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HSI +507pts (+1.8%) 28,817 HSCEI +204pts (+2%) 10,674 T/O HK$156.56bn (+10.7% DoD)
Markets opened mixed despite good PMI data +VE for the recovery. Bitcoin remains volatile. UK FTSE opened flat and trading sideways, Germany and France trending lower. Retail names weak, Resources +VE as the reserve releases from China less than expected.
Services Jun 58.0 vs 52.2 May (F/cast was 57.6)
Manufacturing Jun 63.1 vs 63.1 May (F/cast was 62.2)
Composite Jun 59.2 vs 57.1 May (F/cast was 58.9)
Services Jun 58.1 vs 52.8 May (F/cast was 54.7)
Manufacturing Jun 64.9 vs 64.4 May (F/cast was 63.8)
Composite Jun 60.4 vs 56.2 May (F/cast was 56.9)
Services Jun 57.4 vs 56.6 May (F/cast was 58.7)
Manufacturing Jun 58.6 vs 59.4 May (F/cast was 58.5)
Composite Jun 57.1 vs 57 May (F/cast was 58.7)
Services Jun vs 62.9 May (F/cast was 62.5)
Manufacturing Jun vs 65.6 May (F/cast was 64.5)
Composite Jun vs 62.9 May (F/cast was 62.7)
Opened flat Dow +28pts, S&P flat and NDX +0.1% they rose in Asian time to Dow +82pts, S&P and NDX slightly +VE. But now Dow +36pts S&P and NDX flat.
Ahead MBA Mortgage Applications and 30 yr Mortgage Rate, Current Account, Manufacturing, Services and Composite Flash PMI’s, New Home Sales, EIA Oil Report.
NY Fed Treasury Purchases 4.5 - 7 yrs, 2 yr FRN Auction and 5yr Note Auction.
FED Speakers Bowman, Bostic and Rosengren speak
Earnings: IHS Markit, Winnebago, KB Home, Steelcase
CHINA CSI 300 closed +25pts (+0.5%) @ 5,147
CSI 300 opened slightly higher, initially dipped but then rallied with resistance at 5,171 then eased into lunch +45pts (+0.9%) @ 5,167. Choppy trading suggesting Team China active. PM the market stepped lower, initially to 5,144, bounced, then down to 5,133 before a rally into the close.
Growth and tech-heavy ChiNext Index outperforming the broader
market, as risk-on mode returns after Nasdaq stocks rebound and Treasury yields dropped overnight.
Leaders photoresist, semiconductors, lithium batteries, and coal miners
Laggards white liquor, aviation, food and beverage, and petroleum names.
Brokers downgrading China growth targets to 8.4% from around 9%. China announced to release next month will include 20,000 tons of copper, 30,000 tons of zinc and 50,000 tons of aluminum. With the exception of zinc, the volumes look light compared with expectations.
Shanghai Composite +9pts (+0.3%) @ 3,566
Shenzhen Composite +148pts (+1%) @ 14,848
ChiNext Composite Index +38pts (+1.1%) @ 3,434
China confirmed 24 additional COVID-19 cases Tuesday (22 June), all being imported infections, reported by National Health Commission of the PRC.
Guangdong's National Health Commission reported zero additional local COVID-19 cases yesterday (22 June), along with three imported cases.
HSI Pre market opened @ 28,468 +158pts vs+82 pts ADR’s
With E-Commerce, Macau, Auto and Tech weak on intial margin call selling but then worked higher to 28,763 just before lunch and ticked lower to 28,717 (+407pts +1.5%) at lunch. PM saw the market trade sideways for the first 90 minutes it then ticked up to 28,880 and then worked higher but resistance at 28,894 and eased back into the close.
A strong rebound as Powell confirmed that stimulus and rates would not be chanfged anytime soon. Key though was that HK T/O was little changed
HONG KONG DATA
The Centre for Health Protection (CHP) reported 2 new covid cases all imported (vs 7 imported on Tuesday)
A mutant virus was found in sewage samples in Tai Po, involving fewer than five initially positive cases according to sources. One patient dwells in Tai Po. The Government announced that, since the sewage samples collected in a specified area in Tai Po have tested positive, and a very high viral load is detected in these samples, all buildings and structures within the area are covered by the compulsory testing notice today. They include Yat Nga Court, Tak Nga Court, King Nga Court, Classical Gardens, Grand Dynasty, The Balmoral, Ting Wai Monastery, Po Leung Kuk Tin Ka Ping Primary School, etc.
Short Selling Wednesday 15.6% vs 15.1% Tuesday
Top Shorts BankComm (3328) 45%, Bud APAC (1876) 45%,Bank of China (3988) 40%, Country Garden (2007) 36%, Citic (267) 35%, Haidilao (6862) 32%, CLP (2) 32%, Ping An (2318) 29%, Henderson Land (12) 26%, MTRC (66) 25%, Meituan (3690) 25%.
AFTER MARKET NEWS
REGENT PACIFIC (00575.HK) announced that the stock short name of the Company for trading in the Shares on the HK Stock Exchange will be changed from “REGENT PACIFIC” to “ENDURANCE RP” in English with effect from 28 June 2021. The stock code of the Company on the HK Stock Exchange remains unchanged.
The vice chairman and executive director of WYNN MACAU (01128.HK), Linda Chen, expressed her wish for the COVID-19 outbreak in Guangdong and Hong Kong to become under control, so that the number of inbound visitors to Macau would see a rebound during the Summer holiday and subsequently boost the GGR, reported Radio Macau.MTR CORPORATION (00066.HK) announced the next phase of the corporate reorganisation, where Adi Lau Tin-shing, currently the Managing Director – Operations and Mainland Business of the Company, will be appointed as the Managing Director – Mainland China Business and Global Operations Standards of the Company. He will continue to be a Member of the Executive Directorate of the Company. All changes will take effect from 1 July.
Bond (04246.HK), on debut, opened at $103.1, up 3.1%. It logged the peak and trough at $103.25 and $102.9. In last printing, the iBond stood at $102.95, up 2.95% against the offer price at $100.
FE CONSORT INTL (00035.HK)’s chief of property Raymond Fong expressed the company project in Shatin will be named "Mount Arcadia". The project will provide 62 flat units and 4 houses, with sizes of the flat units ranging from 1,018-1,548 sq.ft. and that of the houses ranging from 2,800-3,400 sq.ft.. Fong revealed that the prices will be ranging from approximately $25,000-30,000 per sq.ft. and that the project will be launched next month at the earliest and will be sold by way of tender as complete flats.
*COMMODITIES MIXED prices continue to rise despite China trying to stabilise prices. A weaker USD also helps to support commodity prices. PETROCHINA (857 HK +2.5%) CNOOC (883 HK +0.9%) despite Russia and other OPEC+ nations are considering raising production in the wake of a tightly-supplied global crude market.
China plans to sell the first batch of 20,000 tons of copper from its state reserves on July 5-6. It will also sell 30,000 tons of zinc and 50,000 tons of aluminumm, which is lower-than-expected. JIANGXI COPPER (358 HK +2%) CHALCO (2600 HK +8.4%).
CH COAL (1898 HK +5%) YZ COAL (1171 HK +7.4%) as coal prices remain strong.
*E-COMMERCE/INTERNET STRONG on positive sector sentiment, after Nasdaq stocks rebound overnight, and newly listed ChiNext stock SUZHOU NANOMICRO TECH-A rocketed 1400% on trading debut.
KUAISHOU (1024 HK +6.2%) and China Central Broadcasting Corporation held a joint press conference in Beijing, announcing that the two parties have reached a short video strategy for the 2020 Tokyo Olympics and the 2022 Beijing Winter Olympics. Kuaishou also disclosed that its number of global monthly active users has reached 1bn. BABA (9988 HK +2%) JD (9618 HK +2.6%) MEITUAN (3690 HK +5.2%).
*TECH & COMPONENTS STRONG led higher by chip makers amid positive outlook on Chinese semiconductors. HUA HONG (1347 HK +7.6%) SMIC (981 HK +3%) SOLOMON SYSTECH (2878 HK +17%).
*AUTO MAKERS STRONG after TSMC predicts that most automotive chip orders will be resolved in Q3 of this year. GEELY (175 HK +6.2%) CEO gave +VE press inteview. BYD (1211 HK +3%) GREAT WALL (2333 HK +6%).
*CHINA PROPERTY FLAT
CH EVERGRANDE (3333 HK -3.9%) bonds slumped yesterday after reports that several large Chinese banks are restricting credit to the firm and Fitch Ratings downgraded it deeper into junk territory -VE.
*PHARM/MEDICAL STRONG on positive news as China issues list of Covid vaccine available for EXPORTS, including SINOPHARM (1099 HK +3%), Sinovac, and CANSINO (6185 HK +12%).
CANSINO BIO also announced its meningitis vaccine has received regulatory approval.
HANSOH's (3692 HK +5.2%) hep B drug Imitenofovir Tablets has received regulatory approval in China.
VIVA BIOTECH (1873 HK +8.4%) announced that Totient, a biomed company it invested and incubated, reached an acquisition agreement with AbSci, to add new antibody and target discovery technologies to its therapeutic protein design and biomanufacturing optimization platform.
ASX 200 sold down initially after PMI’s were lower than expected and news Sydneysiders were largely banned from leaving the city due to a rise in covid cases. Market sold down to 7,303 but 7,005 was the support until 45 minutes before the close when the market trended lower held at 7,300 for a while but then dipped to 7,292 before a rally to close -44pts (-0.6%) @ 7,299. The rise in covid cases -VE for travel names. Laggards Financials & Healthcare along with Woolies (announced a $50 m non-cash impairment across its metro stores due to the impact of COVID-19). Leaders BHP, Fortecue and Afterpay.
Data Flash PMI’s
Manufacturing Jun 58.4 vs 60.4 May (F/cast was 61)
Services Jun 56 vs 58 May (F/cast was 59)
Composite Jun 56.1 vs 58 May (F/cast was 59)
Nikkei opened slightly higher and traded sideways 29,008/28,860
Closed for lunch around the mid point. PM opened lower traded sideways in a tighter range 28,915/28,895 but sold down in the last 10 minutes to close -9pts (-0.03%) @ 28,875. Consumer names +VE but weakness in Shipping
Softbank AGM, Son says he’ll remain Chairman after 69, defends autocracy.
Topix Opened lower 1,955 rallied to flat but then dropped with support around the opening level. Then late morning sold down to 1,952 and traded sideways into lunch. PM drifted lower with support at 1,950 but sold down in last 10 minutes to close -10pts (-0.5%) @ 1,949
Manufacturing Jun 51.5 vs 53 May (F/cast was 53.1)
Services Jun 47.2 vs 45.7 May (F/cast was 47)
Composite Jun 47.8 vs 48.8 May (F/cast was 49)
Coincident Index Final Apr 95.3 vs 92.9 Mar (F/cast was 95.5)
Leading Economic Index Apr 103.8 vs 102.4 Mar (F/cast was 103)
Govt to propose a record extra budget +VE for sentiment but upside capped as KDCA announced 645 new covid cases ( +250 DoD) with 605 local transmissions
Kospi opened higher and traded 3,265/3,275 until late morning then stepped higher to trade 3,280/3,275 and closed +12pts (+0.4%) @ 3,276.
Kosdaq opened higher, ticked up to 1,018, eased and then worked slowly better but resistance at 1,020 after which it sold off to close +5pts (+0.5%) @ 1,027.
