Research Reports

  • HMIN: Expect At Least In-line 2Q14 Topline Results with Better EPS; 3Q14 Is Likely In-line; Maintain Buy
    HMIN2014-08-13

    HMIN: Expect At Least In-line 2Q14 Topline Results with Better EPS; 3Q14 Is Likely In-line; Maintain Buy

    Home Inns & Hotels Management Expect At Least In-line 2Q14 Topline Results with Better EPS; 3Q14 Is Likely In-line; Maintain Buy HMIN will report 2Q14 results on Tuesday, August 12, 2014 after the market close followed by a 9pm EST conference call. We believe HMIN’s 2Q14 results could be toward the high-end of its guidance range and at least in-line with the Street expectation. Considering the slower growth in the number of leased-and-operated hotels and high growth in franchised hotels, we believe HMIN’s margin is likely to improve further. As for 3Q14 guidance, we expect it to be in-line with current consensus at about 8.2% Y/Y. We believe this growth rate is a reflection of China’s sluggish economy. In the long run, when the economy recovers, we believe that HMIN as a recognized bra……

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  • NTES: Strong 2Q14 on Mobile Game and World Cup Event; Aggressive Investment on Multiple Fronts; Maintain Hold Rating
    NTES2014-08-13

    NTES: Strong 2Q14 on Mobile Game and World Cup Event; Aggressive Investment on Multiple Fronts; Maintain Hold Rating

    NetEase, Inc. Strong 2Q14 on Mobile Game and World Cup Event; Aggressive Investment on Multiple Fronts; Maintain Hold Rating  NTES will report 2Q14 results on Wed., August 13th after the market close followed by a 9pm ET conference. We believe NTES’s 2Q14 results may be better than consensus driven by the World Cup and mobile games. However, we believe the company might spend a significant amount of investment in mobile apps, promotion of mobile games and sponsor World Cup events. Therefore, we might see a dip in its margin in 2Q14. While we believe such investment is likely to benefit NTES in the long run, we maintain our Hold rating due to the short term margin pressure.……

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  • T. H. Data Flash – Vipshop Holdings Limited (VIPS) – July 2014: Solid SKU Growth in 2Q14; Growth is Likely To Decelerate in July, But Pick Up in August Due to Promotions
    VIPS2014-08-13

    T. H. Data Flash – Vipshop Holdings Limited (VIPS) – July 2014: Solid SKU Growth in 2Q14; Growth is Likely To Decelerate in July, But Pick Up in August Due to Promotions

    T. H. Data Flash – Vipshop Holdings Limited (VIPS) – July 2014 Solid SKU Growth in 2Q14; Growth is Likely To Deceleratein July, But Pick Up in August Due to Promotions  April - July 2014 Operating Data Highlights:Data in this report is extracted from publicly available sources and processed with our proprietary methodology.•Comprehensive search index decreased in July due to the lack of promotions, which may happenin August –Comprehensive search index of VIP.com (唯品会) increased 20.2% Y/Y in 2Q14, following a 50.8% Y/Y growth in 1Q14. But the index decreased 11.0% Y/Y (Figure 1) for July 2014. We believe the decline is due to the lack of promotions vs. a big promotion on July 19, 2013. From 2Q13 on, there was at least one promotion event in each quarter (Figure 2). In 3Q14,the company ……

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  • SINA: Revocation of Video License Causes Disruption; Expect Near-Term Weakness; Downgrade from Buy to Hold Rating
    SINA2014-08-13

    SINA: Revocation of Video License Causes Disruption; Expect Near-Term Weakness; Downgrade from Buy to Hold Rating

    Sina Corporation Revocation of Video License Causes Disruption; Expect Near-Term Weakness; Downgrade from Buy to Hold Rating  We believe that Sina is dealing with several headwinds that could create uncertainty in the near term. On the one hand, one major negative that may cause weakness in 2Q14 and 3Q14 is the revocation of Sina’s online video license, which was a disruption to the company’s advertising sales. Therefore, Sina’s portal business may not show better growth even with a big advertising event like the World Cup. In addition, compared with the rapid growth in China’s internet and mobile sectors, SINA’s investment in its new business seemed to lag behind its peers. We believe the company needs to invest in verticals as well as mobile to reinvigorate the business. Due to unce……

