Investment Rating - The report rates the defense and military industry as "outperforming the market" [4] Core Insights - The defense and military sector is experiencing a recovery in demand, with long-term growth certainty due to the completion of the 14th Five-Year Plan and upcoming construction goals for 2027 and 2035 [3][4] - The controllable nuclear fusion sector has shifted from thematic investment to trend-based industrial investment, supported by increasing global attention and domestic initiatives [1][36] - The low-altitude economy is in a dual resonance phase of policy support and accelerated commercialization of new products, indicating significant growth potential [2][35] Summary by Sections Market Review - The Shenwan Defense and Military Index rose by 2.13%, ranking third among 31 Shenwan primary industries, while the Shanghai Composite Index fell by 0.03% [1][11] - The current PE (TTM) for the defense and military sector is 75.26 times, with sub-sectors like aerospace equipment at 135.64 times and ground armaments at 136.23 times [21][4] Key Recommendations - Focus on downstream manufacturers such as Hongdu Aviation, AVIC Shenyang Aircraft, and AVIC Xi'an Aircraft [3] - Highlight new technologies in the military sector, including companies like Lianchuang Optoelectronics and Guangqi Technology [3] - Emphasize opportunities in underwater equipment and missile supply chains [3] Industry Dynamics - The report notes the increasing importance of controllable nuclear fusion, with multiple domestic projects underway and significant government support [36][37] - The U.S. has paused exports of critical components for the C919 aircraft, creating opportunities for domestic alternatives like the Changjiang-1000A engine [2][41] - The low-altitude economy is being bolstered by new policies and technological advancements, with significant investments in drone logistics and urban air mobility [32][35]

Report Summary - The report presents the top ten convertible bonds for June 2025, including their ratings, closing prices at the end of May, conversion premium rates, and trailing twelve - month price - to - earnings ratios (PE - TTM) of the underlying stocks [1][7][13]. Core Viewpoints - The report provides an in - depth analysis of the top ten convertible bonds in June 2025, highlighting the business profiles, financial performance, and key attractions of the issuing companies. Company - Specific Summaries 1. Zhongte Convertible Bond - Issued by a globally leading special steel manufacturer with an annual production capacity of about 20 million tons. In 2024, its revenue was 109.203 billion yuan (down 4.22% year - on - year), and net profit attributable to shareholders was 5.126 billion yuan (down 10.41% year - on - year). In Q1 2025, revenue was 26.84 billion yuan (down 5.59% year - on - year), and net profit attributable to shareholders was 1.384 billion yuan (up 1.76% year - on - year) [13]. - Key attractions include being one of the world's most comprehensive special steel enterprises in terms of variety and specification, having a complete industrial chain, and seeking external expansion opportunities [14]. 2. Shanlu Convertible Bond - Issued by a company mainly engaged in road and bridge construction and maintenance, with diversified business expansion. In 2024, its revenue was 71.348 billion yuan (down 2.3% year - on - year), and net profit attributable to shareholders was 2.322 billion yuan (up 1.47% year - on - year). In Q1 2025, revenue was 9.764 billion yuan (up 1.95% year - on - year), and net profit attributable to shareholders was 0.249 billion yuan (up 1.89% year - on - year) [22]. - Key attractions are having the concept of "China Special Valuation", potential improvement in balance sheet and order volume under debt resolution, benefiting from infrastructure construction plans in Shandong Province, and seizing Belt and Road opportunities [23]. 3. Guangda Convertible Bond - Issued by a company focusing on high - end equipment special steel materials and new - energy wind power components. In 2024, its revenue was 4.003 billion yuan (up 5.67% year - on - year), and net profit attributable to shareholders was 0.115 billion yuan (up 4.97% year - on - year). In Q1 2025, revenue was 1.122 billion yuan (up 25.75% year - on - year), and net profit attributable to shareholders was 0.074 billion yuan (up 1488.76% year - on - year) [33]. - Key attractions include the growing demand for wind power installation in 2025 - 2026, product structure optimization, and expansion of product applications [34]. 