Glonghui, March 13 | Goldman Sachs published a research report stating that price competition in the logistics industry intensified in 2023, and the average express delivery service price declined and continued until the beginning of 2024. It is expected that the “Express Delivery Market Management Measures” implemented in March will increase “last mile” costs, which will help support average service prices. However, due to overcapacity in the industry and the market structure still scattered, the bank believes that the price of express delivery services is unlikely to continue to rise. On the positive side, the express package volume business has been showing a higher-than-expected trend since the beginning of the year. The year-on-year increase in the first two months was 29%, up from 27% in the fourth quarter of last year and 19% for the whole of last year. Currently, Goldman Sachs predicts that under continuous price competition, the average sales price of logistics companies operating mainly in the form of franchises will drop by 6% to 9% this year, and raise the industry package volume growth forecast from 10% to 14% this year. Goldman Sachs continues to be optimistic about Zhongtong Express. It is the only express delivery company that gives a “buy” rating, with a target price of HK$219; at the same time, it raised the Sinotrans rating from “sale” to “neutral” to reflect support for the normalization of dividend rates and freight rates, with a target price of HK$3.9. It also maintains a “neutral” rating for Kerry Logistics, with a target price of HK$11.1.