2Q26 results in line with our expectation

The firm announced its 2Q26 results: Revenue rose 14.4% YoY to Rmb4.23bn, and gross profit grew 7.5% YoY to Rmb449mn. Attributable net profit grew 9.6% YoY to Rmb197mn, in line with our expectations.

In 1H26, revenue rose 13.3% YoY to Rmb7.97bn, gross profit grew 7.3% YoY to Rmb865mn, and net profit grew 8.4% YoY to Rmb381mn. By business segment: 1) Global contract logistics business (MCL): Revenue rose 32.4% YoY to Rmb1.62bn, and gross profit grew 13.4% YoY to Rmb259mn; 2) Global international logistics business (MGL): Revenue rose 6.0% YoY to Rmb2.54bn and gross profit grew 16.0% YoY to Rmb315mn.

The distribution business (MCD): Revenue rose 12.4% YoY to Rmb3.80bn, and gross profit grew 3.7% YoY to Rmb280mn.

Trends to watch

For the first time, the company disclosed the proportion of revenue and gross profit by industry; new energy-related business performed well. In 1H26, chemicals and new energy accounted for 54% and 21% of its revenue, and made up 43% and 29% of gross profit.

MCL business growth accelerated. In 1H26, revenue and gross profit growth of the MCL business both picked up notably from 2.2% and 2.5% in 2025 to 32.4% and 13.4% in 1H26. The firm expanded its core competitiveness in chemical logistics to other industries. We think this factor helped its revenue and gross profit growth accelerate.

Financials and valuation

We keep our earnings forecasts largely unchanged. The firm is trading at 16.8x and 14.8x 2026e and 2027e P/E, 1x standard deviation below the average of the past three years. We believe the firm’s new incentive plan may unleash long-term growth potential. We maintain an OUTPERFORM rating and target price of Rmb79.14, implying 19.3x and 17.0x 2026e and 2027e P/E, offering 15.1% upside.

Risks

Falling transportation and warehousing prices; higher-thanexpected FX losses.