4. Aima Convertible Bond - Issued by the leading enterprise in the electric two - wheeler industry. In 2024, its revenue was 21.606 billion yuan (up 2.71% year - on - year), and net profit attributable to shareholders was 1.988 billion yuan (up 5.68% year - on - year). In Q1 2025, revenue was 6.232 billion yuan (up 25.82% year - on - year), and net profit attributable to shareholders was 0.605 billion yuan (up 25.12% year - on - year) [44]. - Key attractions are the potential continuation of government subsidies for trade - ins, the implementation of new national standards, and the potential improvement in gross margin [45]. 5. Xingye Convertible Bond - Issued by one of the first - batch joint - stock commercial banks in China, evolving into a modern financial service group. In 2024, its revenue was 212.226 billion yuan (up 0.66% year - on - year), and net profit attributable to shareholders was 77.205 billion yuan (up 0.12% year - on - year). In Q1 2025, revenue was 55.683 billion yuan (down 3.58% year - on - year), and net profit attributable to shareholders was 23.796 billion yuan (down 2.22% year - on - year) [54]. - Key attractions include stable growth in net interest income, stable asset quality, and continuous growth in scale and customer base [55]. 6. Yonghe Convertible Bond - Issued by a company engaged in the R & D, production, and sales of fluorochemical products. In 2024, its revenue was 4.606 billion yuan (up 5.42% year - on - year), and net profit attributable to shareholders was 0.251 billion yuan (up 36.83% year - on - year). In Q1 2025, revenue was 1.138 billion yuan (up 12.36% year - on - year), and net profit attributable to shareholders was 0.097 billion yuan (up 161.66% year - on - year) [67]. - Key attractions are the price recovery of refrigerant products, the stable performance of fluoropolymer products, and the profitability improvement of a subsidiary's project [68]. 7. Chongyin Convertible Bond - Issued by the earliest local joint - stock commercial bank in the upper reaches of the Yangtze River and Southwest China. In 2024, its revenue was 13.679 billion yuan (up 3.54% year - on - year), and net profit attributable to shareholders was 5.117 billion yuan (up 3.8% year - on - year). In Q1 2025, revenue was 3.581 billion yuan (up 5.3% year - on - year), and net profit attributable to shareholders was 1.624 billion yuan (up 5.33% year - on - year) [76]. - Key attractions are the development opportunities in the Chengdu - Chongqing economic circle, stable asset scale growth, and proactive risk management [77]. 8. Baidian Convertible Bond - Issued by a high - tech enterprise in the power distribution and control equipment field. In 2024, its revenue was 4.985 billion yuan (up 15.12% year - on - year), and net profit attributable to shareholders was 0.196 billion yuan (up 79.05% year - on - year). In Q1 2025, revenue was 0.976 billion yuan (up 4.68% year - on - year), and net profit attributable to shareholders was 0.037 billion yuan (up 11.47% year - on - year) [88]. - Key attractions are the potential improvement in profitability and a large number of outstanding orders [89]. 9. Huayuan Convertible Bond - Issued by a company focusing on the vitamin D3 industry chain. In 2024, its revenue was 1.243 billion yuan (up 13.58% year - on - year), and net profit attributable to shareholders was 0.309 billion yuan (up 60.76% year - on - year). In Q1 2025, revenue was 0.326 billion yuan (down 1.18% year - on - year), and net profit attributable to shareholders was 0.097 billion yuan (up 5.5% year - on - year) [101]. - Key attractions are leading products in the market, product expansion plans, and a focus on chronic disease drugs [102]. 10. Yushui Convertible Bond - Issued by the largest water supply and drainage integrated enterprise in Chongqing. In 2024, its revenue was 6.999 billion yuan (down 3.52% year - on - year), and net profit attributable to shareholders was 0.785 billion yuan (down 27.88% year - on - year). In Q1 2025, revenue was 1.652 billion yuan (up 8.66% year - on - year), and net profit attributable to shareholders was 0.237 billion yuan (up 28.91% year - on - year) [112]. - Key attractions are a stable monopoly position in the local market, business expansion, and effective cost control [113].

