研究报告全文：21Mar2023CMBInternationalGlobalMarketsEquityResearchEconomicsPerspectiveChinaMacroMonitorUnderwaytorecoverEconomyForecastChinaseconomycontinuedtorecoverinMarchwithBingnanYEPhDconstructionfactoryactivityandfreightflowimprovingandtrafficpassenger85237618967flowmildlysofteningWemaintainourforecastonChinasGDPgrowthat38yebingnancmbicomhkfor1Q23and54for2023ChinasreflationpressureremainedlowastheCPIgrowthmaybearound1inMarch-AprilwhilethePPImayfurtherKevinZhangdecline2-25innextthreemonthsAmideasingcreditpolicythegrowth85253364682ofrenminbiloansmaycontinuetoreboundkevinzhangcmbicomhkFreightPassengerFlowRailwayfreightandportcontainerthroughputcontinuedtoimproveindicatingfurtherimprovementofindustrialoutputand20222023FshippingactivityThenumberofexpresspackagesalsopickedupHoweverDecJan-FebMarinner-citypassengerflowandtrafficcongestionindexmildlydeclinedasGDPYoYquarterly29-38VAIOYoY132428relatedserviceactivitymayhavesoftenedServiceindexYoY085558RetailsalesYoY183526HousingMarketAutoSalesandConstructionActivityChinashousingFAIYoYYTD515547saleshadabetter-than-expectedrecoveryinMarchduetoaccommodativeExportsofgoodsYoY10068100creditpolicyconfidenceimprovementaftereconomicreopeningandareleaseImportsofgoodsYoY7510240CPIYoY181519ofpotentialdemanddelayedbylockdownslastyearAutosalesdroppedasPPIYoY071120consumerswaitedforbetterpricesintheproducerspricewarConstructionRMBloansYoY111116118activitycontinuedtoimproveasinfrastructureinvestmentmayhaveremainedM2YoY118129127strongandpropertydevelopmentinvestmentmayhavefurtherimprovedSocialfinancingRmbtrn139155NewRMBloansRmbtrn146740ChinaExportsandUSRecessionRiskChinasexportsofgoodsmayhave3MShibor24224425010YT-bondrate284292286remainedweakwithmildimprovementinMarchTherecentturmoilinglobalSourceWindCMBIGMmarketspointedtohigherrecessionriskforoverseaseconomyaheadTherecessionwiththedisinflationindicatesChinaexportsmayremainweakinnexttwoquartersWeexpectChinaexportsofgoodstodrop35YoYin2023ChinasLiquidityConditionRMBExchangeRatesMoneymarketratesincreasedinthepastthreemonthsasliquiditydemandreboundedalongwithcreditexpansionandeconomicrecoveryTheRRRcutindicatesthePBOCseasingbiasforliquidityandcreditpolicytoboostthegrowthTreasurybondratesmildlydeclinedinMarchaftermoderateincreasesfromearlyNovemberRenminbidepreciatedagainstUSdollarinthefirsthalfofMarchastheUSdollarindexrosethankstobetter-than-expectedeconomicdataandtheriskaversionsentimentduringtherecentglobalfinancialmarketturmoilRenminbimaymoderatelyreboundagainstUSdollarin2H23aftertheUSeconomyseesarecessionWemaintainourforecastonUSRMBspotrateat660atend-2023PLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1MOREREPORTSFROMBLOOMBERGRESPCMBRGOORhttpwwwcmbicomhk21Mar2023Figure1ChinaEconomyForecastSourceWindCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE221Mar2023ChinaEconomyForecastGDPgrowthratesareexpectedtoreach387746and56respectivelyforthefourquartersChinaseconomycontinuedtorecoverwithconstructionfactoryactivityimprovingandtrafficpassengerflowmildlysofteninginMarchTheeconomicresumptionwasbasicallyinlinewithexpectationsin1Q23WemaintainourforecastontheGDPgrowthat54for2023InflationshouldremainweakinMar-AprbeforegraduallyreboundingfromMayTheporksupplycycleandrecentglobalmarketsturmoilshouldoutweightheeffectofeconomicreopeningonChinasinflationWeexpecttheCPIgrowthtoremainaround1inMarch-AprilandthePPItofurtherdrop25-3innextthreemonthsAsdomesticdemandcontinuestoresumeinflationmaygraduallypickupin2H23TheCPIandPPIgrowthratesareexpectedtorespectivelyreach22and-05in2023CreditgrowthmaycontinuetoreboundamideasingcreditpolicyTherecentRRRcutshowsthePBOCscommitmenttoeasingcreditpolicyBanksareguidedtoexpandtheircreditsupplytotherealsectorespeciallytomanufacturingserviceandSMEsTheYoYgrowthofrenminbiloansandoutstandingsocialfinancingmaygraduallyreboundHoweverM2growthmaymitigateasriskaversionsentimentdropsFigure2ChinasEconomicActivityIndexFigure3ChinasCPIPPIGrowthForecastYoY161412108642024620192020202120222023CPIPPISourceWINDCMBIGMSourceWINDCMBIGMFigure4ChinasCPIGrowthPredictedbyAIFigure5ChinasPPIGrowthPredictedbyAIYoYYoYYoY620143512151024831061241520000211425622020202120222023201801201901202001202101202201202301CPILHSCoreCPILHSFoodCPIRHSPPILHSResidentialCPIRHSSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE321Mar2023FreightPassengerFlowinChinaFreightflowChinasfreightflowcontinuedtoresumeindicatingtheeconomyisunderwaytorecoverRailwayfreighttrafficandportcontainerthroughputcontinuedtoriseby43and103YoYrespectivelyinthefirst17daysofMarchafterincreasingby20and79YoYinFebruaryMeanwhilethenumberofexpresspackagesjumped193afterrising46YoYin2M23FlightsThenumberofdomesticflightsreturnedtoclosetoanormallevelwhilethatofinternationalflightscontinuedtoreboundafterChinaremoveditscross-borderrestrictionsBothoutboundandinboundtourismareexpectedtorecoverinagradualmannerInner-citytrafficflowTrafficflowmildlysoftenedinMarchasthegrowthofrelatedserviceactivitymayhavealsodeclinedIn9of40citiestrafficcongestionindexfurtherpickedupIntheremaining31citieshoweverthegrowthoftrafficcongestionindexsoftenedinMarchInmostcitiessubwaypassengerflowpeakedinearlyMarchandretreatedinthepasttwoweeksMoviemarketRecreationdemandofyoungconsumerscontinuedtorecoverMoviemarketsignificantlyimprovedwiththenumberoffilmaudienceup584YoYinthefirst19daysofMarchafterdropping658YoYinFebruaryFigure6ChinasRailwayFreightTrafficPortFigure7DailyNumberofFlightsContainerThroughputYoY7DMA7DMA3018000600160002550014000201200040015100003001080005600020040000100200050010152021-042021-072021-102022-012022-042022-072022-102023-0120192021202220232020NumberofdomesticflightsLHSRailwayfreighttrafficPortcontainerthroughputNumberofinternationalflightsRHSSourceWINDCMBIGMSourceWINDCMBIGMFigure8NumberofExpressPackagesFigure9DailyNumberofMovieAudienceYoY2YCAGRfor2M21million7DMA60255020403015201010051020007100102030405060809111220192020202120222023Numberofexpresspackages2019Y2022Y2023YSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE421Mar2023Figure10ChinasTrafficCongestionIndexFebMar202350YoY40302010010XianHefeiJinanErdosDalianSanyaHarbinTianjinBeijingZhuhaiHaikouWuhanNingboUrumqiFuzhouFoshanNanjingSuzhouXiamenTaiyuanNanningGuiyangQingdaoLanzhouKunmingChengduShanghaiWenzhouchangshaShenzhenShenyangNanchangHangzhouDongguanChongqingHongKongZhengzhouChangchunGuangzhouMar2023ShijiazhuangFeb2023SourceWINDCMBIGMFigure11SubwayPassengerFlowWeeklyAveragemilliondaymillionday1281076856443221002019202020212022202320212