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  • LONG: Room Nights Growth Stabilized in 2Q14; Penetration Into Lower-end Hotels is Speeding Up; Maintain Hold
    LONG2014-08-13

    LONG: Room Nights Growth Stabilized in 2Q14; Penetration Into Lower-end Hotels is Speeding Up; Maintain Hold

    eLong Inc. Room Nights Growth Stabilized in 2Q14; Penetration Into Lower-end Hotels is Speeding Up; Maintain Hold  Behind LONG’s better 2Q14 results and slightly disappointing 3Q14 revenue guidance, we are encouraged by its accelerating volume growth compared with last quarter. The acceleration and a couple of other improvements we believe signal the stabilization in its hotel business. At the same time, the company is continually expanding its coverage of lower-end hotels by 1) offering more hotel products including prepaid, flash sale and last minute sales to consumers; and 2) providing free hotel PMS system to accommodations that lack IT capacity. We believe lower-end hotels could serve as a long term growth driver for LONG. However, as the competitive landscape is quite dynamic, w……

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  • SFUN: Perfect Storm is Over; Downside Risk is Limited; Maintain Buy
    SFUN2014-08-13

    SFUN: Perfect Storm is Over; Downside Risk is Limited; Maintain Buy

    Soufun Holdings Ltd. Perfect Storm is Over; Downside Risk is Limited; Maintain Buy  SFUN reported mixed 2Q14 results as revenue missed consensus but EPS beat the Street's expectations by a wide margin. The company also made a significant downward adjustment to its full year guidance to reflect the negative impacts from a perfect storm including: 1) market weakness; 2) price cut in its listing services; and 3) under-investment in its e-commerce business. At this point, we believe most of the negatives surrounding the stock are highly likely built into the stock price and the worst is likely behind the company. In addition, we believe the weakness in China’s real estate market may not get any worse and it is a matter of time for the market to recover. When the recovery happens, we b……

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  • HTHT: Expect Better Revenue Results And Inline EPS In 2Q14; 3Q14 Consensus Could Be Aggressive; Maintain Hold Rating
    HTHT2014-08-13

    HTHT: Expect Better Revenue Results And Inline EPS In 2Q14; 3Q14 Consensus Could Be Aggressive; Maintain Hold Rating

    Huazhu Hotels Group Ltd. Expect Better Revenue Results And Inline EPS In 2Q14; 3Q14 Consensus Could Be Aggressive; Maintain Hold Rating  HTHT will report 2Q14 results on Monday, August 11, 2014 after the market close followed by a 9pm EST conference call (or 9am on Tuesday, August 12, 2014 Beijing / Hong Kong time). We believe HTHT could report better 2Q14 revenue and inline EPS based on the company’s preliminary operating results. However, we believe HTHT is unlikely to provide 3Q14 guidance better than the Street expectation due to slower growth in the number of leased hotels and slight decline of RevPAR on a Y/Y basis. HTHT is currently trading at a premium to its peers and we believe it is fairly valued at its current price. As such, we maintain our Hold rating.……

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  • YY: Different Types of Live Shows to Drive Conversion and ARPU; New User Growth is Key to Future Growth; Maintain Hold
    YY2014-08-13

    YY: Different Types of Live Shows to Drive Conversion and ARPU; New User Growth is Key to Future Growth; Maintain Hold

    YY Inc. Different Types of Live Shows to Drive Conversion and ARPU; New User Growth is Key to Future Growth; Maintain Hold  YY reported stellar 2Q14 results and provided 3Q14 guidance above consensus by a wide margin, which was primarily driven by the strong growth in different types of live show business including music, game broadcastings and dating shows. We believe YY may continue its efforts toconvert existing users into paying users and increase per user spending in the near term; however, we believe the future upside depends on the growth in users. On this front, we have yet to see meaningful results. As such, we maintain our Hold rating.……