Investment Rating - The report assigns an "Outperform" rating for the industry, indicating that the industry index is expected to exceed market benchmarks in the next six months [10]. Core Insights - The commercialization of Robotaxi services is anticipated to take a significant leap forward, with Tesla set to launch its Robotaxi service in Austin, Texas, marking a milestone in the company's plans surrounding autonomous vehicles and AI [1][2]. - In the domestic market, major players in the Robotaxi sector, such as Baidu and Pony.ai, are experiencing substantial growth, with Baidu's "萝卜快跑" service providing over 1.1 million rides globally by May 2025, and a 75% year-on-year increase in Q1 ride services [3]. - The report highlights the emergence of non-passenger applications such as Robovan, Robosweeper, and Robotruck, which are extensions of the Robotaxi concept and are easier to implement [4]. Summary by Sections Overseas Developments - Tesla and Waymo are making significant strides in the autonomous driving sector, with Waymo achieving a weekly order volume of 100,000 rides in San Francisco within three months of full operation [2]. Domestic Developments - Baidu's "萝卜快跑" service has seen a 75% increase in ride services in Q1, while Pony.ai's operations cover over 2,000 square kilometers in major cities [3]. - 文远 Robotaxi reported a revenue of 16.1 million RMB, with a significant increase in its revenue share [3]. Non-Passenger Applications - Robovan, Robosweeper, and Robotruck are highlighted as key non-passenger applications, with companies like 九识智能 and 新石器 making substantial progress in orders and deliveries [4]. Related Companies - Key companies mentioned include 开勒股份 for Robotaxi, 数字政通 and 德马科技 for Robovan, 福龙马 and 玉禾田 for Robosweeper, and 北方股份 for Robotruck [5].

Investment Rating - The report gives a "Buy" rating for the company, indicating a positive outlook for the stock price in the next six months [5]. Core Views - The company's main business fundamentals are strong, with expectations for good performance throughout the year. In 2024, the company achieved total revenue of 828 million yuan, a year-on-year increase of 15.74%, while net profit slightly decreased by 0.58% to 47 million yuan due to increased R&D expenses and stock incentive plan costs [2][3]. - The company specializes in smart drive and control systems, with over 20 years of experience. Its products include various types of motors and controllers, and it has shown excellent performance in smart home and healthcare sectors [3]. - The smart linear drive industry is in an upward trend, and the company is expanding its business into new application areas such as humanoid robots, leveraging its experience in smart home and healthcare technologies [3]. Financial Summary - In 2024, the company reported total revenue of 828 million yuan, with a growth rate of 15.74%. The net profit was 47 million yuan, reflecting a slight decline of 0.58% [4]. - Revenue projections for 2025 to 2027 are 1.005 billion yuan, 1.189 billion yuan, and 1.368 billion yuan, respectively, with corresponding net profits of 109 million yuan, 132 million yuan, and 155 million yuan [4][12]. - The company’s earnings per share (EPS) are expected to increase from 0.26 yuan in 2024 to 0.85 yuan in 2027, indicating a positive growth trajectory [12].

Investment Rating - The report assigns an "Accumulate" rating for the company, indicating a positive outlook for the stock over the next six months [12]. Core Insights - The company achieved a revenue of 308 million yuan in Q1 2025, a year-on-year decrease of 5.79%, while the net profit attributable to the parent company was 27 million yuan, reflecting a year-on-year increase of 4.20% [1]. - The company is expanding its fiber masterbatch business, with new production capacity expected to be gradually released in the second half of 2025 [2]. - The company is diversifying its color masterbatch applications into non-fiber sectors such as film and high-end injection molding, which is anticipated to significantly increase the contribution from non-fiber business by 2025 [3]. - The company is advancing its COFs (Covalent Organic Frameworks) material project, with a target of 200 tons per year, and has begun small-scale verification sales [4]. Financial Summary - The company forecasts revenue growth from 1.36 billion yuan in 2024 to 1.88 billion yuan in 2027, with a compound annual growth rate (CAGR) of approximately 12.14% [5]. - The net profit attributable to the parent company is projected to grow from 114 million yuan in 2024 to 189 million yuan in 2027, reflecting a CAGR of 20.26% [5]. - The earnings per share (EPS) is expected to increase from 0.65 yuan in 2024 to 1.06 yuan in 2027 [5]. Market Data - The company's stock closed at 25.72 yuan, with a market capitalization of approximately 4.58 billion yuan [6]. - The stock has a 12-month price range of 20.94 to 37.40 yuan [6]. - The average daily trading volume is around 3 million shares [6].

