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.

Thematic (Sector/Industry)

<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

Equity Bottom-Up

<ul><li>YAL will release its 2Q23E operating data on 19 Jul and 1H23E earnings in mid Aug.</li><li>We expect net profit to drop 12% YoY to A$1.52bn in 1H23E, as the gradual volume growth was more than offset by a decline in coal price.</li><li>We revised down our 2023E/24E earnings forecast by 27%/29%, after cutting our coal price assumptions by 15%16%. </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.

YAL will release its 2Q23E operating data on 19 Jul and 1H23E earnings in mid Aug.We expect net profit to drop 12% YoY to A$1.52bn in 1H23E, as the gradual volume growth was more than offset by a decline in coal price.We revised down our 2023E/24E earnings forecast by 27%/29%, after cutting our coal price assumptions by 15%16%. 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.

Yancoal Australia (3668 HK) – Expect Profit Decline on Weak Coal Price

<ul><li>Yancoal’s ASP of A$347/t (+35% YoY) in 1Q23 is better than our expectation, which helped mitigate the 24% YoY decline in sales volume.</li><li>We estimate Yancoal delivered ~A$2bn of revenue (+1.8% YoY). Going forward, we expect sequential improvement in production volume as the water storage issue as a result of rainfall will be gradually improved.</li><li>We have left our earnings forecast unchanged and maintain our BUY rating with NPV-based TP of HK$48. </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.

Yancoal’s ASP of A$347/t (+35% YoY) in 1Q23 is better than our expectation, which helped mitigate the 24% YoY decline in sales volume.We estimate Yancoal delivered ~A$2bn of revenue (+1.8% YoY). Going forward, we expect sequential improvement in production volume as the water storage issue as a result of rainfall will be gradually improved.We have left our earnings forecast unchanged and maintain our BUY rating with NPV-based TP of HK$48. 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.

Yancoal Australia (3668 HK) – ASP Offset the Decline in Sales Volume in 1Q23

<ul><li>We hosted NDR for Yancoal (“YAL”) in Hong Kong last week.</li><li>We saw rising investors’ interest in YAL. Key topics included dividend policy, Stock Connect, coal price expectation and cost trend.</li><li>In our view, management provided clear answers to the questions during the meetings. </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 hosted NDR for Yancoal (“YAL”) in Hong Kong last week.We saw rising investors’ interest in YAL. Key topics included dividend policy, Stock Connect, coal price expectation and cost trend.In our view, management provided clear answers to the questions during the meetings. 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.

Yancoal Australia (3668 HK) – Inclusion in Stock Connect a re-rating driver

<ul><li>YAL’s reported net profit in 2022 came in A$3.6bn, up 3.5x YoY but still 20% below our forecast.</li><li>The miss was due to a higher-than-expected unit cost and a one-off unwind of discount recognised (A$279mn) due to early repayment of debt.</li><li>Stripping out the one-off item, the net profit would be A$3.87bn (only 14% below our forecast). </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.

YAL’s reported net profit in 2022 came in A$3.6bn, up 3.5x YoY but still 20% below our forecast.The miss was due to a higher-than-expected unit cost and a one-off unwind of discount recognised (A$279mn) due to early repayment of debt.Stripping out the one-off item, the net profit would be A$3.87bn (only 14% below our forecast). 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.

Yancoal Australia (3668 HK) – Net Profit +3.5x YoY in 2022 but Below Expectations

Australia

Yancoal Australia Ltd. is a prominent Australian coal mining company engaged in the exploration, development, production, and marketing of metallurgical and thermal coal. It supplies thermal coal for electricity generation and metallurgical coal for steel manufacturing to international markets, primarily in the Asia-Pacific region. The company was founded in 2004 and is headquartered in Sydney, Australia.

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

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...

CMB International

Yancoal Australia (3668 HK) – Expect Profit Decline on Weak Coal Price

We expect net profit to drop 12% YoY to A$1.52bn in 1H23E, as the gradual volume growth was more than offset by a decline in coal price.

CMB International

Yancoal Australia (3668 HK) – ASP Offset the Decline in Sales Volume in 1Q23

Yancoal’s ASP of A$347/t (+35% YoY) in 1Q23 is better than our expectation, which helped mitigate the 24% YoY decline in sales volume.

CMB International

Yancoal Australia (3668 HK) – Inclusion in Stock Connect a re-rating driver

We saw rising investors’ interest in YAL. Key topics included dividend policy, Stock Connect, coal price expectation and cost trend.

CMB International

Yancoal Australia (3668 HK) – Net Profit +3.5x YoY in 2022 but Below Expectations

The miss was due to a higher-than-expected unit cost and a one-off unwind of discount recognised (A$279mn) due to early repayment of debt.

CMB International