Investment Rating - The report maintains a rating of "Outperform" for the industry, indicating a positive outlook compared to the broader market [5]. Core Insights - TSMC is expected to significantly increase its capital expenditure (Capex) to approximately $52-56 billion in 2026, up from $40.9 billion in 2025, reflecting strong demand in the computing and communication chip sectors [7][35]. - The launch of the Qianwen App, which integrates with Alibaba's ecosystem, is set to accelerate AI application deployment, potentially driving high growth in inference computing demand [7][40]. - The report highlights a robust long-term demand for computing power, with a focus on core segments of the computing industry, including optical modules, copper interconnects, switches, and AI applications [3][57]. Summary by Sections Industry Highlights - NVIDIA launched the next-generation AI computing platform, Rubin, which includes six new chips designed to enhance AI performance and efficiency [12]. - TSMC's expansion plans and partnerships with major tech companies like Apple and Google are expected to bolster the AI chip market [35][37]. - The domestic AI industry is entering a new phase of capitalized development, with several companies going public and increasing their market presence [39]. Market Review - The communication sector saw an overall increase, with the index rising by 3.1% over the past two weeks, ranking 14th among 31 sectors [2][48]. - The military communication, 5G, and industrial internet segments led the gains, with increases of 35.2%, 21.1%, and 21.0% respectively [2][52]. - Individual stock performance within the communication sector showed 110 stocks rising and 19 falling, with notable gains from companies like Shijia Technology and Xinke Mobile [2][56]. Configuration Recommendations - The report suggests focusing on key segments of the computing power industry, including optical modules, copper interconnects, switches, temperature control equipment, and AI applications [3][57].

Investment Rating - The report maintains an "Outperform" rating for the coal industry, indicating a projected performance that exceeds the broader market [2][14]. Core Insights - The coal prices are expected to rise before the Spring Festival due to a combination of cold weather and supply disruptions, making it difficult for prices to decline [7]. - The demand for coal remains relatively stable, with supply-side uncertainties increasing, particularly from Indonesia and Australia, which may lead to a tighter supply-demand balance [7]. - The report highlights that the average daily coal consumption has decreased slightly, but the upcoming cold wave is likely to push prices upward as demand increases [7]. Summary by Sections Supply and Demand Dynamics - A significant drop in temperatures is expected across many regions in China, which may impact coal consumption and prices [7]. - In December, coal imports reached 58.6 million tons, showing a year-on-year increase of 11.9%, but the total annual imports are projected to decline by 9.6% [7]. - Supply disruptions from Indonesia and Australia are anticipated, with Indonesian coal exports expected to drop significantly in January [7]. Price Trends - As of January 16, coal prices at Qinhuangdao port were reported at 697 RMB/ton, reflecting a slight increase compared to the previous week [7]. - The report notes that while daily coal consumption has decreased, the overall price trend is expected to be upward due to seasonal demand and supply constraints [9]. Recommendations - The report suggests focusing on companies such as Lu'an Huanneng, Yanzhou Coal, and Shanxi Coal International, which are expected to benefit from the anticipated price increases [9]. - For the long term, companies like China Coal Energy and Shenhua Group are recommended due to their robust dividend policies and operational stability [9].

