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>NIO and XPEV intensified promotions during C3Q24 while LI moderated them. But we see LI possibly need to ramp up its promotion to stir up demand in C4Q24;</li>
<li>Trade-In has greatly stimulated EV demand and is possible to extend into 2025. But Huawei-affiliated PHEV makers are gaining share while Tesla is readying another round of innovation-led cost reduction;</li>
<li>Our TOP PICK's of the sector are BYD and Xiaomi. BYD benefits from PHEV and Xiaomi can still benefit from PHEV.</li>
</ul>


NIO and XPEV intensified promotions during C3Q24 while LI moderated them. But we see LI possibly need to ramp up its promotion to stir up demand in C4Q24;
Trade-In has greatly stimulated EV demand and is possible to extend into 2025. But Huawei-affiliated PHEV makers are gaining share while Tesla is readying another round of innovation-led cost reduction;
Our TOP PICK's of the sector are BYD and Xiaomi. BYD benefits from PHEV and Xiaomi can still benefit from PHEV.


Not All EV Makers Are Reaping the Rewards of Macro Stimulus

<ul>
<li>ZTO US: Parcel volume remains strong in first week of Double 11 sales(+)</li>
<li>ZTO US: New single day parcel volume record achieved at start of Double 11 (+)</li>
<li>2618 HK: Cainiao delivery integrated on the JD platform. (/)</li>
</ul>


ZTO US: Parcel volume remains strong in first week of Double 11 sales(+)
ZTO US: New single day parcel volume record achieved at start of Double 11 (+)
2618 HK: Cainiao delivery integrated on the JD platform. (/)


[Blue Lotus Daily]:ZTO/2618HK/NIU/603529CH/1585HK/MNSO/300750CH/1211HK/ZLAB/BZ/1810HK/AAPL/NIO/XPEV

<ul>
<li>LKNCY US:Weak sales of Starbucks China reflects lingering fierce competition (-)</li>
<li>300274 CH/300750 CH/1211 HK: New energy export data in September are generally weak, and the phenomenon of tariff-related advanced exporting has not yet appeared(/////)</li>
<li>AAPL US/JD US/1810 HK: iPhone achieves close to 27% market share in China during prior week (+/+/+)</li>
</ul>


LKNCY US:Weak sales of Starbucks China reflects lingering fierce competition (-)
300274 CH/300750 CH/1211 HK: New energy export data in September are generally weak, and the phenomenon of tariff-related advanced exporting has not yet appeared(/////)
AAPL US/JD US/1810 HK: iPhone achieves close to 27% market share in China during prior week (+/+/+)


[Blue Lotus Daily]:LKNCY/300274 CH/300750 CH/1211 HK/AAPL/JD /1810 HK/QCOM/2454 TT/NIO/LI/XPEV/ATAT

<ul>
<li>Real Estate Industry Update: Press Conference of the Ministry of Housing and Urban-Rural Development: Restarting Monetized Resettlement May Drive a 3%-7% Increase in Property Transactions Value(+)</li>
<li>1585 HK/NIU US/603529 CH: Shanghai announces trade-in subsidy for electric bikes (+/+/+)</li>
<li>1211HK/1810HK/XPEVUS/NIOUS/LIUS:Electric vehicle sales surged in the 41st week of 2024, BYD,Xiaomi,andXpeng took the lead, Tesla was unexpectedly weak,and Aion did not enter the top ten for the second week (/////////)</li>
</ul>


Real Estate Industry Update: Press Conference of the Ministry of Housing and Urban-Rural Development: Restarting Monetized Resettlement May Drive a 3%-7% Increase in Property Transactions Value(+)
1585 HK/NIU US/603529 CH: Shanghai announces trade-in subsidy for electric bikes (+/+/+)
1211HK/1810HK/XPEVUS/NIOUS/LIUS:Electric vehicle sales surged in the 41st week of 2024, BYD,Xiaomi,andXpeng took the lead, Tesla was unexpectedly weak,and Aion did not enter the top ten for the second week (/////////)


[Blue Lotus Daily]:1585 HK/NIU US/603529 CH/1211HK/1810 HK/XPEV US/NIO US/LI US/Real Estate Industry

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.