019202020222023BeijingShanghaiGuangzhouShenzhenChengduWuhanSourceWINDCMBIGMSourceWINDCMBIGMmilliondaymillionday3042532021510105000202020212022202320192020202120222023ChongqingNanjingZhengzhouSuzhouChangshaXiamenSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE521Mar2023HousingMarketAutoSalesConstructionActivityinChinaChinashousingsaleshadabetter-than-expectedrecoveryinbothFebruaryandMarchduetoaccommodativecreditpolicyandreleaseofpostponeddemandbythelockdownsHousingsalesintier-1andtier-23citiesfurthergrew437and221YoYrespectivelyinthefirsthalfofMarchafterrising133and398YoYrespectivelyinFebruarySecond-handhousingsalesalsocontinuedtoresumeinMarchListingpricesofsecond-handhousesintier-1citiessawareboundwhilethepricesintier-2andbelowcitiesweremuchweakerThereleaseofpostponeddemandbythelockdownslastyearwillcontinuetosupporthousingsalesrecoveryin1H23Howevertheremaybesomefluctuationsintherecoverypacein2H23PassengervehiclessalesdroppedasconsumerswaitforbetterpricesintheautopricewarAccordingtoChinaPassengerCarAssociationautosalesdropped17YoYinthefirsthalfofMarchafterrising195YoYinFebruarySomeconsumerschosetowaitforbetterpricesintherecentautopricewarSecond-handautosalescontinuedtoimprovewithadeclineofaveragesalespricesinMarchConstructionactivitycontinuedtoimproveasinfrastructureinvestmentmayhavebeenstrongCapacityoperationrateofdeformedsteelbarandasphaltplantbothreboundedsignificantlyinthefirsthalfofMarchConstructionmaterialpricessuchasflatglassandPVCmildlypickedupCementsinventorytostoragecapacityratiodroppedwithanincreaseincementpricesinthepastseveralweeksFigure12YoYGrowthofCommodityBuildingSalesFigure13ChinasHousingSalesYoY2YCAGRfor2021ThousandsDailyAverage9087075063051041033025017001474952131619222528313437404346201720182019202020212022202310Tier1citiesTier23cities2023Y2022Y2019YSourceWINDCMBIGMSourceWINDCMBIGMFigure14ChinasSecond-handHousingSalesFigure15ListingPriceIndexofSecond-handHouseThousandsDailyAverageindex825072302106190517041503130211019020172018201920202021202220230174Tier1citiesTier2cities1319253110162228343740434649522023Y2022Y2019YTier3citiesTier4citiesSourceWINDCMBIGMSourceWINDCMBIGMNote10citiesincludeBeijingShanghaiGuangzhouShenzhenHangzhouNanjingQingdaoSuzhouNanchangXiamenPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE621Mar2023Figure16AutoSalesVolumeFigure17Second-handAutoSalesVolumeYoYnumberRmbth50803410120115307029101011060241010510501910100309540501410907030910859020804102017201820192020202120222023759070PassengervehiclesalesLHS20192020202120222023Capacityoperationrateofsemi-steeltyreRHSSalesvolumeLHSASPRHSSourceWINDCMBIGMSourceWINDCMBIGMFigure18CapacityOperationRatesFigure19CommoditiesPricesRmbtonRmbton90700015008060001300705000110060400090050300070040200050030100030020201420162017201820192020202120222023201620172018201920202021202220232015DeformedsteelbarAsphaltplanDeformedsteelbarLHSIronoreRHSSourceWINDCMBIGMSourceWINDCMBIGMFigure20CementInventorytoStorageCapacityFigure21FlatGlassandPVCPricesRatioCementPriceRmbtonRmbtonIndex35401410075220131003040702001210011100652540180101006016020409100558100140154050710061004512010405100401005404100201820192020202120222023CementinventorytostoragecapacityratioLHS2017201420152016201820192