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>January air cargo activity moderated; timing of LNY holiday also made for tough comps</li>
<li>January Int'l air cargo tons at US gateways grew far less than inbound (ocean) TEUs</li>
<li>Data from Asian carriers &amp; US gateways indicates low utilization, softening growth</li>
</ul>


January air cargo activity moderated; timing of LNY holiday also made for tough comps
January Int'l air cargo tons at US gateways grew far less than inbound (ocean) TEUs
Data from Asian carriers &amp; US gateways indicates low utilization, softening growth


Monthly Air Cargo Tracker | January: Soft Demand, Low LFs | Ocean Growth > Air Growth (March 2025)

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

<ul>
<li>
<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> will be added to the <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">Hang Seng China Enterprises Index (HSCEI INDEX)</a> next week and to a global index couple of weeks after that.</li>
<li>Despite passives needing to buy more than 5% of float inside a month, the stock has barely budged in a rallying China market.</li>
<li>The increase in cumulative excess volume has been very gradual, indicative of low positioning in the stock. With a lot to buy over the next few weeks, that could change.</li>
</ul>



ZTO Express Cayman (2057 HK) will be added to the Hang Seng China Enterprises Index (HSCEI INDEX) next week and to a global index couple of weeks after that.
Despite passives needing to buy more than 5% of float inside a month, the stock has barely budged in a rallying China market.
The increase in cumulative excess volume has been very gradual, indicative of low positioning in the stock. With a lot to buy over the next few weeks, that could change.


ZTO Express (2057 HK): Not Delivering Despite Double Index Inclusion

Cainiao Smart Logistics Network / Equity Bottom-Up

Cainiao Smart Logistics Network (1437124D HK)

<ul>
<li>In the December quarter, CaiNiao's revenue declined -1% Y/Y; EBITA margin fell, too</li>
<li>CaiNiao's revenue growth has de-coupled from the growth of Alibaba's international segment</li>
<li>We believe price pressure on Chinese X-border logistics exceeds pressure within X-border retail
</li>
</ul>


In the December quarter, CaiNiao's revenue declined -1% Y/Y; EBITA margin fell, too
CaiNiao's revenue growth has de-coupled from the growth of Alibaba's international segment
We believe price pressure on Chinese X-border logistics exceeds pressure within X-border retail



CaiNiao Q3FY: Revenue Declines Y/Y, Margins, Too | X-Border Logistics Pricing Under Intense Pressure

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/dada-nexus-ltd" target="_blank" data-smartkarma-citation="entities:28961:1" rel="noopener">Dada Nexus (DADA US)</a> disclosed a non-binding proposal from <a href="https://www.smartkarma.com/entities/jd-com-inc-adr" target="_blank" data-smartkarma-citation="entities:446:1" rel="noopener">JD.com Inc (ADR) (JD US)</a> at US$2.00 per ADS, a 41.8% premium to the undisturbed price of US$1.41 (24 January).</li>
<li>The offer is light compared to the IPO price (US$16.00), average sell-side price targets (US$2.19) and historical trading ranges. </li>
<li>The shareholder vote is low-risk (two-thirds voting threshold), as JD.com represents 63.2% of the voting power. The key risk is the timing of a binding proposal. </li>
</ul>



Dada Nexus (DADA US) disclosed a non-binding proposal from JD.com Inc (ADR) (JD US) at US$2.00 per ADS, a 41.8% premium to the undisturbed price of US$1.41 (24 January).
The offer is light compared to the IPO price (US$16.00), average sell-side price targets (US$2.19) and historical trading ranges. 
The shareholder vote is low-risk (two-thirds voting threshold), as JD.com represents 63.2% of the voting power. The key risk is the timing of a binding proposal. 


Dada Nexus (DADA US): JD.com’s Light Non-Binding Offer at US$2 Per ADS

<ul>
<li>With improved liquidity, <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> could be added to the <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI INDEX</a> early March and then to a global index a couple of weeks later.</li>
<li>
<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> is a lower probability inclusion to the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">Hang Seng Index (HSI INDEX)</a> given the index committee discretion. Inclusion would further increase the impact.</li>
<li>The stock has had a big drawdown recently and the potential index inclusion and passive demand provide a low-risk entry point into the stock, especially hedged with its peers.</li>
</ul>


With improved liquidity, ZTO Express Cayman (2057 HK) could be added to the HSCEI INDEX early March and then to a global index a couple of weeks later.

ZTO Express Cayman (2057 HK) is a lower probability inclusion to the Hang Seng Index (HSI INDEX) given the index committee discretion. Inclusion would further increase the impact.
The stock has had a big drawdown recently and the potential index inclusion and passive demand provide a low-risk entry point into the stock, especially hedged with its peers.


ZTO Express (2057 HK): On Track for Double (Maybe Triple) Index Inclusion

China

JD Logistics is a technology-driven supply chain solutions and logistics services provider, offering warehousing, distribution, and express and freight delivery. It serves various industries including fast-moving consumer goods, apparel, and automotive. The company is headquartered in Beijing, China, and was founded in 2007.

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JD Logistics (2618 HK)

Monthly Air Cargo Tracker | January: Soft Demand, Low LFs | Ocean Growth > Air Growth (March 2025)

Air cargo demand in January 2025 softened, although some of this may be attributed to timing of the LNY holiday. Air cargo utilization is low (and...

Tracking Traffic

ZTO Express (2057 HK): Not Delivering Despite Double Index Inclusion

ZTO Express is an inclusion to the HSCEI and a global index. Passive trackers will buy over 5% of float. Short interest has jumped, and the stock...

Brian Freitas

CaiNiao Q3FY: Revenue Declines Y/Y, Margins, Too | X-Border Logistics Pricing Under Intense Pressure

Alibaba's latest quarterly earnings release shows that X-border logistics pricing and the pricing of X-border retail itself both remain under...

Tracking Traffic

Dada Nexus (DADA US): JD.com’s Light Non-Binding Offer at US$2 Per ADS

The offer is light but the vote is low-risk (two-thirds voting threshold), as JD.com represents 63.2% of the voting power. The key risk is the...

Arun George

ZTO Express (2057 HK): On Track for Double (Maybe Triple) Index Inclusion

There should be 2, possibly 3, index inclusions for ZTO Express in March. There will be a lot to buy from passives and the stock has underperformed...

Brian Freitas

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