<ul><li>We expect 3Q24 earnings of some leading Chinese automakers including BYD, Geely and Li Auto to rise substantially from 2Q24, which could beat investors’ expectation.</li><li>We expect Great Wall’s 3Q24 earnings to be resilient and at a similar level as 2Q24. Although both Xpeng and NIO launched competitive new models in 3Q24, we do not expect their net losses to narrow QoQ as the increase in gross profits may not be able to cover the R&amp;D and SG&amp;A expenses growth.</li><li>As valuation becomes less attractive now, we prefer automakers with more solid earnings, such as Geely and Li Auto. </li></ul><p><em>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.</em></p>

We expect 3Q24 earnings of some leading Chinese automakers including BYD, Geely and Li Auto to rise substantially from 2Q24, which could beat investors’ expectation.We expect Great Wall’s 3Q24 earnings to be resilient and at a similar level as 2Q24. Although both Xpeng and NIO launched competitive new models in 3Q24, we do not expect their net losses to narrow QoQ as the increase in gross profits may not be able to cover the R&amp;D and SG&amp;A expenses growth.As valuation becomes less attractive now, we prefer automakers with more solid earnings, such as Geely and Li Auto. 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 - 3Q Earnings Preview: Leading Players to Beat

China

NIO Inc. manufactures and sells automobiles. The Company offers electric vehicles and parts, as well as provides battery charging services. NIO serves customers worldwide.

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NIO (NIO US)

Not All EV Makers Are Reaping the Rewards of Macro Stimulus

NIO and XPEV intensified promotions during C3Q24 while LI moderated them. But we see LI possibly ramping up its promotion to stir up demand in...

Blue Lotus Research Institute

[Blue Lotus Daily]:ZTO/2618HK/NIU/603529CH/1585HK/MNSO/300750CH/1211HK/ZLAB/BZ/1810HK/AAPL/NIO/XPEV

ZTO US sees strong parcel volume during Double 11 sales, while Cainiao delivery integrates with JD platform in 2618 HK.

Blue Lotus Research Institute

[Blue Lotus Daily]:LKNCY/300274 CH/300750 CH/1211 HK/AAPL/JD /1810 HK/QCOM/2454 TT/NIO/LI/XPEV/ATAT

Starbucks China sales struggle amid intense competition, new energy export data weak, iPhone gains 27% market share in China.

Blue Lotus Research Institute

[Blue Lotus Daily]:1585 HK/NIU US/603529 CH/1211HK/1810 HK/XPEV US/NIO US/LI US/Real Estate Industry

Government initiatives like monetized resettlement and trade-in subsidies are driving growth in the real estate and electric vehicle industries,...

Blue Lotus Research Institute

Auto - 3Q Earnings Preview: Leading Players to Beat

We expect 3Q24 earnings of some leading Chinese automakers including BYD, Geely and Li Auto to rise substantially from 2Q24, which could beat...

CMB International

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Not All EV Makers Are Reaping the Rewards of Macro Stimulus

NIO and XPEV intensified promotions during C3Q24 while LI moderated them. But we see LI possibly ramping up its promotion to stir up demand in...

Blue Lotus Research Institute

[Blue Lotus Daily]:ZTO/2618HK/NIU/603529CH/1585HK/MNSO/300750CH/1211HK/ZLAB/BZ/1810HK/AAPL/NIO/XPEV

​ZTO US sees strong parcel volume during Double 11 sales, while Cainiao delivery integrates with JD platform in 2618 HK.

Blue Lotus Research Institute

[Blue Lotus Daily]:LKNCY/300274 CH/300750 CH/1211 HK/AAPL/JD /1810 HK/QCOM/2454 TT/NIO/LI/XPEV/ATAT

​Starbucks China sales struggle amid intense competition, new energy export data weak, iPhone gains 27% market share in China.

Blue Lotus Research Institute

[Blue Lotus Daily]:1585 HK/NIU US/603529 CH/1211HK/1810 HK/XPEV US/NIO US/LI US/Real Estate Industry

​Government initiatives like monetized resettlement and trade-in subsidies are driving growth in the real estate and electric vehicle industries,...

Blue Lotus Research Institute

Auto - 3Q Earnings Preview: Leading Players to Beat

We expect 3Q24 earnings of some leading Chinese automakers including BYD, Geely and Li Auto to rise substantially from 2Q24, which could beat...

CMB International

ZTO US sees strong parcel volume during Double 11 sales, while Cainiao delivery integrates with JD platform in 2618 HK.

Starbucks China sales struggle amid intense competition, new energy export data weak, iPhone gains 27% market share in China.

Government initiatives like monetized resettlement and trade-in subsidies are driving growth in the real estate and electric vehicle industries,...