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.

Equity Bottom-Up

<ul><li>Undoubtedly, Proya is on track to deliver its long-term financial target stipulated in its ESOP.</li><li>On the flip side, however, this could inevitably imply growth momentum to peak-out/ fully-priced in the medium term, especially when the low hanging fruit from livestreaming is gone.</li><li>We think Proya’s multiple re-rating could take a pause from here. </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.

Undoubtedly, Proya is on track to deliver its long-term financial target stipulated in its ESOP.On the flip side, however, this could inevitably imply growth momentum to peak-out/ fully-priced in the medium term, especially when the low hanging fruit from livestreaming is gone.We think Proya’s multiple re-rating could take a pause from here. 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.

Proya Cosmetics (603605 CH) – ESOP & Mgt Sell-Off Signal Growth to Peak-Out

Thematic (Sector/Industry)

<ul><li>We expect encouraging 5.1 travel data. According to various sources and news we monitor, air passenger during the holiday is likely to surpass 9mn persons, tracking approximately 110% of the level we saw in 2019.</li><li>Splitting between domestic and overseas travellers, the former will likely grow by approximately 25%, while, for the latter, the recovery could track up to 30-40% of that in 2019.</li><li>By destination, air ticket booking to Hainan grew by 1.5x, and Hainan represented 93% of the travel destination of domestic trips.</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 expect encouraging 5.1 travel data. According to various sources and news we monitor, air passenger during the holiday is likely to surpass 9mn persons, tracking approximately 110% of the level we saw in 2019.Splitting between domestic and overseas travellers, the former will likely grow by approximately 25%, while, for the latter, the recovery could track up to 30-40% of that in 2019.By destination, air ticket booking to Hainan grew by 1.5x, and Hainan represented 93% of the travel destination of domestic trips.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 Consumer – Expecting Encouraging Data from the 5.1 Holiday This Year

<ul><li>2023 guidance maintained. During the conference call, management reiterated its 2023 growth outlook to be in line with its ESOP target at 23% YoY, with steadily improving GPM.</li><li>Of note, the plan was initiated in July last year with vesting condition stipulated to be no less than 25%/ 23%/ 22% revenue/ net profit growth YoY for 2022-24E.</li><li>This year, selling and R&amp;D expense could kick-in higher along with intensifying promotional campaigns and new launches, but such is likely to be offset by a stable administration expense ratio. Net-net, we expect a small increase in net margins.</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.

2023 guidance maintained. During the conference call, management reiterated its 2023 growth outlook to be in line with its ESOP target at 23% YoY, with steadily improving GPM.Of note, the plan was initiated in July last year with vesting condition stipulated to be no less than 25%/ 23%/ 22% revenue/ net profit growth YoY for 2022-24E.This year, selling and R&amp;D expense could kick-in higher along with intensifying promotional campaigns and new launches, but such is likely to be offset by a stable administration expense ratio. Net-net, we expect a small increase in net margins.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.

Proya Cosmetics (603605 CH) – 1Q in line; 2023 guidance maintained

<ul><li>In our last report dated 17 October, we highlighted a list of 21 long ideas.</li><li>The basket (equal weighted) of these 21 stocks underperformed MSCI China index by 5.4ppt, delivering 0.2% return (vs MSCI China 5.6%).</li><li>China Meidong Auto and Innovent Biologics delivered over 20% of return, and 4 of our 21 long ideas outperformed the benchmark.</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 our last report dated 17 October, we highlighted a list of 21 long ideas.The basket (equal weighted) of these 21 stocks underperformed MSCI China index by 5.4ppt, delivering 0.2% return (vs MSCI China 5.6%).China Meidong Auto and Innovent Biologics delivered over 20% of return, and 4 of our 21 long ideas outperformed the benchmark.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.

CMBI Research Focus List (November Edition) – Our best high conviction stock ideas

<ul><li>3Q wrapped up with 2 beats, 2 in-lines and 2 misses. We revised our 2022E earnings forecasts by -1 to -23%, and that put us roughly 5-25% below consensus.</li><li>In our view, risks are still skewed to the downside, barring any sporadic lockdowns.</li><li>When policy rhetoric is not turning, we again see grounds on the enforcement of “stay put for the holiday” for the coming CNY holiday.</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.

3Q wrapped up with 2 beats, 2 in-lines and 2 misses. We revised our 2022E earnings forecasts by -1 to -23%, and that put us roughly 5-25% below consensus.In our view, risks are still skewed to the downside, barring any sporadic lockdowns.When policy rhetoric is not turning, we again see grounds on the enforcement of “stay put for the holiday” for the coming CNY holiday.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 Consumer – Lacklustre 4Q22E Outlook Despite Any Short-Lived Rally; Top Buy CRB/ Proya/ CTGDF

China

Proya Cosmetics Co., Ltd. operates as a cosmetics products manufacturing company. The Company researches and markets skin care products, make up, body wash, and other related products. Proya Cosmetics markets its products throughout China.

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Proya Cosmetics (603605 CH)