020202120222023CementpriceRHSFlatglassLHSPVCRHSSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE721Mar2023ChinaExportsandUSRecessionRiskChinasexportsmayhaveremainedweakwithmildimprovementinMarchChinasexportsofgoodsdropped13YoYinFebruaryafterdecreasing105YoYinJanuaryChinastradewithSouthKoreashowedsomeimprovementinMarchHowevertherecentturmoilinglobalmarketsindicatedhigherrecessionriskforoverseaseconomythisyearWeexpectChinasexportsofgoodsmayhaveremainedweakwithsomemildimprovementinMarchWeexpecttheexportstodrop76and3YoYinthefirstthreequartersandtorise2YoYinthelastquarterUSleadingindicatorssentfurtherwarningsignalsforarecessionaheadUSretailsalesdeclinedforthepreviousthreemonthsashouseholdspulledbackontheirspendingUSCPIinFebruarywasin-linewithexpectationsbutitscoreCPIwasstillaboveestimatesduetohighhousingcostswhileUSPPIinFebruaryincreased459YoYBoth10Y3Mand10Y2YTreasuryyieldcurvesremainedinvertedindicatingtherecessionriskisstillthereUShousingmarketshowedweaknessindemandas30YmortgageratesclimbedalongwithFedsinterestratehikesMortgageapplicationshaveretreatedagainasaresultofhigherinterestratesFinancingcostsforUSprivatesectorcontinuedtoshowanupwardmomentumLPRincreasedby25bpssinceJanuarywhile30Yfixed-ratemortgagecostsincreasedbymorethan20bpsinFebruaryThe2YTreasurybondyieldswhichissensitivetoUSFedpolicyratepathinfutureincreasedbyover70bpsinFebruarybuthasretreatedinMarchasmultiplesmallUSbankshavedefaultedduetoashortageofliquidityasaresultofhighinterestratesFigure22GrowthofSouthKoreaExportsImportsFigure23ChinaExportsofGoodsYoYYoY507040605030402030102001001010202030304020172018201920202021202220232017201820192020202120222023ChinaexportsofgoodsKoreaexportsofgoodsKoreaimportsofgoodsKoreaimportsofgoodsfromChinaSourceWINDCMBIGMSourceWINDCMBIGMNotethelatestmonthcoveredthefirst20daysPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE821Mar2023Figure24USTermSpreadasALeadingIndicatorforFigure25USBreakevenInflationtoReflectInflationRecessionRiskExpectationsppt4043032010200101200199219962018202219881990199419982000200220042006200820102012201420162020US10Y-2YT-bondTermSpreads2022201520162017201820192020202120235Ybreak-eveninflationUS10Y-3MT-bondTermSpreadsSourceWINDCMBIGMSourceWINDCMBIGMFigure262YT-bondRatesPrecedeFedPolicyRatesFigure27FedsAssetsinItsBalanceSheetUSbn690005800070004600035000400023000200011000002013202320072008200920102011201220142015201620172018201920202021202220202021200720082009201020112012201320142015201620172018201920222023Federalfundrates2YT-bondratesOtherassetMBST-bondsSourceWINDCMBIGMSourceWINDCMBIGMFigure28FinancingCostsofUSPrivateSectorFigure29USM2andBanksCreditSupply1840YoY1635143012251020815641025005201120122017201820082009201020132014201520162019202020212022202320232013201420152016201720182019202020212022BBcorporatebondsAAcorporatebonds201230Yfixed-ratemortgageLPRsM2supplyBankscreditsupplyConsumercreditSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE921Mar2023Figure30USMortgageRatesDemandFigure31LeadingindicatorsforUSEconomyindexindexYoY83501701016087310150662701404523013024120019031102215010042015201420162017201820192020202120222023201120122013201420152016201720182019202020212022202330YMortgageratesLHSECRIleadingindicatorLHSMortgageapplicationvolumeRHSWeeklyretailsalesdeflatedbyCPIRHSSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1021Mar2023FactoryActivityinChinaFactoryactivitycontinuedtoimproveThedailyaveragecoalconsumptionofpowergeneratorsinSouthChinarose74YoYinthefirsttendaysofMarchafterclimbing24YoYin2M23ThedaysoftheircoalinventorydroppedtoasimilarlevelseeninthesameperiodlastyearOutboundcoalvolumebyshipinQinhuangdaoportslowlyrecoveredwithslightpick-upincoalpricesTheincreaseofcoalimportsrestrainedtheupsidepressureincoalpricesThewholesalereferencepriceofKweichouMoutaihasheldlargelyunchangedasbusinessactivityremainedsteadyinMarchFigure32OutboundCoalVolumePriceinFigure33PortPowerGeneratorsCoalConsumptionQinhuangdaoPortinSouthChinaThtonRMBTonmilliontonDays800180026281600700242614002224600120020221000205001880018400600161630040014142001212200010102020042022012023012020012020072020102021012021042021072021102022042022072022102022-032022-012022-022022-042022-052022-062022-072022-082022-092022-102022-112022-122023-012023-02OutboundvolumeofcoalLHSDailycoalconsumptionLHSThermalcoalpriceRHSDaysofcoalinventoryRHSSourceWINDCMBIGMSourceWINDCMBIGMFigure34WholesaleReferencePriceofKweichowFigure35PricesofPolysiliconPVModulesandMoutaiLithiumCarbonateRmbend-20171003900350370030035002503300200reopening31001502900100502700SHlockdown02500201820192020202120222023PolysiliconPhotovoltaicmodule2022-082021-092021-102021-112021-122022-012022-022022-032022-042022-052022-062022-072022-092022-102022-112022-122023-012023-022023-03LithiumcarbonateSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1121Mar2023CommodityInflationChinasReflationProcessCommoditypricesdroppedamidtherecentturmoilinglobalfinancialmarketsRJCRBcommodityindexdroppedinMarchastherecentturmoilinglobalmarketscausedtherisk-offandconcernaboutarecessionaheadHowevergoldpriceremainedstrongduetothedeclineoflong-terminterestratesandtheincreaseofdemandforsafe-havenassetsChinasreflationremainedweakamidoverseasrecessionriskanddomesticgradualrecoveryPorkpricescontinuedtodeclineinMarchindicatingaweakCPIgrowthinnearterThe2YTreasurybondrateswhicharesensitivetocoreinflationexpectationsheldsteadyfromFebruaryintoMarchChinasPPImayalsofurtherdeclineinneartermascommoditypricesretreatedaftertherecentglobalfinancialmarketturmoilFigure36BDIandCommodityPriceFigure37GlobalM2GrowthCommodityPriceindexindexYoYYoY61004002570602051003505015403041003001020510310025000102100200520301100150104010010020132020201420152016201720182019202120222023201620172018201920202021202220232015M2growthofUSChinaJapanEurozoneLHSBDILHSRJCRBcommodityindexRHSRJCRBindexRHSSourceWINDCMBIGMSourceWINDCMBIGMFigure38US10YReal-termRateGoldPriceFigure39US10YT-bondRatesCoppertoGoldUSounceRatio42200USounce32000585318004721600426140031351200124010002180013116000224002009201020112012201320142015201620172018201920202021202220232006201420222007200820092010201120122013201520162017201820192020202120232005US10YT-bondratesLHSUS10YReal-termrateLHSGoldpriceRHSCoppertogoldpriceratioRHSSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1221Mar2023Figure40GlobalCrudeOilUKNaturalGasPricesFigure41ChinasAgriculturalProductPriceUSbarrelPennytherm20151001406001501205001401004001308030012060200110401001002009