Growth story. With a strong corporate culture and a savvy management team, Jitu Express has made a series of breakthroughs in the express delivery field, becoming the only large-scale express delivery company with a large or dominant market share in Southeast Asia, China and new markets. Using its regional sponsor model, Jitu has demonstrated its ability to penetrate, compete, and outperform competitors in various markets while improving service quality, providing cost efficiency, and expanding business scale. Taking advantage of the long-term upward trend of e-commerce and a good operating record on the international stage, we believe that Jitu has unique advantages, can expand its moat and develop its business, and further create shareholder value in the long run.

Strong market position backed by execution. In 2022, in terms of package volume, GeeRabbit's market share in Southeast Asia was 22.5%, about three times that of second place. According to data from Frost & Sullivan, within a few years of entering China, Extreme Rabbit's package volume ranking rose to the top six, and was the fastest courier company to achieve a peak volume of 50 million packages per day. As the first major Asian express delivery company to enter a new market, Jitu continues to support and deepen ties with various e-commerce platforms in the structural transformation of the retail industry to online. With excellent execution, Jitu achieved strong package volume and revenue growth, with compound annual growth rates of 112% and 118%, respectively, in 2020-2022.

First rating: Better than the market. We expect extreme rabbit revenue to grow at a CAGR of 23%, while package volume will grow at a CAGR of 26% from 2023 to 2025. We expect a net loss of $725 million in 2023, a net profit of $315 million in 2024, and a net profit of $755 million in 2025. We used (1) EV/EBITDA to value each business unit of Jigutu, and (2) used the categorical summation valuation method to arrive at a target price of HK$14.70. Key risks include falling demand or unit prices for packages, increased competition, unstable or disrupted operating networks, and higher-than-anticipated costs associated with fuel, labor, equipment, and other inputs.