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  • DANG: Expect Better 2Q14 Results and At Least Inline 3Q14 Guidance; Profitability is Likely Sustainable; Upgrade to BUY
    DANG2014-08-13

    DANG: Expect Better 2Q14 Results and At Least Inline 3Q14 Guidance; Profitability is Likely Sustainable; Upgrade to BUY

    E-Commerce China Dangdang, Inc. Expect Better 2Q14 Results and At Least Inline 3Q14 Guidance; Profitability is Likely Sustainable; Upgrade to BUY  We expect DANG to report better 2Q14 results and provide inline 3Q14 guidance due to the ongoing execution of its marketplace strategy, category management, and a stabilized competitive environment. As such, webelieve DANG’s profitability is likely to be sustainable in the foreseeable quarters. Taking into consideration of the better outlook in both the long and short term, we upgrade DANG from Hold to Buy with a price target of $17.00. DANG will report 2Q14 results on Thursday, August 14, 2014 prior to the market open with a 7:00am ET conference call.……

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  • T. H. Data Flash – China Online Recruitment – July 2014: Continued Softness in Job Postings Growth with a Bigger Drop in Manufacturing and Higher Increase in IT
    JOBS2014-08-13

    T. H. Data Flash – China Online Recruitment – July 2014: Continued Softness in Job Postings Growth with a Bigger Drop in Manufacturing and Higher Increase in IT

    T. H. Data Flash – China Online Recruitment – July2014  Continued Softness in Job Postings Growth with a BiggerDrop in Manufacturing and Higher Increase in IT July 2014 Operation Data Highlights:In July of 2014, the number of daily job postings increased 15.1% Y/Y for JOBS (Figure 1) and 13.2% Y/Y for ZPIN (Figure 2), according to our proprietary data. Both of these growth rates were slower than the growth in 2Q14 at 18.6% and 14.4%, respectively.  •JOBS: Increasing penetration into lower tier cities – In July, the Y/Y growth of daily job postings on 51job.com slowed to 15.1% from 18.6% in 2Q14 (Figure 1), while the growth rate of the postings in areas outside of tier 1 and tier 2 cities continued its high growth at 23.2% Y/Y in July (Figure 5). As a result, job postings in those……

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  • T. H. Data Flash – China Civil Aviation Airport Monthly – July 2014: Impact From Flight Delays and Cancellations May Be Short-Lived During the Peak Leisure Travel Season
    2014-08-13

    T. H. Data Flash – China Civil Aviation Airport Monthly – July 2014: Impact From Flight Delays and Cancellations May Be Short-Lived During the Peak Leisure Travel Season

    T. H. Data Flash – China Civil Aviation Airport Monthly –July 2014  Impact From Flight Delays and Cancellations May Be Short-Lived During the Peak Leisure Travel Season INDUSTRY HIGHLIGHTSThe number of aircraft movements in China is likely to increase 13.4% M/M in July, based on our proprietary data (Figure 1). The M/M increase in July was attributable to more revenue days and more average daily aircraft movements in July as a result of stronger leisure travel demand during the summer vacation. The impact of bad weather and air control in late July is likely to be short-lived and airports might benefit from the expansion of airlines’ fleet capacity.……

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  • T. H. Data Flash – China’s Mobile Browser Market - August 2014: UCWeb, Tencent and Qihoo Lead the Mobile Browser Market