020172018201920202021202220232016201820192020202120222023CrudeoilUKnaturalgasAgriculturalproductpriceVegetablepriceSourceWINDCMBIGMSourceWINDCMBIGMFigure42ChinasPorkPriceRmbKgX45254035203015252010151055002021201420152016201720182019202020222023LivehogpriceLHSLivehogtocornpriceratioRHSSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1321Mar2023ChinasLiquidityConditionRMBexchangeRatesLiquidityConditionPBOChasrecentlycuttheRRRby25bpssignalingitseasingbiasforliquidityandcreditpolicytoboosteconomyDR007orbanks7Dreporatesrose27bpsinFebruarybeforedecliningby16bpsinthefirsthalfofMarchPBOCshouldmaintainstableliquidityconditioninneartermtodefyglobalmarketturmoilandboostdomesticmarketconfidenceBondmarketLong-termbondratesmildlyroseafterChinaannouncedtoreopenitseconomybutmildlydeclinedfromearlyMarchThebullishexpectationsaboutChinaseconomicresumptionretreatedCreditconditionThegrowthofoutstandingsocialfinancingmaycontinuetoreboundasrenminbiloansfurtherpickedupandbondfinancingimprovedThePBOCmaymaintaineasingcreditpolicytoboostcreditsupplytotherealsectorespeciallytomanufacturingservicebusinessesandSMEsRMBexchangeratesRenminbimildlydepreciatedagainstUSDollarinthefirsthalfofMarchUSdollarindexreboundedfirstlysupportedbybetter-than-expectedeconomicdataintheUSandthenduetotherecentfinancialmarketturmoilLookingforwardrenminbimayreboundagainstUSdollaraftertheUSeconomystartstoseearecessionWemaintainourforecastonUSRMBspotrateat660atend-2023Figure43ChinaCoreCPIGrowthand2YT-bondFigure44PBOCPolicyRatesRates5044540335302251201501020192020202120222023120162017201820192020202120222023PBOC7DrepoBanks7DrepoChinaCoreCPIgrowthChina2YT-bondrates1YLPR5YLPRSourceWINDCMBIGMSourceWINDCMBIGMFigure45ChinasMoneyMarketRatesFigure46ChinasBondRatesbps5065604555405035453040352530202515202016201720182019202020212022202310201620172018201920202021202220237YTreasurybond7YAAAcorporatebondYueBao3MShibor6MNCD7YAAcorporatebondSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1421Mar2023Figure47ChinasCreditGrowthFigure48US-SinoSpreadUSRMBExchangeYoYRate14pptUSRMB3751311270111653109560201420232009201020112012201320152016201720182019202020212022820082020202120222023US-Sino2YT-bondspreadLHSTSFbalanceM2supplyUSRMBspotrateRHSSourceWINDCMBIGMSourceWINDCMBIGMFigure49EMETFVolatilityWeeklyNorthboundFigure50USHKDRatesInterestRatesInflowUSHKDindexRmbbn7856045504050403040352010780303002510202020103015407750020152016201720182019202020212022202320222023EMETFvolatilityLHSUSHKDLHS3MLiborRHSWeeklyNorthboundinflowRHS3MHiborRHSSourceWINDCMBIGMSourceWINDCMBIGMFigure51HangSengAHPremiumandWeeklyFigure52WoWChangeofMarginBalanceWeeklySouthboundInflowPurchaseonMarginindexHKbnindexHKbn155406080040700150302060020145050010204001400403001351060200801001302010002022202320222023HangSengA-HPremiumLHS2021WoWchangeofmarginbalanceLHSWeeklySouthboundInflowRHSWeeklypurchaseonmarginRHSSourceWINDCMBIGMSourceWINDCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1521Mar2023DisclosuresDisclaimersAnalystCertificationTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportinwholeorinpartcertifiesthatwithrespecttothesecuritiesorissuerthattheanalystcoveredinthisreport1alloftheviewsexpressedaccuratelyreflecthisorherpersonalviewsaboutthesubjectsecuritiesorissuerand2nopartofhisorhercompensationwasisorwillbedirectlyorindirectlyrelatedtothespecificviewsexpressedbythatanalystinthisreportBesidestheanalystconfirmsthatneithertheanalystnorhisherassociatesasdefinedinthecodeofconductissuedbyTheHongKongSecuritiesandFuturesCommission1havedealtinortradedinthestockscoveredinthisresearchreportwithin30calendardayspriortothedateofissueofthisreport2willdealinortradeinthestockscoveredinthisresearchreport3businessdaysafterthedateofissueofthisreport3serveasanofficerofanyoftheHongKonglistedcompaniescoveredinthisreportand4haveanyfinancialinterestsintheHongKonglistedcompaniescoveredinthisreportCMBIGMRatingsBUYStockwithpotentialreturnofover15overnext12monthsHOLDStockwithpotentialreturnof15to-10overnext12monthsSELLStockwithpotentiallossofover10overnext12monthsNOTRATEDStockisnotratedbyCMBIGMOUTPERFORMIndustryexpectedtooutperformtherelevantbroadmarketbenchmarkovernext12monthsMARKET-PERFORMIndustryexpectedtoperformin-linewiththerelevantbroadmarketbenchmarkovernext12monthsUNDERPERFORMIndustryexpectedtounderperformtherelevantbroadmarketbenchmarkovernext12monthsCMBInternationalGlobalMarketsLimitedAddress45FChampionTower3GardenRoadHongKongTel85239000888Fax85239000800CMBInternationalGlobalMarketsLimitedCMBIGMisawhollyownedsubsidiaryofCMBInternationalCapitalCorporationLimitedawhollyownedsubsidiaryofChinaMerchantsBankImportantDisclosuresTherearerisksinvolvedintransactinginanysecuritiesTheinformationcontainedinthisreportmaynotbesuitableforthepurposesofallinvestorsCMBIGMdoesnotprovideindividuallytailoredinvestmentadviceThisreporthasbeenpreparedwithoutregardtotheindividualinvestmentobjectivesfinancialpositionorspecialrequirementsPastperformancehasnoindicationoffutureperformanceandactualeventsmaydiffermateriallyfromthatwhichiscontainedinthereportThevalueofandreturnsfromanyinvestmentsareuncertainandarenotguaranteedandmayfluctuateasaresultoftheirdependenceontheperformanceofunderlyingassetsorothervariablemarketfactorsCMBIGMrecommendsthatinvestorsshouldindependentlyevaluateparticularinvestmentsandstrategiesandencouragesinvestorstoconsultwithaprofessionalfinancialadvisorinordertomaketheirowninvestmentdecisionsThisreportoranyinformationcontainedhereinhavebeenpreparedbytheCMBIGMsolelyforthepurposeofsupplyinginformationtotheclientsofCMBIGMoritsaffiliatestowhomitisdistributedThisreportisnotandshouldnotbeconstruedasanofferorsolicitationtobuyorsellanysecurityoranyinterestinsecuritiesorenterintoanytransactionNeitherCMBIGMnoranyofitsaffiliatesshareholdersagentsconsultantsdirectorsofficersoremployeesshallbeliableforanylossdamageorexpensewhatsoeverwhetherdirectorconsequentialincurredinrelyingontheinformationcontainedinthisreportAnyonemakinguseoftheinformationcontainedinthisreportdoessoentirelyattheirownriskTheinformationandcontentscontainedinthisreportarebasedontheanalysesandinterpretationsofinformationbelievedtobepubliclyavailableandreliableCMBIGMhasexertedeveryeffortinitscapacitytoensurebutnottoguaranteetheiraccuracycompletenesstimelinessorcorrectnessCMBIGMprovidestheinformationadvicesandforecastsonanASISbasisTheinformationandcontentsaresubjecttochangewithoutnoticeCMBIGMmayissueotherpublicationshavinginformationandorconclusionsdifferentfromthisreportThesepublicationsreflectdifferentassumptionpoint-of-viewandanalyticalmethodswhencompilingCMBIGMmaymakeinvestmentdecisionsortakeproprietarypositionsthatareinconsistentwiththerecommendationsorviewsinthisreportCMBIGMmayhaveapositionmakemarketsoractasprincipalorengageintransactionsinsecuritiesofcompaniesreferredtointhisreportforitselfandoronbehalfofitsclientsfromtimetotimeInvestorsshouldassumethatCMBIGMdoesorseekstohaveinvestmentbankingorotherbusinessrelationshipswiththecompaniesinthisreportAsaresultrecipientsshouldbeawarethatCMBIGMmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreportandCMBIGMwillnotassumeanyresponsibilityinrespectthereofThisreportisfortheuseofintendedrecipientsonlyandthispublicationmaynotbereproducedreprintedsoldredistributedorpublishedinwholeorinpartforanypurposewithoutpriorwrittenconsentofCMBIGMAdditionalinformationonrecommendedsecuritiesisavailableuponrequestForrecipientsofthisdocumentintheUnitedKingdomThisreporthasbeenprovidedonlytopersonsIfallingwithinArticle195oftheFinancialServicesandMarketsAct2000FinancialPromotionOrder2005asamendedfromtimetotimeTheOrderorIIarepersonsfallingwithinArticle492atodHighNetWorthCompaniesUnincorporatedAssociationsetcoftheOrderandmaynotbeprovidedtoanyotherpersonwithoutthepriorwrittenconsentofCMBIGMForrecipientsofthisdocumentintheUnitedStatesCMBIGMisnotaregisteredbroker-dealerintheUnitedStatesAsaresultCMBIGMisnotsubjecttoUSrulesregardingthepreparationofresearchreportsandtheindependenceofresearchanalystsTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportisnotregisteredorqualifiedasaresearchanalystwiththeFinancialIndustryRegulatoryAuthorityFINRATheanalystisnotsubjecttoapplicablerestrictionsunderFINRARulesintendedtoensurethattheanalystisnotaffectedbypotentialconflictsofinterestthatcouldbearuponthereliabilityoftheresearchreportThisreportisintendedfordistributionintheUnitedStatessolelytomajorUSinstitutionalinvestorsasdefinedinRule15a-6undertheUSSecuritiesExchangeActof1934asamendedandmaynotbefurnishedtoanyotherpersonintheUnitedStatesEachmajorUSinstitutionalinvestorthatreceivesacopyofthisreportbyitsacceptancehereofrepresentsandagreesthatitshallnotdistributeorprovidethisreporttoanyotherpersonAnyUSrecipientofthisreportwishingtoeffectanytransactiontobuyorsellsecuritiesbasedontheinformationprovidedinthisreportshoulddosoonlythroughaUS-registeredbroker-dealerForrecipientsofthisdocumentinSingaporeThisreportisdistributedinSingaporebyCMBISingaporePteLimitedCMBISGCompanyRegnNo201731928DanExemptFinancialAdviserasdefinedintheFinancialAdvisersActCap110ofSingaporeandregulatedbytheMonetaryAuthorityofSingaporeCMBISGmaydistributereportsproducedbyitsrespectiveforeignentitiesaffiliatesorotherforeignresearchhousespursuanttoanarrangementunderRegulation32CoftheFinancialAdvisersRegulationsWherethereportisdistributedinSingaporetoapersonwhoisnotanAccreditedInvestorExpertInvestororanInstitutionalInvestorasdefinedintheSecuritiesandFuturesActCap289ofSingaporeCMBISGacceptslegalresponsibilityforthecontentsofthereporttosuchpersonsonlytotheextentrequiredbylawSingaporerecipientsshouldcontactCMBISGat6563504400formattersarisingfromorinconnectionwiththereportPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE16