sandalwood

Sunrise and CDF Hainan platforms deteriorated to -55% y/y in F3Q24(ending Mar-24)  from -52% y/y in the last quarter.

Live streaming platforms accelerated in F3Q24(ending Mar 24), partially offset Tmall/JD weakness.

Based on China Auto Insurance data’s 19,101 units of Seres passenger cars delivery in Feb MTD, we estimate the company’s full Feb delivery at 23,000-25,000 passenger cars, outperforming peers despite a slowdown on the CNY holiday. The data indicates that M7 model continued to be a significant contributor to Seres’s outperformance in Feb MTD. M9 model commenced delivery on Feb 26. Considering its impressive number of non-refundable orders disclosed by the company, we expect M9 to be another strong driver for Seres in the upcoming months.

Sandalwood estimates Lululemon’s Ex-NA Rev in F4Q23 (ending Jan-24) to accelerate to +55-60% y/y (USD), at high-end of consensus, mainly driven by strong growth in People’s Republic of China (PRC). The strength is driven by 1) successful marketing strategy and 11.11 promotion, 2) booming outdoor/sports activities in China, and 3) rapid store expansion. Sandalwood data shows Lululemon is not only doing well in its core yoga-related products, but also in other product lines such as sports jackets and trousers.

In Oct-23, Sandalwood captured existing-home GTV (RMB) and sales volume grew at +12% y/y and +28% y/y respectively, remaining resilient compared to last quarter’s +11% y/y and +14% y/y respectively; we estimated the GTV and total number of second-hand properties closed would further improve to +23% y/y and +39% y/y in Nov from Oct’s +12% y/y and +28% y/y.Existing home visit numbers remained healthy in Nov-23 at +59% y/y; Shenzhen weekly visits witnessed an uptick in the last week of Nov thanks to the lowered down payment to 40% for the second-purchased home starting from Nov 23rd 

Positive: Travel sector, Japan tourism, Isetan, H2O Retailing, J Front Retailing, Ctrip, Tongcheng Elong, Moncler

1. On y/y basis, Retail/Restaurant remain largely seasonal in Aug MTD vs. Jul, while Auto becomes less negative, although still ample room for recovery. Housing (new home sales) continues to be the most negative, but likely close to the bottom as more support measures roll out in early Sep. 

2. Chinese luxury spending continues to be healthy based on daily trend, mainly supported by Hong Kong, Macau, Japan, and other regions in APAC. Moncler outperforms the most.

Sandalwood estimates Nike Brand Greater China Revenue Y/Y (USD) to accelerate in F4Q23 (ending May-23), driven by 1) strong online sales performance during the 6.18 promotion pre-sales period, 2) increased outdoor activities, and 3) easy comps from the lockdown last year.

Fresh Made Beverage sector is expected to continue its growth trends in the next 5 years; the chain rate is expected to further increase. Chain brands are willing to expand in lower city tiers.

In Jun-23, most coffee names' sales value y/y slightly slowed down on normalizing comps; looking at y/2y, Starbucks become slightly less negative yet still remained stagnant.

Luckin Coffee y/y slightly slowed down in Jun-23 mainly due to the lowered ticket size as Luckin started another round of coupon give-away to celebrate the opening of 10,000th stores (source); volume y/y accelerated to +62% y/y from May-23's +54% y/y.

Though the y/y strength of new home sales in 1Q23 is partly attributable to the one-time release of the pent-up demand accumulated during the pandemic, we do notice Beike new home sales outperformed the overall market’s growth rate of ~20% y/y. It might indicate that Beike will be taking more shares in 1Q23. Therefore, we have a positive view on Beike.

Sandalwood projects Luckin Coffee reporting net product revenue (in RMB) to grow at +65-70% y/y in 1Q23, recovering from last quarter’s +44% y/y. No consensus to compare with.

Yanker Shop is the major market share gainer in Deli food (Subsector under Snacks) in 1Q23. The brand also continuously outperformed its sector since Jan 2022.

In 2022, the deliveries of the overall car sector grew -3% y/y, facing challenges from Covid restrictions, despite benefiting greatly from stimulus policies in 2H, especially the halved purchase tax for small-engine cars.

Compared to the previous generation after 3 weeks since launch, iPhone 14 standard model underperforms, iPhone 14 Pro/Pro Max perform decently, while Apple Watch 8 outperforms.

Our data suggest Gucci continues to underperform peers, likely due to 1) several negative social media coverages earlier this year, 2) brand positioning as “trendy pieces” vs. peers’ “timeless pieces”

1、Hermes continues to outgrow peers; Domestic jewelers, especially Chow Tai Fook, further accelerate in Jul

2、Express shipment remains healthy led by J&T/STO/JDL in Jul

3、Lululemon soars on JD store opening and resilient Tmall; Xtep outperforms; Nike retains recovered-level in Jul