Dongxing Securities released a research report noting that as of December 8, 2025, the transportation sector has underperformed the broader market among Shenwan's primary industries. Sub-sectors such as highways, railways, and ports—characterized by heavy assets and weak cyclicality—have lagged year-to-date, while cyclical segments like shipping and aviation have shown relative strength. The report highlights that anti-involution policies implemented in the second half of the year have positively impacted stock prices in cyclical transportation sectors.
**2026 Outlook: Prioritize Anti-Involution Beneficiaries and High-Certainty Stocks** The firm expects anti-involution policies and high-certainty investments to remain key themes in 2026, mirroring trends observed in late 2025. With heightened policy emphasis on curbing excessive competition, industries like aviation, express delivery, and regional shipping are poised for sustained benefits. In less cyclical sectors, high dividend yields and low leverage (or restrained capital expenditure) will likely attract investor preference.
**Express Delivery: Price Recovery and Profitability Restoration** Since anti-involution measures took effect, express delivery firms have seen improved profitability, driven by rising per-parcel prices. Aggressive price wars have eased, with leading players like ZTO Express-W (02057), YTO Express, and STO Express abandoning loss-making low-price segments. The sector is in an early upcycle, with competition expected to stay subdued amid slowing growth. Service differentiation is becoming a critical advantage.
**Aviation: Domestic Demand Recovery and Fare Growth** Airlines reported stronger Q2 2025 results, aided by lower fuel costs and disciplined capacity management. Cautious aircraft procurement is likely to persist into 2026, tightening supply further. Rising load factors and revenue per seat kilometer signal a shift from volume to fare-driven profitability, with major carriers offering superior earnings elasticity.
**Highways: High Dividends and Low Leverage in Focus** Highway stocks underperformed in H2 2025 due to plateauing bond yields and elevated valuations. Post-Q3 corrections, A-share highway stocks now offer better value, especially those with high payout ratios and manageable debt (e.g., Anhui Expressway, Guangdong Expressway, China Merchants Expressway). Investors favoring stable dividends may consider Jiangsu Expressway.
**Risks**: Policy shifts, macroeconomic slowdowns, oil price/currency volatility, and geopolitical uncertainties.
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