    T. H. Data Flash – China’s Mobile Browser Market - August 2014: UCWeb, Tencent and Qihoo Lead the Mobile Browser Market

    T. H. Data Flash – China’s Mobile Browser Market - August 2014  UCWeb, Tencent and Qihoo Lead the Mobile Browser Market August 2014 Data Highlights:Data in this report is extracted from 21 Android App Stores in China including  Qihoo, Anzhi,Baidu Group (91 Kuwan, 91 Mobile Assistant, Android market and Baidu appstore), Jifeng, Mu Ma Yi, Youyi, Sohu, Nduo, Netease, Tencent, Pconline, XiaZai Ba, Shou You, Wan Dou Jia, Sina, Huawei, app China and Lenovo, and processed with our proprietary methodology.•Mobile browser market is highly concentrated, where the top 3 vendors take ~82.7% of the download market share - According to ourproprietary data, China's mobile browser market is highly concentrated, where the top 3 vendors accounted for 82.7% of the total market share measured by……

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  • SFUN: Coping With Market Headwinds; Downward Adjustment to Revenue and Earnings; Maintain Buy but Lower PT
    SFUN2014-08-13

    SFUN: Coping With Market Headwinds; Downward Adjustment to Revenue and Earnings; Maintain Buy but Lower PT

    Soufun Holdings Ltd. Coping With Market Headwinds; Downward Adjustment to Revenue and Earnings; Maintain Buy but Lower PT China's real estate market is under pressure with lighter transaction volumes in both primary and secondary properties, which may impact SFUN's growth in the coming quarters. The impact can be significant in listing services. Recently, major offline agencies, the main contributors for SFUN's listing service revenue or about 30% of the total revenue, formed an alliance and forced SFUN to cut down the listing price by about 40%. In addition, the ecommerce business may also slow down due to weakness in the marketplace. As such, we make downward adjustments to our revenue and earnings estimates.However, we believe most of these negatives are already out and SFUN……

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  • YY: Continued Growth of Music Business in 2014; New Business Initiatives Have Yet to Take Off; Maintain Hold
    YY2014-08-13

    YY: Continued Growth of Music Business in 2014; New Business Initiatives Have Yet to Take Off; Maintain Hold

    YY Inc.  Continued Growth of Music Business in 2014; New Business Initiatives Have Yet to Take Off; Maintain Hold YY will report 2Q14 results on Wednesday, August 6, 2014 followed by a conference call at 9:00 pm EST. We believe the company may deliver at least inline or better 2Q14 results and 3Q14 guidance driven mainly by its music business. We believe the newer businesses including online education and mobile social network play a role to drive future business growth, and they have yet to take off. As such, we maintain our Hold rating.……

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  • CTRP: Is There a Choice Except to Invest? Maintain Buy and Raise Price Target
    CTRP2014-08-13

    CTRP: Is There a Choice Except to Invest? Maintain Buy and Raise Price Target

    Ctrip.com International Ltd.  Is There a Choice Except to Invest? Maintain Buy and Raise Price Target In order to maintain its leading position in China’srapidly evolving travel market, we believe CTRP has no other choice but to invest in both branding and products. Otherwise, it would be left behind by themarket. What is worth pointing out is that CTRP has a good track record in the execution of its investments. In the recent past including 2Q14, its investment initiatives all yielded significant improvement in its business. CTRP’s 2Q14 results came in above its own guidance and consensus even though margins were much lower than 2Q13. We believe that as the company is determined to continue its investment for at least the rest of 2014, it is highly likely that we may see better resul……

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  • CTRP: Market Share Expansion Continued in 2Q14; Maintain BUY
    CTRP2014-08-13

    CTRP: Market Share Expansion Continued in 2Q14; Maintain BUY

    Ctrip.com International Ltd.  Market Share Expansion Continued in 2Q14; Maintain BUYWe expect at least inline 2Q14 results and 3Q14 guidance even though there might be some negative impact from fixed commission rate cuts from state owned airlines in 3Q14. The upside in revenue is mainly coming from volume growth in both hotel and air ticket bookings. As the momentum is likely to continue, we maintain our Buy rating but we will revisit our price target after 2Q14 earnings results, which will be released after the market closes on Wednesday, July 30, 2014 with an 8pm EST conference call.  ……

