China Securities Co., Ltd.: The Middle East is expected to become an important growth pole for the globalization of Chinese logistics enterprises. Key focus on J&T EXPRESS-W (01519) and JD LOGISTICS (02618).

China Securities Co., Ltd. released a research report stating that, in the medium to long term, the improvement of e-commerce penetration in the Middle East, normalization of cross-border trade, and completion of digital infrastructure will continue to drive growth in the express delivery industry. Chinese logistics companies, with their synergies with cross-border e-commerce, digital operational capabilities, cost control experience, and rapid adaptation capabilities to local conditions, are expected to continuously increase their market share. As terminal efficiency improves, sorting automation becomes more widespread, and economies of scale are realized, unit costs will gradually optimize, and profitability levels are expected to improve. The supportive policies of Gulf countries, consumer upgrades, and the development of standardized logistics will further open up growth opportunities for the industry, and the Middle East is expected to become an important growth pole for the globalization of Chinese logistics companies. Key focus on Chinese express delivery companies J&T EXPRESS-W (01519) and JD LOGISTICS (02618). The main points of China Securities Co., Ltd. are as follows: The e-commerce market in the Middle East has evolved from early domination by Amazon and Noon to a situation where multiple players are competing. In 2017, Amazon acquired the local platform Souq to enter aggressively, while Noon was founded by UAE entrepreneurs and the Saudi sovereign wealth fund, with their combined market share exceeding 50%. With the accelerated expansion of the "Four Little Dragons" of Chinese cross-border e-commerce, SHEIN, AliExpress, TEMU, and TikTok Shop quickly seized market share. In terms of order volume, SHEIN's unit price is about half of Amazon's, and its order volume has nearly caught up with Amazon, making it a core force in Middle Eastern e-commerce. The express delivery industry is the core infrastructure for the development of e-commerce in the Middle East. From 2019 to 2024, the compound annual growth rate of express delivery volume in the Middle East is approximately 23%, and the market size is expected to reach 570 million parcels by 2024, with e-commerce penetration and cross-border trade being the core drivers. The market has formed a three-tier competitive landscape: local giants dominate, with Aramex and various postal services accounting for approximately 40% of the market share by leveraging localized networks, cultural adaptation, and policy barriers to occupy high-end commercial parcels and large local orders. Chinese enterprises have quickly risen, with iMile, Jitui, Cainiao, Zhongteng, JD LOGISTICS, and others relying on the Chinese cross-border e-commerce ecosystem to combine cost advantages, cross-border coordination, and digital fulfillment capabilities, with a combined market share exceeding 40%, becoming the main driving force for industry growth. International players are focusing on high-end segments, with Amazon Logistics, DHL, UPS, FedEx, and others focusing on cross-border express delivery and enterprise-level high-end parcels, accounting for approximately 15% of the market share, capturing high-margin markets with a global network and efficient services. Major players in the Middle East market have their own characteristics and barriers. iMile was established in Dubai in 2017, focusing on serving Chinese cross-border e-commerce and targeting the pain points of high proportion of cash-on-delivery in the Middle East. It has built a "1+5+X" product matrix to provide cross-border direct mail, expedited express delivery, large parcel express delivery, returns, customs clearance, and other end-to-end services. As of October 2025, iMile covers 30 countries worldwide, with over 2,000 employees, making it a leading third-party express delivery company in the Middle East. Aramex, founded in Jordan in 1982, is a longstanding logistics leader in the Middle East, controlled by the Abu Dhabi sovereign wealth fund ADQ in 2025. Its business covers international express delivery, domestic express delivery, freight forwarding, and logistics supply chain, with a daily average of 350,000 to 400,000 parcels, with stable domestic business and a profit structure with a gross margin of 20% to 25%. Jitui Express entered the Middle East market in Saudi Arabia, the UAE, and Egypt in 2022, rapidly expanding with a low-price strategy, year-round delivery, high efficiency, and strong local promotional capabilities. Jitui focuses on the needs of cross-border e-commerce in the Middle East, with core customers including TEMU, SHEIN, and TikTok Shop. Ticket prices in Saudi Arabia, the UAE, and Egypt are significantly higher than those in Southeast Asia and China, with stronger profit resilience. JD LOGISTICS is based in Dubai, building an integrated supply chain network covering the six Gulf countries, Egypt, and Turkey, forming a four-wheel drive model of intelligent warehouses, local express delivery, cross-border trunk lines, and technical services. The company has set up 9 large warehouses in the Middle East and relies on JoyExpress's self-operated express delivery service to implement "211 express delivery" in Saudi Arabia.