Investment Rating - The report maintains a "Strong Buy" rating for the construction and decoration industry, indicating a positive outlook for investment opportunities in this sector [3]. Core Insights - The report emphasizes the gradual introduction of pro-cyclical policies, suggesting a focus on bottom-tier cyclical stocks and the low-altitude commercial aerospace industry chain, which is expected to accelerate its development by 2026 due to policy catalysts [2][8]. - The report highlights the significant improvement in the operating data of some central state-owned enterprises in Q4 2025, with notable increases in new contracts signed, indicating a recovery in construction demand [2][8]. - The report identifies three main investment lines: 1. Focus on key engineering projects in the western region during the 14th Five-Year Plan, benefiting central state-owned enterprises [9]. 2. Investment in high-demand sectors such as tunneling, civil explosives, and geotechnical engineering [22]. 3. Active investment in new economic directions such as commercial aerospace, low-altitude economy, computing power, and AI [23]. Summary by Sections Industry View and Investment Recommendations - The report suggests focusing on high-quality computing power, the low-altitude commercial aerospace industry chain, and bottom-tier cyclical stocks, supported by the central bank's policies aimed at stabilizing growth [16]. - The report notes that as of January 16, 2026, the cumulative net financing of special bonds reached 1,060.7 billion yuan, significantly higher than the same period in previous years, indicating a positive trend in financing for infrastructure projects [18][19]. Market Review - The construction and decoration index increased by 0.27% while the overall A-share index decreased by 0.45%, resulting in an excess return of 0.71 percentage points for the sector [15][28]. - The report highlights the performance of various sub-sectors, with other professional engineering (+4.04%) and steel structures (+1.45%) showing strong performance [15][28]. Key Company Dynamics - The report tracks significant company announcements, including contract signings and management shareholding changes, indicating active corporate governance and strategic movements within the industry [34]. - For instance, China Chemical announced a plan for management share reduction due to personal financial needs, while China Electric Power signed major contracts for international projects, reflecting ongoing business expansion [34].

Investment Rating - The report maintains a "Strong Buy" rating for the fiberglass sector, indicating a positive outlook for investment opportunities in this industry [2]. Core Insights - The report highlights a favorable policy environment that is expected to support the fiberglass sector's growth, particularly in 2026, with anticipated price increases for electronic fabrics due to supply constraints and high demand for mid-to-high-end products [7][11]. - The report emphasizes the importance of leading companies in the construction materials sector, which are expected to show resilience and profitability as the real estate market stabilizes [7][11]. Summary by Sections Cement - The cement market is entering a seasonal slowdown, with prices expected to decline as demand weakens ahead of the Chinese New Year. The average price is around 353 RMB/ton, with a decrease of 4.7 RMB/ton week-on-week [25][27]. - Southern regions are experiencing a temporary uptick in demand due to project completions before the holiday, while northern regions face declining demand due to cold weather [32][34]. Glass - Float glass prices have seen a slight increase, with an average price of 1,138 RMB/ton, while inventory levels have decreased by 4% week-on-week [35]. - The report anticipates a stable price environment for glass in the short term, with supply reductions expected to support price stabilization as the industry faces ongoing profitability challenges [44]. Fiberglass - The report notes that electronic fabric prices have increased, with the G75 electronic yarn priced between 9,300-9,700 RMB/ton, and the 7628 electronic fabric priced at 4.4-4.85 RMB/meter, reflecting a stable demand and supply situation [49]. - The fiberglass sector is expected to benefit from structural adjustments in product offerings, leading to a favorable supply-demand balance and potential price increases in 2026 [11][45]. Carbon Fiber - Carbon fiber prices are expected to remain stable in the short term, with the report highlighting the potential for increased demand driven by advancements in commercial aerospace [11][13].

Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for its stock performance relative to the market index [3][6]. Core Insights - The company signed new contracts worth 71.24 billion yuan in 2025, representing a year-on-year growth of 12%. The fourth quarter alone saw new contracts of 11.35 billion yuan, up 7% year-on-year. As of the end of 2025, the company had an order backlog of 66.46 billion yuan, reflecting an 11.3% increase year-on-year [1]. - The company is accelerating its overseas expansion, with new contracts in international markets reaching 45.02 billion yuan, a significant increase of 24% year-on-year. In contrast, domestic contracts decreased by 4% to 26.21 billion yuan, indicating a gradual reduction in domestic project drag [5]. - The high-end equipment segment saw a remarkable growth of 30% in new contracts, totaling 9.3 billion yuan, with mining equipment orders doubling to 1.69 billion yuan, a 129% increase [5]. - The company is expected to maintain growth during the "14th Five-Year Plan" period, supported by a strong order backlog and increasing overseas business, while domestic engineering drag is anticipated to lessen [5]. Financial Projections - The company is projected to achieve a net profit attributable to shareholders of 3.078 billion yuan in 2025, with growth rates of 3.2%, 6.2%, and 7.7% for the years 2025, 2026, and 2027, respectively. The corresponding price-to-earnings ratios are estimated at 8.99, 8.46, and 7.86 times [6][7]. - Revenue forecasts for the years 2024 to 2027 are as follows: 46.127 billion yuan (2024), 48.558 billion yuan (2025), 51.026 billion yuan (2026), and 54.354 billion yuan (2027), with growth rates of 0.72%, 5.27%, 5.08%, and 6.52% respectively [7].