After market Govt announced to invest KRW220 billion (around US$190 million) in the next five years to be the first to develop 6G technology through joint research with the U.S., said the country's Ministry of Science and ICT at a meeting.
Taiex opened higher as covid cases drop and despite weak consumer confidence data. It traded around 17,150 for the first 30 minutes then rallied. but saw resistance approaching 17,300 and traded 17,250/300 until 1pm when the market ticked higher to 17,333 and worked higher to close +261pts (+1.5%) @ 17,337 T/O was US$18.74m vs US$19.51bn Tuesday.
CECC reported 104 new covid cases (all domestic) and the Level 3 restrictions were extended to July 12
After market a 4.9 earthquake hit Hualien in Eastern
Industrial Production May +16.51% YoY vs +14.1% Apr revised from 13.62 (F/cast was +10%)
Retail Sales May +2.8% YoY vs +18.27% Apr (F/cast is +21%)
Northbound Rmb 51,672m Sell 23,331m vs 28,341m Buy
Southbound HK$ 19,946m Sell 10,140m vs 9,805m Buy
Northbound Rmb 64,214m Sell 30,513m vs 33,702m Buy
Southbound HK$ 21,987m Sell 10,984m vs 11,003m Buy
MEITUAN (03690.HK) +5.2%
AIA (01299.HK) +3%
PING AN (02318.HK) +2.1%
BABA (09988.HK) +2.1%
TENCENT (00700.HK) +1.6%
HSI & HSCEI Constituents on Move:
SUNNY OPTICAL (02382.HK) +7%
KUAISHOU-W (01024.HK) +6.2%
GEELY AUTO (00175.HK) +5.8%
HANSOH PHARMA (03692.HK) +5.2%
CG SERVICES (06098.HK) +4.6%
MENGNIU DAIRY (02319.HK) +4.3%
EVERGRANDE (03333.HK) -3.9%
ANTA SPORTS (02020.HK) +3.2%, hitting new high
SMIC (00981.HK) +3%
CKH HOLDINGS (00001.HK) +3%
PETROCHINA (00857.HK) +2.5%, hitting new high
CK ASSET (01113.HK) +2%, hitting new high
HSMI & HSSI Constituents on Move:
C-MER EYE (03309.HK) +19.9%, hitting new high
ANTENGENE-B (06996.HK) +17.9%
CANSINOBIO (06185.HK) +12.4%
UNI MEDICAL (02666.HK) +11.5%, hitting new high
MARKET HOURS NEWS.
The 5th phase of centralized drug procurement in China amounted to around RMB55 billion with the variety of the purchased drugs reaching a new high of 62 types, reported CCTV. Injection drugs became the focus for this phase, accounting for half of the procured drugs, involving 70% of the total expense.
HKTV (01137.HK)'s HKTVmall announced that, in response to the government's electronic consumption voucher scheme, the company will include Octopus, AlipayHK, WeChat Pay as the three new electronic payment methods, both online and offline, effective from early July. In addition, HKTVmall will provide a 30% cash voucher discount to customers who use Octopus, AlipayHK or WeChat Pay to pay at any HKTVmall O2O stores from 1 July-21 July, allowing them to purchase the $500 HKTVmall cash voucher by $350.
NEXT DIGITAL (00282.HK)'s board of directors regrets to announce that due to the current circumstances prevailing in Hong Kong, Apple Daily in its print form will come to an end no later than the last edition on Saturday 26 June 2021 and the digital version will no longer be accessible no later than 11:59 p.m. on Saturday 26 June 2021.
The U.S. and China are discussing the possibility of arranging a meeting between The U.S. Secretary of State Anthony Blinken and Chinese Foreign Minister Wang Yi during the G20 meeting in Italy next week, reported Financial Times, citing people familiar with the matter. The report added that the U.S. government has also expressed its wish for its Deputy Secretary of State Wendy Sherman to visit China in Summer to its Chinese counterpart.
