Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Thematic (Sector/Industry)

<ul>
<li>300274 SZ: Sungrow preannounced full-year profit to exceed expectations (+)</li>
<li>LI/NIO/XPEV: Li Auto's deliveries rose in the third week of January, ranking first among new forces, but still lower than expected (-)</li>
<li>BEKE: Chongqing raised the levy standard of property tax (+)</li>
</ul>


300274 SZ: Sungrow preannounced full-year profit to exceed expectations (+)
LI/NIO/XPEV: Li Auto's deliveries rose in the third week of January, ranking first among new forces, but still lower than expected (-)
BEKE: Chongqing raised the levy standard of property tax (+)


[Blue Lotus Daily]: ATAT/HTHT/TCOM/300750CH/1211HK/835185CH/ 600516CH/LI/NIO/XPEV/BEKE/ZTO

Equity Bottom-Up

<ul>
<li>A new draft measure suggested Shenzhen is planning to accelerate its shantytown renovation and offer more Affordable Houses to meet demand of low-income groups, mimicking Singapore’s HDB flat policy.</li>
<li>As China’s property market gradually heading to the Singapore model, we expect the existing home market to enlarge and new home market to shrink.</li>
<li>We expect Beike existing home business and renovation business to benefit, while new home business hurts. We maintained the stock as BUY rating and TP at US$24.5/ADS.</li>
</ul>


A new draft measure suggested Shenzhen is planning to accelerate its shantytown renovation and offer more Affordable Houses to meet demand of low-income groups, mimicking Singapore’s HDB flat policy.
As China’s property market gradually heading to the Singapore model, we expect the existing home market to enlarge and new home market to shrink.
We expect Beike existing home business and renovation business to benefit, while new home business hurts. We maintained the stock as BUY rating and TP at US$24.5/ADS.


[KE Holdings(BEKE US, BUY, TP US$24.5) Update]: Singaporization of Real Estate Has LT Plus, ST Minus

<ul>
<li>Beijing and Shanghai laid out long waited stimulus policies on property market, include 1) lower property down payments ratio;2) lower mortgage loan rate;</li>
<li>3) lower recognition standard for ordinary home. The key is to encourage households to add leverage.</li>
<li>We treat the financial stimulus as one-off positive shock to the home transaction markets in the two cities,  especially benefiting 1Q24 sales for Beike due to...</li>
</ul>


Beijing and Shanghai laid out long waited stimulus policies on property market, include 1) lower property down payments ratio;2) lower mortgage loan rate;
3) lower recognition standard for ordinary home. The key is to encourage households to add leverage.
We treat the financial stimulus as one-off positive shock to the home transaction markets in the two cities,  especially benefiting 1Q24 sales for Beike due to...


[KE Holdings Inc. (BEKE US, BUY, TP US$24.5) TP Change]: Policy Stimulus Drive up near Term Sales

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

<ul>
<li>We prepared high beta and low risk recommendations for 2024:</li>
<li>With 2024 YE as horizon, we recommend JD.com, JD Logistics, JDHealth, Tencent and Luckin.</li>
<li>With 1H24 as horizon, we recommend KE Holdings, NetEase and Kuaishou.</li>
</ul>


We prepared high beta and low risk recommendations for 2024:
With 2024 YE as horizon, we recommend JD.com, JD Logistics, JDHealth, Tencent and Luckin.
With 1H24 as horizon, we recommend KE Holdings, NetEase and Kuaishou.


2024 High Conviction Idea - High Beta and Low Risk Recommendations

<ul>
<li>In our view, China growth equity faces high geopolitical uncertainty in C3Q24 ahead of the US election, but can experience a relief rally in C1Q24.</li>
<li>We prepared high beta and low risk recommendations for 2024</li>
<li>For low-risk, we recommend JD/JDL/JDH, Tencent and Luckin. For high beta, we recommend BEKE, LI Auto and Kuaishou.</li>
</ul>


In our view, China growth equity faces high geopolitical uncertainty in C3Q24 ahead of the US election, but can experience a relief rally in C1Q24.
We prepared high beta and low risk recommendations for 2024
For low-risk, we recommend JD/JDL/JDH, Tencent and Luckin. For high beta, we recommend BEKE, LI Auto and Kuaishou.


[Blue Lotus Sector Update]: 2024 High Conviction Idea: Two Scenarios Towards Year End

China

KE Holdings Inc. operates as an integrated online and offline platform for housing transactions and services. The Company offers existing and new home sales, home rentals, home renovation, real estate financial solutions, and other services. KE Holdings conducts businesses in China.

Price Gauge
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KE Holdings (BEKE US)

[Blue Lotus Daily]: ATAT/HTHT/TCOM/300750CH/1211HK/835185CH/ 600516CH/LI/NIO/XPEV/BEKE/ZTO

Sungrow's full-year profit exceeds expectations; Li Auto's deliveries improve but fall short; Chongqing raises property tax levy standard.

Blue Lotus Research Institute