BYD and Trip.com

Key Stock Analysis

• Trip.com (9961 HK / TCOM US): The company reported solid 2Q24 results, with net revenue up 13.6% year-on-year (YoY) to CNY 12.8 billion, driven by strong travel demand, particularly in outbound travel. Despite concerns about weak consumer sentiment in China, Trip.com continued to perform well, with significant growth in both domestic and international segments. The company’s share price fell earlier in July due to concerns over a slowdown in its domestic business, but the strong quarterly performance suggests resilience. The report maintains a “BUY” rating with an increased fair value estimate of HKD 521 / USD 67.
• BYD Co Ltd (1211 HK / 002594 CH): BYD reported a net profit of CNY 13.6 billion for 1H24, a 24% YoY increase. However, the company has been facing pressure from lower average selling prices (ASP) due to intense competition in the market. Despite these challenges, BYD remains focused on innovation, with a strong R&D team and extensive patent holdings. The company is well-positioned for industry consolidation over the next few years, with plans to grow volumes significantly. The report maintains a “BUY” rating with a fair value estimate of HKD 308 / CNY 348.

Investment Recommendations

• Sector and Stock Picks: The report includes a list of stocks sorted by market capitalization, highlighting those with strong performance and favorable recommendations. For example, DBS Group Holdings Ltd and Oversea-Chinese Banking Corp Ltd are recommended with strong buy ratings, reflecting their stable financial performance and attractive dividend yields.Thank you