Hong Kong Trade Development Council (HKTDC) announced that, marking its fifth consecutive quarterly increase, the 2Q21 HKTDC Export Index rose to 48.7, well up on the 39.0 recorded for the preceding quarter and a world away from the 16.0 scored for 1Q20 in the very early days of the Covid-19 outbreak.
HKTDC decided to raise its 2021 export growth forecast for the city to 5% from 15%, likely being the strongest export rebound since the post-financial crisis recovery in 2010 under low-base effect, said Director of Research Nicholas Kwan at the press conference.
Although transports by air, ocean and rail are all recording substantial growth, certain amount of the orders are expected to switch to air freight due to the increasing amount of orders with smaller quantities, which would entail prolonged pressure for air freight industry. The cost of ocean freights, however, TDC added, might not necessarily continue its climb as shipping companies are gradually adapting to the new norms.
KUAISHOU-W (01024.HK) and China Media Group held a joint conference in Beijing, where both sides clinched a strategic cooperation for broadcasting right for 2022 Winter Olympic Games in Beijing and Tokyo 2020 Olympic Games, Chinese media reported. KUAISHOU-W has already possessed 1 billion monthly active users (MAUs) around the world, said the CEO Su Hua.
BABA-SW (09988.HK)'s new retail platform Hema announced to launch its warehouse member stores "X Member Store" across China, with two new stores in Beijing and Shanghai already opened from 18 June. Hema expressed the preparation work for further expansion is already underway and targets to open ten "X Member Stores" within this year. Hema "X Member Stores" adopt an operation mode that synchronizes online and offline services such as "half-day delivery" to provide better shopping experience for its members.
Airlines around the globe continue to be hampered by the ongoing pandemic. After downsizing twice since the pandemic started, Hong Kong Airlines' management is expected to announce the dismissal of most of its cabin crew this afternoon (23rd), in particular junior flight attendants, reported HK01, citing sources. The report added that after this round of layoff, there would remain only about 100 people in the airline's cabin service team.CANSINOBIO-B (06185.HK) announced that application has been made by the Company to the Stock Exchange for the resumption of trading in the H Shares from 1:00 p.m.
The Hong Kong market continues to show flexibility and tenacity amid the global pandemic, with financial and property industries especially benefited from the situation, reported BlackRock. BlackRock remarked that the financial industry has been hugely favored by the inflow of global capital and CNY appreciation, while the property industry continues to be supported by the rising property price induced by the structural demand shortage of Hong Kong. BlackRock believes that as Hong Kong continues to find no new confirmed local cases, travel restrictions between Hong Kong and places like Singapore, Macau and China is likely to be eased up, which will in turn be salubrious to the local economy. BlackRock suggested that the current regulatory cycle for certain technology stocks might last as long as few years, taking BABA-SW (09988.HK) as an example which was asked to submit self-compliance report to SAMR for three years. Meanwhile, e-commerce companies endeavor to identify the next growth driving force, meaning they need to invest in assets and infrastructure, which would inevitably results in hampered profitability. BlackRock, however, remains positive on the prospect of the Internet industry, but stressed that the company will be focusing its attention on small-mid scaled businesses, considering their lower risks to be involved in anti-monopoly investigations and stronger growth momentum. BlackRock recommended to keep tabs on short video companies or new generations of social network.
MELCO INT'L DEV (00200.HK) announced that a joint venture established between Melco Zhongshan (an indirect wholly-owned subsidiary of the Company) and Zhongshan Yachen (under AGILE GROUP (03383.HK)) succeeded in its bid for the land use rights in respect of Xisiwei, Nanlang Town (Qibu District, Cuiheng New District), Zhongshan at an acquisition price of RMB4 billion. The Development Project involves the development of mixed-use properties on the Project Land and is expected to include residential, commercial, recreational and entertainment elements, featuring ancillary facilities such as hotels, parks and green areas. Under the agreement, the Melco JV Parties shall be responsible for the development of a theme park to be constructed on the Project Land.
XIAOMI-W (01810.HK)'s outlook has been upgraded to positive with a "BBB-" rating to reflect the improving operating performance of the company as well as the projected promising cash flow in the coming 24 months, reported S&P Global Ratings. S&P maintains its optimistic take on the overall profitability of XIAOMI-W as the company continues to acquire market shares in the Chinese smart phone market and increase revenue from internet services.
Facebook (FB.US) announced to expand its Shops service to WhatsApp in various countries and the U.S. Facebook Marketplace. The Shops feature was launched last year, allowing users to search and purchase products on Facebook and Instagram, as a step of venturing into the e-commerce business.
CHINA DONGXIANG (03818.HK) announced the results for the financial year ended 31 March 2021. Net profit increased by 394.2% to RMB1.811 billion. EPS equaled RMB30.88 cents. A final dividend and a special dividend of RMB3.54 cents and RMB1.54 cents per share was declared, totalling RMB5.08 cents per share.
CANSINOBIO-B (06185.HK) spiked 10% this morning before trading being halted midway. National Medical Products Administration (NMPA)'s website revealed that the conjugate vaccine for type A and C meningococcal polysaccharide (CRM197 carrier) developed by the company was approved for market launch, with the issue date 22 June. The vaccine represented the third marketed vaccine product of the company following its Ebola and Covid vaccines.
HUTCHMED (00013.HK) (HCM.US), a biopharma company with CKH HOLDINGS (00001.HK) as its biggest shareholder, will fix its Hong Kong IPO price at $40.09 per share in order to raise $4.17 billion, IFR reported.Tencent Cloud under TENCENT (00700.HK) announced to have formed a strategic partnership with Guangdong (International) Hotel Management (GDHM) group and Hachi Intelligent Technology on 22 June, focusing on revamping the hotels under GDHM across the country into smart hotels. According to the agreement, Tencent Cloud will supply the core technologies, combined with the hotel managing and operating experience of GDHM along with the hardware and traffic advantage of Hachi, to smoothen the transition to digitalized and intelligence-based operation of the entire hotel industry.
The trading of CANSINOBIO-B (06185.HK)'s shares has been suspended at 10:16 am with reasons pending to be announced.
CANSINOBIO-B surged 10.6% before the trading halt, last posted $408, on a volume of around 772 million shares.
GEELY AUTO (00175.HK), once rallying 8% to peak at $26.95, last printed at $26.65, up 6.8%. Essence International said in its report that "ZEEKR 001" of the company posted strong beat of market feedback since its launch, where deliverable orders for 2021 were sold out. In the broker's view, the success of "ZEEKR 001" proved GEELY AUTO's tremendous capability in smart vehicle and advancement in broad platform. The broker retained the company's target price at $40 with rating kept at Buy. Essence International furthered the company packed the second half of the year with new car launches, predicting sales of "NULL" model in early July.
According to price lists and sales arrangements, all 95 unsold flats under The Pavilia Farm I and The Pavilia Farm II, both co-developed by NEW WORLD DEV (00017.HK) and MTR CORPORATION (00066.HK) atop Tai Wai Station, will be launched. 23 units come from phase I and 72 from phase II.
2,939 flats have been sold under The Pavilia Farm project (phase I to III) in nine months, representing over 95% of the project and pocketing nearly $36 billion.
Lina Khan, who prefers taking a tough stance against the technology conglomerates, is likely to review Amazon (AMZN.US)’s recent acquisition of the movie production company MGM, as she was sworn in as the chair of FTC last week, reported Reuters, citing sources. Amazon bought MGM this May at USD8.45 billion, in hope to compete with Netflix (NFLX.US) and Disney+.
Chinese media reported that Suning Real Estate will declare bankruptcy on 2 July, whereas 40% shares of Suning.com and Suning Logistics will be taken over by BABA-SW (09988.HK). In response, Suning said these were merely rumors. According to Suning Real Estate's official Weibo account, the company had called the police concerning online rumors and will seriously pursue the legal responsibility of rumor-mongers. The company urged the public not to spread and believe in rumors.