Social Financing - In December 2025, the domestic social financing scale increased by 22,075 billion yuan, a year-on-year decrease of 6,462 billion yuan[1] - The new government bond issuance in December was 6,833 billion yuan, a year-on-year decrease of 10,733 billion yuan, primarily due to the earlier issuance schedule in 2025[5] - The total amount of new government bonds issued in 2025 was 13.84 trillion yuan, an increase of 2.54 trillion yuan compared to 2024[5] Loans and Deposits - In December 2025, non-financial companies and other sectors added 10,700 billion yuan in new RMB loans, a year-on-year increase of 5,800 billion yuan[10] - Fiscal deposits decreased by 1.38 trillion yuan in December, indicating a potential acceleration of fiscal funds into the real economy[10] - Resident household loans in December were negative at -916 billion yuan, reflecting weak consumer demand[15] Monetary Supply - M2 grew by 8.5% year-on-year in December, with an increase of 0.5 percentage points from the previous month, while M1 grew by 3.8%, down by 1.1 percentage points[16] - The M2-M1 gap widened to 4.7 percentage points, an increase of 1.6 percentage points from the previous month[16] Interest Rates - The central bank announced a structural interest rate cut of 0.25 percentage points, aimed at reducing financing costs for the real economy[20] - The weighted average interbank lending rate in December was 1.36%, down by 0.06 percentage points from the previous month[20]

Investment Rating - The report maintains a "Strong Buy" rating for the pharmaceutical and biotechnology sector, indicating a positive outlook for investment opportunities [3]. Core Insights - The pharmaceutical sector has shown a strong performance with a 7.81% increase in the index, outperforming the CSI 300 index by 5.03 percentage points, ranking 6th in industry performance [9][14]. - The report highlights significant growth in sub-sectors such as medical services and medical devices, with increases of 12.34% and 9.42% respectively [17][22]. - The report emphasizes the potential of small nucleic acid drugs, predicting a market valuation of $18.6 billion by 2029, with a CAGR of 29.5% from 2024 to 2029 [38]. - The upcoming JPMorgan Healthcare Conference is expected to showcase over 20 Chinese companies, with a focus on significant R&D advancements [39]. Summary by Sections Market Review - The pharmaceutical index increased by 7.81% this week, outperforming the CSI 300 index by 5.03 percentage points, ranking 6th in industry performance [14]. - The best-performing sub-sector this week was medical services, which rose by 12.34%, while traditional Chinese medicine had the smallest increase at 2.89% [17][22]. Individual Stock Performance - In the A-share market, 453 out of 478 pharmaceutical stocks rose, with the top five performers being Bibet (+68.89%), Innovation Medical (+61.04%), and Sanbo Brain Science (+56.15%) [25]. - In the Hong Kong market, 104 out of 116 pharmaceutical stocks increased, with the top performers including Zhaoyan New Drug (+30.76%) and Rongchang Bio (+28.51%) [29]. Industry News and Policies - The National Health Commission has outlined ten key initiatives for 2026, focusing on enhancing pediatric services and mental health care [32]. - The National Medical Products Administration has announced the establishment of two industry standards for brain-computer interface medical devices, indicating a regulatory push for this technology [32]. Weekly Insights - The report notes that the pharmaceutical sector is experiencing a "New Year Rally" driven by favorable policies for brain-computer interfaces and the launch of small nucleic acid innovative drugs [36]. - The report suggests monitoring companies involved in brain-computer interfaces, such as Chengyitong and Weisi Medical, as they are in the R&D phase [37].

