ZTO EXPRESS-W Shrs Narrow Late-session Loss; CLSA: Mkt Share Recovery on Track; Outperform Rating Kept

ZTO EXPRESS-W (02057.HK) -5.900 (-3.278%) Short selling $283.01M; Ratio 25.113% once slumped 7.6% to a trough of HKD166.4 today (20th), before paring losses to close down 3.28% at HKD174.1, with 6.5752 million shares traded, involving HKD1.127 billion.In 1Q, ZTO EXPRESS-W recorded revenue of RMB13.282 billion, up 22% YoY. Net profit rose 6.3% YoY to RMB2.118 billion. Adjusted net profit increased 5.2% YoY to RMB2.377 billion.In a research report, CLSA noted that ZTO EXPRESS-Ws 1Q results were dragged by reduced government subsidies and tax rebates, but expected the company to maintain market share gains and stable unit profitability in the coming quarters. The broker maintained its Outperform rating on ZTO EXPRESS-W with a TP of HKD216.The report said 1Q revenue and gross profit grew 22% and 24% YoY, respectively, supported by stabilizing average selling prices and improved unit costs. However, net profit growth slowed to 6% YoY, mainly due to a combined reduction of about RMB320 million in government subsidies and tax rebates. Parcel volume increased 13% during the period, with market share rising 1.3 ppts. Core unit transportation and sorting costs fell by RMB0.04 and RMB0.02 YoY, respectively, benefiting from greater application of digital tools, higher loading rates, and deployment of automation and artificial intelligence (AI) technologies.CLSA said industry "anti-involution" has become the new normal, with competition shifting from pure pricing to overall service quality. Although industry parcel volume growth is expected to slow to single digits, the broker believes ZTO EXPRESS-W will continue to gain market share on the back of its pricing premium. The broker is confident in ZTO EXPRESS-Ws ability to regain market share in 2026 without compromising profitability, and expects its logistics network to be more financially resilient than peers, better positioned to cope with potential impacts from mandatory social security policies for couriers. (ad/j)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-05-20 16:25.)