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  • BIDU: Stabilization in Spending May Drive Better Margin in 2Q14; Maintain Hold Rating
    BIDU2014-08-13

    BIDU: Stabilization in Spending May Drive Better Margin in 2Q14; Maintain Hold Rating

    Baidu, Inc.  Stabilization in Spending May Drive Better Margin in2Q14; Maintain Hold Rating  BIDU will report 2Q14 results on July 24th after the market close with a 9pm ET conference call. We expect at least inline 2Q14 revenue results and 3Q14 guidance driven by PC search monetization, mobile business as well as acquired revenues. However, as we believe BIDU did not have additional spending compared to what the Street expected, there is a high possibility that BIDU’s EPS may be better than the Street expectation. We maintain our HOLD rating at this point, but we will revisit the company’s outlook and valuation post earnings.……

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  • XRS: Capacity Expansion Drives Revenue Growth; Small Class Focus Drives Margin Growth; Maintain BUY and Raise PT to $31.00
    XRS2014-08-13

    XRS: Capacity Expansion Drives Revenue Growth; Small Class Focus Drives Margin Growth; Maintain BUY and Raise PT to $31.00

    Chinese TAL Education Group Capacity Expansion Drives Revenue Growth; Small Class Focus Drives Margin Growth; Maintain BUY and Raise PT to $31.00   XRS reported strong FY1Q15 results better than consensusin both revenue and EPS, primarily driven by strong enrollment growth in smallclass. The enrollment growth can continue to go up, as we believe XRS will continue to expand its capacity, which can serve as a driver for enrollments.In addition, we believe its margin has upside potential as the company is focusing more on small class expansions. Putting all this together, we believe the company is adopting a balanced approach toward revenue growth and margin improvement. As such, we maintain our BUY rating and raise our price target to $31.00 from $29.00.……

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  • EDU: Expect  Inline or Better FY4Q14 Results; Less Visibility May Lead to Weaker FY1Q15 Guidance; Maintain BUY
    EDU2014-08-13

    EDU: Expect Inline or Better FY4Q14 Results; Less Visibility May Lead to Weaker FY1Q15 Guidance; Maintain BUY

    New Oriental Education & TechnologyExpect Inline or Better FY4Q14 Results; Less Visibility May Lead to Weaker FY1Q15 Guidance; Maintain BuyEDU will report FY4Q14 results before the market opens on July 22, 2014 with an 8:00AM EST conference call. We believe the company may deliver FY4Q14 results inline or slightly better than consensus driven mainly by the growth of course price. However, as of FY1Q15, the company may not be able to provide good guidance as the visibility of FY1Q15 enrollment is weak based onour proprietary data, which we believe could be caused by late registration among students. Looking beyond the near term earnings and guidance, we believe in the long run the company is well positioned to capture the high demand of China’s education market; and EDU is likely to res……

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  • T. H. Data Flash – Online Auto Marketing – June 2014: Solid Growth of Dealer Subscription Business; High Rate of Overlap In Dealers and In Regional Allocations
    2014-08-13

    T. H. Data Flash – Online Auto Marketing – June 2014: Solid Growth of Dealer Subscription Business; High Rate of Overlap In Dealers and In Regional Allocations

    T. H. Data Flash – Online Auto Marketing – June 2014Solid Growth of Dealer Subscription Business; High Rate ofOverlap In Dealers and In Regional AllocationsData in this report is extracted from publicly availablesources and processed with our proprietary methodology.Steady growth in total registered dealer bases, high growthin paying dealers for both ATHM and BITA - According to our proprietary data,the number of total unique subscribing dealers of ATHM reached about 14.6K in2Q14 from 12.7 in 1Q14, representing 15% Q/Q growth, while BITA had about 16.7Kunique paying users in 2Q14, reflecting 23% Q/Q growth (Figure 1). The highernumber of paying accounts came from both the increase in the total number ofregistered dealers as well as paying account conversion. Total registereddealers on BITA……

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