Shen Wan Hongyuan: Improving fundamentals during peak demand season, the two main expressways are expected to run throughout the year

The Zhitong Finance App learned that Shen Wan Hongyuan released a research report saying that the market style opens a balanced allocation window and focuses on railway companies' asset investment opportunities. In June, there was a concentrated outbreak of short-distance travel around Dragon Boat Festival and intercity commuting. The proportion of medium- and long-distance cross-regional travel declined, and the average travel mileage for a single passenger decreased. Under the upward trend in oil prices, domestic demand for long-distance guaranteed transportation across provinces is strong, continuing to increase overall freight turnover. The bank believes that the two main lines of investment in the highway sector are expected to run throughout the year, and that the traditional main line of high-dividend investment and potential market value management catalysts are worth paying attention to.

Shen Wan Hongyuan's main views are as follows:

The market style opens a balanced allocation window and focuses on railway companies' asset investment opportunities

Recently, market fluctuations have intensified and some capital has sought steady allocation targets. Capital liquidity has improved marginally, investors' uncertain expectations for the future have increased, equity risk premiums have also declined at the same time, and sector allocation value has become prominent.

Railway passenger traffic increased slightly, and passenger order distance shrank slightly

In June 2026, the national railway completed passenger traffic of 379.2 million people, up 1.6% year on year. The total number of passengers sent in January-June was 234.821 million, up 5.0% year on year; in June, the total passenger turnover completed 128.944 billion people kilometers, down 0.6% year on year. In January-June, the total passenger turnover was 826.682 billion people kilometers, up 3.4% year on year. The growth rate of passenger turnover was lower than the number of passengers sent, reflecting the concentrated outbreak of short-distance surrounding tours and intercity commuting at Dragon Boat Festival in June. The share of medium- and long-distance cross-regional travel declined, and the average travel mileage for a single passenger decreased.

Railway freight volume is under slight pressure, and freight turnover is greatly strengthened

In June 2026, the total freight delivery volume of railways across the country was 435.76 million tons, down 0.4% year on year. Total freight delivery in January-June was 2622.26 million tons, up 2.5% year on year; total freight turnover completed in June was 321,454 billion tonkm, up 9.2% year on year, and total completed freight turnover in January-June was 1885,81 billion tons/km, up 6.7% year on year. Freight turnover is stronger than cargo delivery volume, reflecting strong domestic demand for long-distance guaranteed transportation across provinces under the upward trend in oil prices, which continues to increase overall freight turnover.

Traffic fluctuated with the holiday season, and overall freight volume increased steadily

The weekly traffic volume of high-speed trucks in June 2026 was 54.349 million vehicles, 50.313 million units, 503.11 million units, and 54.793 million vehicles, corresponding to month-on-month changes of -1.85%, +1.22%, -8.55%, and +8.91%; in June, the country's road freight volume reached 377.544 million tons, an increase of 3.4% over the previous year.

Risk warning: risk of declining traffic, risk of production safety accidents in daily operation, risk of interest rate fluctuations.