To The Moon

1. China’s market regulators are encouraging domestic fund managers to put their money where their mouths are in a bid to shore up confidence in the stock market.

At least 14 fund managers are expected to buy RMB 850 million of their own money to invest in equity #fund products. It’s a small, yet important symbolic move of support for the domestic market, which has been performing poorly as a result of investor worries over the economy. Chinese regulators reduced the fees for about 1,500 products last month, while contemplating reducing the #stampduty on stock transactions that would encourage more investors to participate in the market. $KraneShares Bosera MSCI China A 50 Connect Index ETF(KBA)$ $KraneShares CICC China Leaders 100 Index ETF(KFYP)$ $iShares MSCI China ETF(MCHI)$ $iShares China Large-Cap ETF(FXI)$

2. Anhui Conch Cement, one of the country’s largest cement producers, reported a steep 32% drop in 1H23 profits.

They earned RMB 6.76 billion during the period, a third less than the same period a year ago, and that’s despite revenues growing 16.3% to RMB 65.44 billion. The drop in net profit margins can be traced in part due to the weak market for #cement in China, which experienced a 17% drop in cement prices during the first half. Management gave a cautious outlook, stating the economic environment will be more complicated with new difficulties and challenges for the domestic economy. The lack of a forceful #stimulus from government both to save failing property developers and to boost infrastructure spending is contributing to this weak outlook. China’s cement industry will remain under pressure in the medium term. $Anhui Conch Cement Co., Ltd.(AHCHY)$ $CONCH CEMENT(00914)$

3. BYD Co. will open its first showroom in Tokyo, Japan this weekend and intensify its push into the world’s 2nd largest car market.

The showroom, located in the Toshima district, will showcase #BYD’s ATTO 3 model electric mid-sized SUV that’s equipped with the company’s patented Blade battery. The Blade battery has an optimized battery pack structure that increases the space utilization by 50% compared with conventional lithium-ion phosphate block batteries. It’s been proven safe even in the event of penetration or exposure to extreme heat. BYD plans to open as many as 100 showrooms in Japan by end-2025 and target the upper segment of the market to compete against Tesla and Audi. $BYD Co., Ltd.(BYDDF)$ $BYD COMPANY(01211)$ $Tesla Motors(TSLA)$ $Volkswagen AG(VWAGY)$

4. Chinese AI leader Baidu, Inc. announced 2nd quarter results that blew away expectations.

The company, which released its own AI-powered chatbot dubbed ErnieBOT reported a 15% increase in 2Q23 revenues to RMB 34.1 billion vs. RMB 33.3 billion expected. The company’s net income jumped 43% to RMB 5.2 billion, while its adjusted EPS of $3.11 compared with $2.32 expected by the market. Growth was driven by online marketing revenues (+15%) and its video-streaming business iQiyi (+17%). The company’s autonomous ride-hailing division, Apollo Go, witnessed a 49% increase in rides to 714,000, bringing the cumulative total rides to 3.3 million. Chinese consumers are becoming more and more comfortable with autonomous taxi services, which is set to see explosive growth in the coming years. $C3.ai, Inc.(AI)$ $iQiyi Inc.(IQ)$ $Baidu(BIDU)$ $BIDU-SW(09888)$

5. Li Auto sold 8,000 units of its electric vehicle models during the 3rd week of August, a record weekly tally.

This brings to 21,500 the total sales for the company in August, making it very likely they’ll exceed their 30,000 target with 10 days to go. The company cut prices for its EV models by RMB 15,000 to RMB 23,000 yesterday, as it joins the ranks of domestic EV brands engaged in another price war to keep market share and boost capacity utilization while Beijing’s supportive policies remain in place. This includes subsidies that will remain until end-2027, as China aims to reach 40% EV penetration by 2030. But with nearly 3 out of every 10 passenger vehicles sold in recent months being electrified, China will likely reach that target in a couple of years. $Li Auto(LI)$ $XPeng Inc.(XPEV)$ $XPENG-W(09868)$ $NIO Inc.(NIO)$ $NIO Inc.(NIO.SI)$ $NIO-SW(09866)$ $Geely Automobile Holdings Ltd.(GELYF)$ $Tesla Motors(TSLA)$