </li>
</ul>



China MeiDong Auto (1268 HK) presents an excellent investment opportunity, trading at 13.3x/8.1x FY22/23e, post street estimate revisions downwards with a dividend yield of 6.0%/10% (assuming an 80% payout). 
China MeiDong Auto (1268 HK) 's integration of Starchase is progressing better than we expected, with metrics on inventory dramatically improving. We believe the management will focus on aftersales now. 
The company will join the EV bandwagon by collaborating on aftersales with players having operational (not financial) difficulties performing this service, presenting a good opportunity for the company. 


Meidong: Insights from Call with the Management for H1 2022

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>China’s passenger-vehicle (PV) retail sales volume fell 1% YoY in first four months of 2023, 2% higher than our forecast made in Dec 2022.</li><li>Wholesale volume also rose 7% YoY YTD, 3% higher than our prior forecast, largely due to doubled PV exports in the first four months of 2023.</li><li>Automakers in China started to cut inventories in Apr 2023, as we had expected.</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.

China’s passenger-vehicle (PV) retail sales volume fell 1% YoY in first four months of 2023, 2% higher than our forecast made in Dec 2022.Wholesale volume also rose 7% YoY YTD, 3% higher than our prior forecast, largely due to doubled PV exports in the first four months of 2023.Automakers in China started to cut inventories in Apr 2023, as we had expected.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.

China Auto Sector – Mixed picture ahead as inventory risk lingers

<ul><li>In this report, we summarize the Mar 2025 price discounts at dealers for major automakers.</li><li>Note that Mar discounts for each automaker are calculated based on the weighted average of Feb 2025 retail sales volume for each model, as Mar 2025 retail sales volume data have not been released yet.</li><li>The industrywide average discounts narrowed by 0.1ppts MoM in Mar 2025, based on our calculations, thanks to the narrowing discounts from some German brands (VW, Audi). </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.

In this report, we summarize the Mar 2025 price discounts at dealers for major automakers.Note that Mar discounts for each automaker are calculated based on the weighted average of Feb 2025 retail sales volume for each model, as Mar 2025 retail sales volume data have not been released yet.The industrywide average discounts narrowed by 0.1ppts MoM in Mar 2025, based on our calculations, thanks to the narrowing discounts from some German brands (VW, Audi). 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.

Auto - 1Q25 Sales Volume, Discounts May Lead to Larger Earnings Divergence

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

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<li>There are 29 adds and 41 deletes for the Hang Seng Composite Index (HSCI) at the March rebalance to take the number of index constituents down to 505.</li>
<li>We expect 27 of the 29 HSCI inclusions to be added to Stock Connect from the open on 10 March while <a href="https://www.smartkarma.com/entities/horizon-robotics-inc" target="_blank" data-smartkarma-citation="entities:35637:1" rel="noopener">Horizon Robotics (9660 HK)</a> should be added in May.</li>
<li>We expect 28 of the 41 HSCI deletions will be removed from Stock Connect and there has been increased Southbound holding in a lot of the stock this calendar year.</li>
</ul>


There are 29 adds and 41 deletes for the Hang Seng Composite Index (HSCI) at the March rebalance to take the number of index constituents down to 505.
We expect 27 of the 29 HSCI inclusions to be added to Stock Connect from the open on 10 March while Horizon Robotics (9660 HK) should be added in May.
We expect 28 of the 41 HSCI deletions will be removed from Stock Connect and there has been increased Southbound holding in a lot of the stock this calendar year.


HSCI Index Rebalance: 29 Adds, 41 Deletes & Changes to Southbound Stock Connect

<ul><li>We summarize the Jan 2025 price discounts at dealers for major automakers in this report.</li><li>Note that Jan discounts for each automaker are calculated based on the weighted average of Dec 2024 retail sales volume for each model, as Jan 2025 retail sales volume data have not been released yet.</li><li>The industrywide average discounts widened by 0.3ppts MoM in Jan 2025, based on our calculations, mainly driven by Chinese automakers, including BYD, Leapmotor and GAC Aion, and German brands, such as BMW and Audi. BYD plans to cover the majority of its models with autonomous driving (AD) functions this year, which may have resulted in higher discounts for its existing models. </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 summarize the Jan 2025 price discounts at dealers for major automakers in this report.Note that Jan discounts for each automaker are calculated based on the weighted average of Dec 2024 retail sales volume for each model, as Jan 2025 retail sales volume data have not been released yet.The industrywide average discounts widened by 0.3ppts MoM in Jan 2025, based on our calculations, mainly driven by Chinese automakers, including BYD, Leapmotor and GAC Aion, and German brands, such as BMW and Audi. BYD plans to cover the majority of its models with autonomous driving (AD) functions this year, which may have resulted in higher discounts for its existing models. 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.

Auto - Leap, BYD, Aion Led Discount Increase in Jan

China

China Yongda Automobiles Services Holdings Ltd. retails passenger vehicles. The Company sells new and used vehicles and offers automobile rentals. China Yongda Automobiles also provides service.

China Yongda Automobile Services Hldg (3669 HK)

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China Yongda Automobile Services Hldg (3669 HK)

Meidong: Insights from Call with the Management for H1 2022

China MeiDong Auto presents an excellent investment opportunity, trading at 13.3x/8.1x FY22/23e, post street estimate revisions downwards with a...

Sameer Taneja

China Auto Sector – Mixed picture ahead as inventory risk lingers

China’s passenger-vehicle (PV) retail sales volume fell 1% YoY in first four months of 2023, 2% higher than our forecast made in Dec 2022.

CMB International

Auto - 1Q25 Sales Volume, Discounts May Lead to Larger Earnings Divergence

Note that Mar discounts for each automaker are calculated based on the weighted average of Feb 2025 retail sales volume for each model

CMB International

HSCI Index Rebalance: 29 Adds, 41 Deletes & Changes to Southbound Stock Connect

There are 29 adds/ 41 deletes for the HSCI in March. We expect 27 inclusions and 28 deletions for Southbound Stock Connect. There are big holdings...

Brian Freitas

Auto - Leap, BYD, Aion Led Discount Increase in Jan

Note that Jan discounts for each automaker are calculated based on the weighted average of Dec 2024 retail sales volume for each model, as Jan 2025...

CMB International

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)