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China Economic Activity / China Property / Cowell E Holdings Inc / Geely Auto
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Economics | Economic Activity
July's data was weak across the board. Industrial production growth slowed to 4.5% yoy (-0.8ppt mom), missing Bloomberg's consensus estimate of 5.0% yoy, despite continued strength in high-tech manufacturing. FAI ytd growth fell further to -6.7% yoy, dragged by property FAI ytd (-19.2% yoy), with infrastructure and manufacturing FAI also now contracting. Retail sales growth slowed to 0.6% yoy, below consensus estimates of 1.5% yoy, while the unemployment rate edged up to 5.2%.
Sector Update | China Property
NBS data showed Jul 26 property investment declined 28.7% yoy, while Tier 1 new-home price momentum faded. High frequency data for 1-16 Aug 26 saw demand concentrated in Tier 1 cities, with new-home sales up 16% yoy against Tier 2's 11% drop. Beijing lagged the other Tier 1 cities in both sales and prices. Weak consumption is also weighing on the sentiment of Consumer C-REITs, which currently has an average yield of 4.3%. Maintain UNDERWEIGHT on China’s property sector.
Company Results | Cowell E Holdings Inc (1415 HK/BUY/HK$22.96/Target: HK$48.00)
Cowell's 1H26 results delivered a strong bottom line performance, driven by better-than-expected margins. Revenue stood at US$1.6b with GPM, OPM and NPM coming in at 11.2%, 6.8% and 5.6% respectively, driving net profit to US$90b which is 37.6% above consensus estimates. Maintain BUY; target price: HK$48.00.
Company Results | Geely Auto (175 HK/BUY/HK$18.67/Target: HK$29.00)
Geely’s 2Q26 adjusted net profit of Rmb5.12b (+61% yoy) beat consensus estimates by 4%, driven by ASP and margin expansion. Gross margin expanded 1.6ppt to 17.9% in 1H26, with overseas margins commanding a 10ppt premium over domestic. We raise our 2026-28 net profit forecasts by 5%/7%/9% to Rmb19.89b/Rmb27.265b/ Rmb35.09b on higher ASP and margins. Maintain BUY and raise target price to HK$29.00 target (10x 2026F PE).
Top Stories
Economics | Economic Activity
July's data was weak across the board. Industrial production growth slowed to 4.5% yoy (-0.8ppt mom), missing Bloomberg's consensus estimate of 5.0% yoy, despite continued strength in high-tech manufacturing. FAI ytd growth fell further to -6.7% yoy, dragged by property FAI ytd (-19.2% yoy), with infrastructure and manufacturing FAI also now contracting. Retail sales growth slowed to 0.6% yoy, below consensus estimates of 1.5% yoy, while the unemployment rate edged up to 5.2%.
Sector Update | China Property
NBS data showed Jul 26 property investment declined 28.7% yoy, while Tier 1 new-home price momentum faded. High frequency data for 1-16 Aug 26 saw demand concentrated in Tier 1 cities, with new-home sales up 16% yoy against Tier 2's 11% drop. Beijing lagged the other Tier 1 cities in both sales and prices. Weak consumption is also weighing on the sentiment of Consumer C-REITs, which currently has an average yield of 4.3%. Maintain UNDERWEIGHT on China’s property sector.
Company Results | Cowell E Holdings Inc (1415 HK/BUY/HK$22.96/Target: HK$48.00)
Cowell's 1H26 results delivered a strong bottom line performance, driven by better-than-expected margins. Revenue stood at US$1.6b with GPM, OPM and NPM coming in at 11.2%, 6.8% and 5.6% respectively, driving net profit to US$90b which is 37.6% above consensus estimates. Maintain BUY; target price: HK$48.00.
Company Results | Geely Auto (175 HK/BUY/HK$18.67/Target: HK$29.00)
Geely’s 2Q26 adjusted net profit of Rmb5.12b (+61% yoy) beat consensus estimates by 4%, driven by ASP and margin expansion. Gross margin expanded 1.6ppt to 17.9% in 1H26, with overseas margins commanding a 10ppt premium over domestic. We raise our 2026-28 net profit forecasts by 5%/7%/9% to Rmb19.89b/Rmb27.265b/ Rmb35.09b on higher ASP and margins. Maintain BUY and raise target price to HK$29.00 target (10x 2026F PE).
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