Asia L/S Equity PM/Macro/Thematic Idea Generation

Rikki Malik

Thematic (Sector/Industry)

<ul>
<li>A big structural change to underpin consumer demand goes unnoticed</li>
<li>Efforts to prop up retail sales this year have had the desired effect</li>
<li>We change up the members of the original consumer basket</li>
</ul>


A big structural change to underpin consumer demand goes unnoticed
Efforts to prop up retail sales this year have had the desired effect
We change up the members of the original consumer basket


Low Bar, High Bounce: China’s Consumer Comeback

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>The HSI has already recovered to 2.2% above the pre-"reciprocal tariff" level, and the top 10 best-performing constituents have registered an average return of 15.6%.</li>
<li>Despite so, there are still 40 under-performing stocks, with 32 of them remain in the negative zone with an average of 4.8% loss. </li>
<li>Among them, <a href="https://www.smartkarma.com/entities/zto-express-cayman-inc" target="_blank" data-smartkarma-citation="entities:33488:1" rel="noopener">ZTO Express Cayman (2057 HK)</a>, <a href="https://www.smartkarma.com/entities/budweiser-brewing-co-apac-ltd" target="_blank" data-smartkarma-citation="entities:28077:1" rel="noopener">Budweiser Brewing APAC (1876 HK)</a>, <a href="https://www.smartkarma.com/entities/byd-electronic-international-co-ltd" target="_blank" data-smartkarma-citation="entities:1927:1" rel="noopener">BYD Electronics (285 HK)</a>, and <a href="https://www.smartkarma.com/entities/meituan" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a> look well-positioned to catch up.</li>
</ul>


The HSI has already recovered to 2.2% above the pre-"reciprocal tariff" level, and the top 10 best-performing constituents have registered an average return of 15.6%.
Despite so, there are still 40 under-performing stocks, with 32 of them remain in the negative zone with an average of 4.8% loss. 
Among them, ZTO Express Cayman (2057 HK), Budweiser Brewing APAC (1876 HK), BYD Electronics (285 HK), and Meituan (3690 HK) look well-positioned to catch up.


HK Strategy: What Are Some of the HSI Laggards to Pick Up?

Cross Asset Strategy

<ul>
<li>That “Oh sh#t moment” has just struck many investors in US markets</li>
<li>Within Hong Kong , Tech most at risk as investors take profit</li>
<li>Our alternative sector selection  has performed both absolutely and in relative terms</li>
</ul>


That “Oh sh#t moment” has just struck many investors in US markets
Within Hong Kong , Tech most at risk as investors take profit
Our alternative sector selection  has performed both absolutely and in relative terms


Investors Have that “Oh Sh#t Moment” - Part 1:  Hong Kong Strategy

<ul>
<li>One key element was the linking of consumption to the wealth effect</li>
<li>Continuation of targeted support for certain vulnerable sections of society</li>
<li>Tactical changes as well as structural ones to support consumption longer-term</li>
</ul>


One key element was the linking of consumption to the wealth effect
Continuation of targeted support for certain vulnerable sections of society
Tactical changes as well as structural ones to support consumption longer-term


China Consumption Plan: How Special Is This “Special Plan”?

<ul>
<li>Continuing review of the sectors we like for the next phase of the HK/China bull market</li>
<li>Expectations are so low that there is  a high probability of upside surprises</li>
<li>An unloved sector that will rerate on any positive catalyst</li>
</ul>


Continuing review of the sectors we like for the next phase of the HK/China bull market
Expectations are so low that there is  a high probability of upside surprises
An unloved sector that will rerate on any positive catalyst


Consumer Stocks - Waiting to Catch a Fire

China

Haidilao International Holding Ltd. is an investment holding company primarily operating a popular Chinese hot pot restaurant chain under the Haidilao brand. The company also engages in delivery services and the sale of condiment products and food ingredients. It was founded in 1994 and is headquartered in Beijing, China.

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Haidilao (6862 HK)

Low Bar, High Bounce: China’s Consumer Comeback

One of the members of our consumer basket, China Duty Free $1880, is up 16% today and 28% since we published, highlighting the asymmetric nature of...

Rikki Malik

HK Strategy: What Are Some of the HSI Laggards to Pick Up?

HSI has rebounded above pre-reciprocal tariff levels, with top stocks up 15.6%. However, 32 stocks remain negative, with ZTO Express, Budweiser...

Osbert Tang, CFA

Investors Have that “Oh Sh#t Moment” - Part 1: Hong Kong Strategy

Investors in US markets face a sudden realization, with Hong Kong Tech most vulnerable as profit-taking occurs. Our alternative sector selection...

Rikki Malik

China Consumption Plan: How Special Is This “Special Plan”?

One key new element is the linking consumption to the wealth effect, while continuing targeted support for vulnerable groups and structural changes

Rikki Malik

Consumer Stocks - Waiting to Catch a Fire

Budweiser Asia Pacific (1876.HK) is up 12% today as earnings are slightly less worse than expected and the dividend is increased. This confirms our...

Rikki Malik

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Low Bar, High Bounce: China’s Consumer Comeback

One of the members of our consumer basket, China Duty Free $1880, is up 16% today and 28% since we published, highlighting the asymmetric nature of...

Rikki Malik

HK Strategy: What Are Some of the HSI Laggards to Pick Up?

​HSI has rebounded above pre-reciprocal tariff levels, with top stocks up 15.6%. However, 32 stocks remain negative, with ZTO Express, Budweiser...

Osbert Tang, CFA

Investors Have that “Oh Sh#t Moment” - Part 1: Hong Kong Strategy

​Investors in US markets face a sudden realization, with Hong Kong Tech most vulnerable as profit-taking occurs. Our alternative sector selection...

Rikki Malik

China Consumption Plan: How Special Is This “Special Plan”?

One key new element is the linking consumption to the wealth effect, while continuing targeted support for vulnerable groups and structural changes

Rikki Malik

Consumer Stocks - Waiting to Catch a Fire

Budweiser Asia Pacific (1876.HK) is up 12% today as earnings are slightly less worse than expected and the dividend is increased. This confirms our...

Rikki Malik

HSI has rebounded above pre-reciprocal tariff levels, with top stocks up 15.6%. However, 32 stocks remain negative, with ZTO Express, Budweiser...

Investors in US markets face a sudden realization, with Hong Kong Tech most vulnerable as profit-taking occurs. Our alternative sector selection...