PRE MARKET HOURS NEWS
"Wealth Management Connect" could bring USD464 million of transaction fee revenue for banks every year, equaling to approximately HKD3.603 billion, reported Hong Kong Economic Journal, citing Bloomberg Intelligence. The biggest beneficiaries are expected to be the four major national banks, HSBC and HANG SENG BANK (00011.HK), as a result of their more developed branch networks in GBA.HUTCHMED (00013.HK) announced that on June 22, the Company received approval from the NMPA for savolitinib for the treatment of patients with NSCLC with MET exon 14 skipping alterations, which is conditional on the completion of a confirmatory study in this patient population.
HSBC clarified that Hong Kong clients are able to use the online and mobile banking services as usual when they are overseas and that the bank has no plan to alter said services.
The recent update of the terms and articles regarding the services is merely intended for the convenience of its clients, HSBC added as they apologized for the confusion caused.
EMPEROR INT'L (00163.HK) announced the results for the year ended 31 March 2021. The loss decreased to HK$767 million from HK$3.644 billion in the same period last year. LPS was HK21 cents. A final dividend of HK1.2 cents per share was declared. Together with the interim dividend, the total dividends for the Year are HK2.4 cents per share.
CKH HOLDINGS (00001.HK)'s statement disclosed that it repurchased 650,000 shares on the Stock Exchange on 22 June at $59.80-60.20 each, involving approximately $39.07 million. Year to date, the company bought back 7.4305 million shares, representing 0.1927% of the share capital of the company.
MIDLAND IC&I (00459.HK) issued a positive profit alert. It is expected that the Group will record a net profit for the six months ending 30 June 2021 as compared to the net loss of approximately HK$8 million for the six months ended 30 June 2020. The expected turnaround of the Group’s results was mainly attributable to the rebound of non-residential property market in Hong Kong in the first half of 2021.
While a number of automakers were beleaguered by chip shortage and forced to suspend production, GEELY AUTO (00175.HK) CEO Gui Sheng Yue told our reporters that he believed the company will not lag behind its fellows since it has been tying up with bellwethers across all walks of industries with many "decent acquaintances". In regards to the company's goal to sell 1.56 million vehicles this year, the CEO forecast that around 15% sales will be impacted due to insufficient chips in the first half of the year, conceding the company shoulders pressure in meeting the goal. Yet, he assured chip problem will be alleviated in the third quarter, paired with a wide range of popular new cars hitting the market in the second half, by which sales could be boosted and target be met.
It has debuted two key brands with a pivot towards new energy vehicles in recent years, namely Lynk & Co and Zeekr. As a battery electric vehicle brand, Zeekr will gradually set up experience stores for promotion in tier-1 cities said CEO Gui Shengyue, who is confident in the brand's ability to vie with new emerging powers. The BEV brand will start delivering cars from October and unveil future brand planning by then, added Gui.
Also the group has been building and producing necessary parts through joint ventures with partners, including battery JVs with CATL (300750.SZ) and LG Energy Solution, in hopes of engaging in high-tech development and taking the initiative.
Regarding market concerns about Jidu Auto, the group's JV with BIDU-SW (09888.HK), Gui suggested eyeing on their technological cooperation instead of distribution of the JV's equity interests. Geely he said must open up to the world, despite a bumpy road amid recent changes in Sino-Western relations, GEELY AUTO will vie with both European and American carmakers with the greatest products and a decent layout. Equally, the group has introduced the Geely brand to Eastern Europe through its Belarusian plant, while launching Lynk & Co in Europe with well-received response. The Chinese automaker will also debut its Zeekr brand in Europe going ahead. On another note, Gui said the A-share comeback upon Shanghai Stock Exchange's invitation will have no impact on the company's development.