Quantitative Models and Construction Methods 1. Model Name: Mamba-MoE - **Model Construction Idea**: The model integrates linear and nonlinear risk constraints into the training process, aiming to reduce risk exposure while extracting time-series features efficiently. It also employs cross-validation and multi-model ensemble to enhance robustness[2][43][166] - **Model Construction Process**: 1. **Time-Series Feature Extraction**: Utilizes the Mamba architecture, which is based on Selective State Space Models (SSM). The SSM equations are: $$ h^{\prime}(t) = A h(t) + B x(t), $$ $$ y(t) = C h(t) $$ where \( A, B, C \) are parameters representing state transition, input, and output matrices, respectively. The discrete form is: $$ h_t = \bar{A} h_{t-1} + \bar{B} x_t, $$ $$ y_t = C h_t $$ with: $$ \bar{A} = \exp(\Delta A), $$ $$ \bar{B} = (\Delta A)^{-1}(\exp(\Delta A) - I)\Delta B $$[16][19][20] 2. **Nonlinear Risk Constraints**: Incorporates nonlinear interactions between risk factors and stock-level relationships (e.g., industry and trading correlations) using graph neural networks (GNN). A heterogeneous graph is constructed with two types of edges: industry-based and high-similarity connections (correlation > 0.7 over a 30-day window)[43][48] 3. **Dual-Task Learning**: - Task 1: Generates alpha factors by extracting time-series features from stock data - Task 2: Creates nonlinear risk factors by modeling residual risks after industry and style neutralization[43][50] 4. **Loss Function**: $$ L = MSE(\hat{y}, y_1) + MSE(\hat{r}, y_2) + \frac{\alpha}{d_R + 1} \sum_{i=1}^{d_R + 1} \rho(\hat{y}, R_i)^2 $$ where \( \hat{y} \) is the alpha factor, \( y_1 \) is the industry-neutralized return, \( \hat{r} \) is the nonlinear risk factor, \( y_2 \) is the style-neutralized return, and \( R_i \) represents risk factors[50] 5. **Multi-Model Fusion**: Combines models using equal weighting or Mixture of Experts (MoE). MoE dynamically assigns weights to sub-models based on stock and market features, selecting the top \( K \) experts for aggregation[98][99] - **Model Evaluation**: The model demonstrates superior robustness and reduced risk exposure compared to single-task models. It effectively balances alpha generation and risk control[43][166] --- Model Backtesting Results 1. Mamba-MoE - **Rank IC**: 13.22% - **ICIR**: 1.28 - **Long-Only Annualized Return**: 33.01% - **Long-Short Sharpe Ratio**: 9.25 - **Long-Short Maximum Drawdown**: 12.21%[167][103] 2. Mamba-10 (Single Task) - **Rank IC**: 12.83% - **ICIR**: 1.28 - **Long-Only Annualized Return**: 30.06% - **Long-Short Sharpe Ratio**: 8.44 - **Long-Short Maximum Drawdown**: 11.71%[56][103] 3. Mamba-5 (Single Task) - **Rank IC**: 12.75% - **ICIR**: 1.32 - **Long-Only Annualized Return**: 31.21% - **Long-Short Sharpe Ratio**: 9.26 - **Long-Short Maximum Drawdown**: 11.31%[103] 4. Equal-Weight Fusion - **Rank IC**: 13.08% - **ICIR**: 1.29 - **Long-Only Annualized Return**: 31.76% - **Long-Short Sharpe Ratio**: 9.30 - **Long-Short Maximum Drawdown**: 11.97%[103] --- Quantitative Factors and Construction Methods 1. Factor Name: Nonlinear Risk Factor - **Factor Construction Idea**: Captures residual risks that cannot be explained linearly by existing risk factors, incorporating interactions and stock-level relationships[43][48] - **Factor Construction Process**: 1. Constructs a heterogeneous graph with two types of edges: industry-based and high-similarity connections (correlation > 0.7 over 30 days) 2. Applies graph convolution to aggregate edge and node information, generating nonlinear risk factors[48] 3. Combines these factors with original risk factors for further risk exposure control[50] - **Factor Evaluation**: Enhances the interpretability and effectiveness of risk control, reducing exposure to nonlinear risks[43][48] --- Factor Backtesting Results 1. Nonlinear Risk Factor (Dual-Task Model) - **Rank IC**: 12.83% - **ICIR**: 1.28 - **Long-Only Annualized Return**: 30.06% - **Long-Short Sharpe Ratio**: 8.44 - **Long-Short Maximum Drawdown**: 11.71%[56][60] 2. Nonlinear Risk Factor (Single Task, Original Label) - **Rank IC**: 13.09% - **ICIR**: 1.17 - **Long-Only Annualized Return**: 31.62% - **Long-Short Sharpe Ratio**: 7.72 - **Long-Short Maximum Drawdown**: 14.27%[56][60] 3. Nonlinear Risk Factor (Single Task, Neutralized Label) - **Rank IC**: 12.92% - **ICIR**: 1.22 - **Long-Only Annualized Return**: 29.49% - **Long-Short Sharpe Ratio**: 8.05 - **Long-Short Maximum Drawdown**: 12.45%[56][60] --- Index Enhancement Strategy Results 1. CSI 300 Enhancement - **Annualized Excess Return**: 9.02% - **Tracking Error**: 4.26% - **Excess Sharpe Ratio**: 2.12 - **Excess Maximum Drawdown**: 4.05%[156] 2. CSI 500 Enhancement - **Annualized Excess Return**: 11.63% - **Tracking Error**: 4.92% - **Excess Sharpe Ratio**: 2.36 - **Excess Maximum Drawdown**: 6.19%[156] 3. CSI 1000 Enhancement - **Annualized Excess Return**: 17.74% - **Tracking Error**: 5.52% - **Excess Sharpe Ratio**: 3.22 - **Excess Maximum Drawdown**: 6.17%[156]

Investment Rating - The report rates the industry as "Outperforming the Market" [5] Core Insights - Continuous progress in AI, with a focus on Agent, domestic computing power, and AIDC direction. The average stock price increase of representative agent companies is 76% from September 24, 2024, to May 23, 2025, indicating a positive trend [1][15] - The domestic humanoid robot sector is expected to see significant growth, with a notable influx of capital and government support, positioning it as a key area of investment opportunity [2][36] - The introduction of DeepSeek has accelerated AI integration across various industries, with over 70 partners developing DeepSeek integrated machines to meet diverse industry needs [1][48] Summary by Sections AI and Agent Development - AI applications are steadily advancing, with the potential for a commercial breakthrough in 2025. The report highlights the significant stock performance of agent companies and anticipates a fourth wave of AI market activity [15][32] - AI agents are expected to play a crucial role in sectors such as healthcare, education, government, and industry, driven by both bottom-up demand and top-down policy support [32][42] Humanoid Robots - The domestic humanoid robot industry is characterized by a significant expectation gap compared to the T chain, with most domestic players still in the early stages of development. The report identifies Huawei as a leader in this sector, leveraging its supply chain advantages [2][36] - The report outlines a tiered ranking of domestic humanoid robot companies, with Huawei leading, followed by Xiaomi and Xiaopeng, indicating a competitive landscape with substantial investment potential [2][36] AIDC and Computing Power - The report notes that major overseas companies have significantly increased their capital expenditures, with a combined total of 77 billion in Q1 2025, reflecting a 67.5% year-on-year growth. This trend is expected to resonate with domestic computing power demand [62][63] - The AIDC sector is projected to maintain high demand, with a focus on the performance of domestic computing power ecosystems and the overall AIDC industry chain [62][63]

Investment Rating - The report recommends a "Buy" rating for key companies in the automotive display industry, specifically BOE Technology Group and Tianma Microelectronics [4]. Core Insights - The automotive display industry is experiencing rapid growth driven by the transformation of the automotive sector, particularly with the rise of electric and smart vehicles. The demand for larger and multiple displays in vehicles is increasing significantly, with global shipments of automotive display panels expected to reach 230 million units in 2024, a year-on-year growth of 8.5% [1][44]. - Technological innovations such as OLED, Mini LED, and Micro LED are emerging, gradually gaining market share against traditional LCD technologies. OLED displays are particularly noted for their self-emissive properties and high contrast ratios, while Mini LED technology combines advantages of both traditional LED and OLED [2][36]. - The collaboration between