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 Capital Markets

J&T Global Express  / Equity Capital Markets

<ul>
<li>In this insight, we examine <a href="https://www.smartkarma.com/entities/j-t-global-express-co-ltd" target="_blank" data-smartkarma-citation="entities:36819:1" rel="noopener">J&amp;T Global Express (1936374D CH)</a>'s operation in SE Asia, where it's the region's dominant player, with market share of 22.5% by volume </li>
<li>We profile SE Asian demand and supply and compare these to the development of China's express industry, acknowledging the key role <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba (ADR) (BABA US)</a> has played there</li>
<li>We also present a framework for estimating the value of J&amp;T's SE Asian operation by identifying the most appropriate comps and EV valuation multiples</li>
</ul>


In this insight, we examine J&amp;T Global Express (1936374D CH)'s operation in SE Asia, where it's the region's dominant player, with market share of 22.5% by volume 
We profile SE Asian demand and supply and compare these to the development of China's express industry, acknowledging the key role Alibaba (ADR) (BABA US) has played there
We also present a framework for estimating the value of J&amp;T's SE Asian operation by identifying the most appropriate comps and EV valuation multiples


J&T Global Express Pre-IPO, Part 2: SE Asia Operation | Demand, Supply Profiles | Valuation Approach

Equity Bottom-Up

<ul>
<li>ZTO Express reported another set of weak results after the US close on November 19</li>
<li>Although Q3 unit prices rose slightly, unit costs increased by much more, crushing margins</li>
<li>On both sides of the price-volume tradeoff, ZTO continues to lose profitability | AVOID</li>
</ul>


ZTO Express reported another set of weak results after the US close on November 19
Although Q3 unit prices rose slightly, unit costs increased by much more, crushing margins
On both sides of the price-volume tradeoff, ZTO continues to lose profitability | AVOID


ZTO Express Q325 Results | Revenue, ASPs Both Up Y/Y | But Earnings, Margins Both Down | AVOID

<ul>
<li>Postal parcel volume bound for the US fell -81% after exemption ended Aug 29</li>
<li>In many cases, logistics providers unwilling to manage US Customs process</li>
<li>We believe the change undermines US model used by SHEIN, Temu, AliExpress</li>
</ul>


Postal parcel volume bound for the US fell -81% after exemption ended Aug 29
In many cases, logistics providers unwilling to manage US Customs process
We believe the change undermines US model used by SHEIN, Temu, AliExpress


SHEIN / Temu / AliExpress: After US Ended "De Minimis" Exemption, Shipments to US Declined 81%

<ul>
<li>The Bad: Margins &amp; cash flow both declined sharply compared to Q224 </li>
<li>The Ugly: ZTO cut FY25 parcel volume growth target after a sluggish H1</li>
<li>With no signs of a turnaround in sight, we retain our negative view of ZTO</li>
</ul>


The Bad: Margins &amp; cash flow both declined sharply compared to Q224 
The Ugly: ZTO cut FY25 parcel volume growth target after a sluggish H1
With no signs of a turnaround in sight, we retain our negative view of ZTO


ZTO Express Q225 Results: No 'Good', Just the 'Bad' and the 'Ugly'

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/nissin-corp" target="_blank" data-smartkarma-citation="entities:12749:1" rel="noopener">Nissin Corp (9066 JP)</a> shares were up 10.3% based on a <a href="https://news.bloomberglaw.com/antitrust/japans-nissin-corp-said-to-plan-bain-backed-management-buyout" target="_blank" rel="noopener">Bloomberg report</a> that it would be privatised through a Bain-sponsored MBO. </li>
<li>The deal is expected to exceed JPY100 billion. Assuming this refers to a market cap, the implied offer price is around JPY6,500 (21.5% premium to last close).</li>
<li>While the rumoured offer represents an all-time high share price, it is light compared to precedent and peer multiples. A long-dated offer makes it susceptible to a counterbid. </li>
</ul>



Nissin Corp (9066 JP) shares were up 10.3% based on a Bloomberg report that it would be privatised through a Bain-sponsored MBO. 
The deal is expected to exceed JPY100 billion. Assuming this refers to a market cap, the implied offer price is around JPY6,500 (21.5% premium to last close).
While the rumoured offer represents an all-time high share price, it is light compared to precedent and peer multiples. A long-dated offer makes it susceptible to a counterbid. 


Nissin Corp (9066 JP): A Rumoured Bain-Sponsored MBO?

Japan

Yamato Holdings Co., Ltd. mainly provides door-to-door parcel delivery services. The Company has developed a nationwide delivery system specializing in time-specified delivery. Yamato Holdings offers moving services and other comprehensive transportation services including logistics services for both domestic and overseas customers as well as financial and autoworks services.

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Yamato Holdings (9064 JP)

J&T Global Express Pre-IPO, Part 2: SE Asia Operation | Demand, Supply Profiles | Valuation Approach

We're pulling this insight out of the archives in light of J&T's updated filing and its decision to begin pushing forward with its IPO in Hong Kong...

Tracking Traffic

ZTO Express Q325 Results | Revenue, ASPs Both Up Y/Y | But Earnings, Margins Both Down | AVOID

ZTO reported another weak set of results on Wednesday, as margins collapsed in Q3 despite modest pricing improvement. Oh, and management cut volume...

Tracking Traffic

SHEIN / Temu / AliExpress: After US Ended "De Minimis" Exemption, Shipments to US Declined 81%

The end of the US "de minimis" loophole has already decimated inbound parcel volume. It will also alter the business models used by SHEIN & Temu,...

Tracking Traffic

ZTO Express Q225 Results: No 'Good', Just the 'Bad' and the 'Ugly'

ZTO reported a weak set of results for Q225, with margins and cash flow declining sharply. Management also cut FY25 volume growth targets. We...

Tracking Traffic

Nissin Corp (9066 JP): A Rumoured Bain-Sponsored MBO?

While the rumoured offer represents an all-time high share price, it is light compared to precedent and peer multiples. A long-dated offer makes it...

Arun George

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