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>Adjusting for impact of LNY timing, January numbers still seem firm</li>
<li>Headline February / LNY 2024 traffic growth also appears solid</li>
<li>Our thesis remains that tourism recovery takes longer, strongest in H124</li>
</ul>


Adjusting for impact of LNY timing, January numbers still seem firm
Headline February / LNY 2024 traffic growth also appears solid
Our thesis remains that tourism recovery takes longer, strongest in H124


Monthly Chinese Tourism Tracker | January & Initial Read On February Both Indicate Solid Growth

Greater China Equity Long/Short Analyst

Eric Chen

Beijing Capital International Airport (BCIA) / Equity Bottom-Up

Beijing Capital International Airport (BCIA)

<ul>
<li>Recent newsflow and company results suggest China outbound travel is on track to recover to pre-pandemic level by the end of this year.</li>
<li>China airports have different exposures to outbound travel, which largely determines the scale of their duty-free shopping business and earnings upside amidst this recovery cycle.</li>
<li>Beijing Capital Airport offers best risk/return profile among listed China airports in our view as current valuation does not fully capture even a conservative scenario of recovery in outbound travel.</li>
</ul>


Recent newsflow and company results suggest China outbound travel is on track to recover to pre-pandemic level by the end of this year.
China airports have different exposures to outbound travel, which largely determines the scale of their duty-free shopping business and earnings upside amidst this recovery cycle.
Beijing Capital Airport offers best risk/return profile among listed China airports in our view as current valuation does not fully capture even a conservative scenario of recovery in outbound travel.


China Airports: Beijing Capital Airport Offers Best Risk/Return Payoff

<ul>
<li>Trip.com reported a strong set of Q4 and FY23 earnings results last week</li>
<li>Company has held the line on SG&amp;A expenses; look for strong H124 growth</li>
<li>We believe shares are cheap and recommend investors buy below US$43/ADS</li>
</ul>


Trip.com reported a strong set of Q4 and FY23 earnings results last week
Company has held the line on SG&amp;A expenses; look for strong H124 growth
We believe shares are cheap and recommend investors buy below US$43/ADS


Trip.com Q4 Quick Take: Strong Top-Line Growth | Impressive Expense Control | And Not Expensive

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>Since early November 2023 we have been expecting global equities (MSCI ACWI) to stage a year-end rally that would continue into the early part of 2024.</li>
<li>As we progress through the “early part” of 2024, more global indexes and Sectors are breaking out and starting to participate in the upside. This is classic bull market behavior.</li>
<li>Our outlook remains bullish; continue to ride this trend higher, and treat pullbacks as buying opportunities. Actionable Themes: Hong Kong/China, Consumer Discretionary, Industrials, Energy/Coal, and Polish Banks</li>
</ul>


Since early November 2023 we have been expecting global equities (MSCI ACWI) to stage a year-end rally that would continue into the early part of 2024.
As we progress through the “early part” of 2024, more global indexes and Sectors are breaking out and starting to participate in the upside. This is classic bull market behavior.
Our outlook remains bullish; continue to ride this trend higher, and treat pullbacks as buying opportunities. Actionable Themes: Hong Kong/China, Consumer Discretionary, Industrials, Energy/Coal, and Polish Banks


Hong Kong/China Finally Bottoming?; Bullish Outlook Intact; DXY Rolling Over; Buys in Discretionary

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>
<a href="https://www.smartkarma.com/entities/trip-com-group-ltd-23a341d0-4f63-4175-a8c5-ee990906cacd" target="_blank" data-smartkarma-citation="entities:36424:1" rel="noopener">Trip.com Group (9961 HK)</a> has a remarkable 4Q23 with adjusted net profit surged 437.1% YoY. Higher volume and better market efficiency have resulted in massive margin expansion.</li>
<li>Net cash has ballooned to about 15% of its share price, and this has allowed it to carry out a massive US$300m Capital Return Program in 2024.</li>
<li>Business has outperformed the industry in CNY, with domestic hotel and air business volume increased by 60% and 50% YoY. Its overseas platform also saw double-digit growth.</li>
</ul>



Trip.com Group (9961 HK) has a remarkable 4Q23 with adjusted net profit surged 437.1% YoY. Higher volume and better market efficiency have resulted in massive margin expansion.
Net cash has ballooned to about 15% of its share price, and this has allowed it to carry out a massive US$300m Capital Return Program in 2024.
Business has outperformed the industry in CNY, with domestic hotel and air business volume increased by 60% and 50% YoY. Its overseas platform also saw double-digit growth.


Trip.com (9961 HK): Looks to Reap More Recovery Benefits

China

Trip.com Group Ltd. provides online travel agency services. The Company offers mobile applications, hotel reservations, flight ticketing, package tours, corporate travel management, and train ticketing services.

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Trip.com (TCOM US)

Monthly Chinese Tourism Tracker | January & Initial Read On February Both Indicate Solid Growth

In January 2024 Chinese travel demand continued to recover, and initial indications are that demand related to the long LNY holiday was also strong.

Tracking Traffic

China Airports: Beijing Capital Airport Offers Best Risk/Return Payoff

China outbound travel is set to recover to pre-pandemic levels by year-end, with Beijing Capital Airport offering the best risk/return profile...

Eric Chen

Trip.com Q4 Quick Take: Strong Top-Line Growth | Impressive Expense Control | And Not Expensive

Trip.com reported another strong set of quarterly results last week that featured strong top-line growth and admirable expense control. We suggest...

Tracking Traffic

Hong Kong/China Finally Bottoming?; Bullish Outlook Intact; DXY Rolling Over; Buys in Discretionary

Hong Kong/China Finally Bottoming?; Bullish Overall Outlook Intact; $DXY Rolling Over; Actionable Themes: Hong Kong/China, Consumer Discretionary,...

Vermilion Research

Trip.com (9961 HK): Looks to Reap More Recovery Benefits

Trip.com's adjusted net profit soared 437.1% YoY in 4Q23. Net cash equals 15% of its share price, enabling a US$300m 2024 Capital Return Program....

Osbert Tang, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Monthly Chinese Tourism Tracker | January & Initial Read On February Both Indicate Solid Growth

In January 2024 Chinese travel demand continued to recover, and initial indications are that demand related to the long LNY holiday was also strong.

Tracking Traffic

China Airports: Beijing Capital Airport Offers Best Risk/Return Payoff

​China outbound travel is set to recover to pre-pandemic levels by year-end, with Beijing Capital Airport offering the best risk/return profile...

Eric Chen

Trip.com Q4 Quick Take: Strong Top-Line Growth | Impressive Expense Control | And Not Expensive

Trip.com reported another strong set of quarterly results last week that featured strong top-line growth and admirable expense control. We suggest...

Tracking Traffic

Hong Kong/China Finally Bottoming?; Bullish Outlook Intact; DXY Rolling Over; Buys in Discretionary

Hong Kong/China Finally Bottoming?; Bullish Overall Outlook Intact; $DXY Rolling Over; Actionable Themes: Hong Kong/China, Consumer Discretionary,...

Vermilion Research

Trip.com (9961 HK): Looks to Reap More Recovery Benefits

​Trip.com's adjusted net profit soared 437.1% YoY in 4Q23. Net cash equals 15% of its share price, enabling a US$300m 2024 Capital Return Program....

Osbert Tang, CFA

China outbound travel is set to recover to pre-pandemic levels by year-end, with Beijing Capital Airport offering the best risk/return profile...

Trip.com's adjusted net profit soared 437.1% YoY in 4Q23. Net cash equals 15% of its share price, enabling a US$300m 2024 Capital Return Program....