automakers and display manufacturers is becoming increasingly direct, enhancing technological capabilities and production efficiency within the automotive display supply chain [3]. Summary by Sections 1. Automotive Display Reshaping Smart Cockpit Experience - Automotive displays serve various functions including driving assistance and entertainment, categorized by their installation locations such as instrument displays, HUDs, and central control screens [16]. - The automotive cockpit has evolved through several stages, from mechanical to electrical and now to intelligent systems, enhancing both functionality and user experience [21][29]. 2. Sufficient Growth Momentum for Automotive Displays - The global automotive market is recovering, with sales expected to reach 95.31 million units in 2024, and the electric vehicle segment is projected to grow by 26% year-on-year [44][46]. - The automotive electronics market is expanding, with the cost of automotive electronics expected to rise from 40% in 2021 to 60% by 2025 [47][49]. 3. Competitive Advantage of Mainland Display Manufacturers - Mainland Chinese manufacturers are gaining a competitive edge in the display panel market, with their share of the global 6th generation and above TFT-LCD panel capacity increasing from 9.79% in 2012 to 68.25% in 2023 [65][66].

Investment Rating - The report initiates coverage with a "Buy" rating for the company [3][5]. Core Insights - The company's revenue for Q1 2025 reached 380 million yuan, representing a year-on-year growth of 42.18%, while the net profit attributable to the parent company was 114 million yuan, up 276.64% year-on-year [1]. - The establishment of the Vietnam base is expected to be a core driver of the company's performance growth, especially in the context of increased tariffs on exports to the U.S. [2]. - The company has successfully launched production lines in Vietnam, which will help maintain and expand its market share in developed countries [2]. - The company is a leader in the domestic UHMWPE fiber market and is exploring new applications in various fields [3]. Financial Summary - The projected revenues for 2025, 2026, and 2027 are 2.59 billion yuan, 2.69 billion yuan, and 3.14 billion yuan, respectively, with corresponding net profits of 280 million yuan, 233 million yuan, and 302 million yuan [4][12]. - The company is expected to achieve a net profit margin of 10.8% in 2025, increasing to 9.6% by 2027 [12]. - The earnings per share (EPS) is projected to be 1.74 yuan in 2025, 1.45 yuan in 2026, and 1.87 yuan in 2027 [12].

Investment Rating - The report initiates coverage with an "Accumulate" rating for the company [9]. Core Views - The company has established itself as a leader in the specialty surfactants sector, with an annual production capacity of nearly 300,000 tons and a diverse product range across 17 segments, including functional new material resins and high-end electronic chemicals [1]. - The company is experiencing steady revenue growth and improved profitability, with a projected 27% year-on-year increase in specialty surfactant sales for 2024, reaching 179,000 tons [2]. - The company is actively advancing its "Third Factory" project, which aims to produce 330,000 tons of high-end functional new materials, with the first phase expected to begin trial production in the first half of 2026 [2][3]. Financial Summary - For 2024, the company anticipates revenue of 23.3 billion yuan, a 23.17% increase from the previous year, with a gross margin of 24.95% [2]. - The net profit attributable to the parent company is projected to be 398 million yuan for 2024, reflecting a 22.5% year-on-year growth [2]. - The company forecasts net profits of 475 million yuan, 569 million yuan, and 673 million yuan for 2025, 2026, and 2027, respectively, indicating a consistent growth trajectory [3]. Market Data - As of May 23, 2025, the company's closing price was 12.45 yuan, with a total market capitalization of approximately 7.33 billion yuan [5]. - The stock has shown a 12-month price range between 8.09 yuan and 13.86 yuan [5].