Investment Rating - The report maintains an "Outperform" rating for the industry [3] Core Insights - The outdoor apparel market is experiencing rapid growth, with the company "伯希和" (Pelliot) positioned as a leading player in the high-performance outdoor lifestyle segment, achieving significant revenue and profit growth [2][54] - The outdoor sports industry in China is transitioning from a niche to a mainstream lifestyle, with a growing number of participants and increasing demand for high-performance outdoor apparel [28][27] - The report highlights the strong growth potential for domestic brands in the outdoor apparel market, driven by increasing consumer engagement and favorable market conditions [9][10] Summary by Sections 1. Outdoor Sports Market Evolution - The outdoor sports market in China is evolving from "niche exploration" to "mainstream daily life," with a significant increase in participation rates [18][20] - As of April 2025, the number of outdoor sports participants in China has surpassed 400 million, indicating a participation rate of approximately 30% [28] - The high-performance outdoor apparel market is the fastest-growing segment, with a projected CAGR of 15.5% from 2025 to 2029, reaching an estimated market size of 215.8 billion yuan by 2029 [36][37] 2. Company Overview: 伯希和 (Pelliot) - Founded in 2012, 伯希和 has rapidly expanded its business, achieving revenues of 1.77 billion yuan in 2024, a year-on-year increase of 94.5% [54] - The company has a strong focus on product development, marketing strategies, and channel distribution, which have contributed to its growth [2][54] - 伯希和 is positioned as the second-largest brand in the Chinese market for outdoor jackets and pants, with a market share of 3.9% [39][45] 3. Market Dynamics and Consumer Trends - The report indicates that the outdoor apparel market is benefiting from a shift towards lifestyle-oriented outdoor activities, with increasing consumer loyalty and purchasing power [31][28] - The demand for outdoor apparel is expected to continue growing, supported by favorable policies and a rising interest in outdoor activities among the population [9][10] - The report emphasizes the importance of product innovation and brand positioning in capturing market share within the competitive landscape [10][54] 4. Investment Recommendations - The report suggests focusing on diversified brands and companies that are likely to gain market share, particularly in the outdoor segment [10] - It highlights the potential for 伯希和 to become a leading player in the high-performance outdoor lifestyle market, especially with its upcoming IPO [10][54]

Investment Rating - The report maintains a "Buy" rating for the company [6] Core Views - The company reported a revenue of 1.26 billion yuan for the first three quarters of 2025, representing a year-on-year growth of 7.5%, and a net profit attributable to shareholders of 130 million yuan, up 13.7% year-on-year [5] - The production value of civil explosives in Tibet has shown a high growth rate, with a 38.67% increase year-on-year from January to November 2025, driven by key projects such as the 1.2 trillion yuan investment in the Yaxia Hydropower Station [5] - The gross margin improved by 2.41 percentage points to 29.32%, contributing to a net profit margin increase of 0.65 percentage points to 10.58% [5] - The company plans to acquire Heilongjiang Overseas Explosives, which is expected to significantly enhance production capacity [5] Financial Summary - The company’s total market capitalization is approximately 10.65 billion yuan, with a circulating market capitalization of about 10.61 billion yuan [4] - The company’s revenue projections for 2025-2027 are 1.82 billion yuan, 2.21 billion yuan, and 2.89 billion yuan, respectively, with growth rates of 7.68%, 21.21%, and 30.96% [7] - The net profit attributable to shareholders is projected to be 190 million yuan, 269 million yuan, and 393 million yuan for 2025, 2026, and 2027, respectively, with growth rates of 28.51%, 41.06%, and 46.36% [7] - The company’s earnings per share (EPS) are expected to be 0.69 yuan, 0.97 yuan, and 1.42 yuan for 2025, 2026, and 2027, respectively [7]

Investment Rating - The report maintains an investment rating of "Outperform" for the communication industry, indicating a positive outlook compared to the broader market [5]. Core Insights - The communication industry has shown resilience with a 2.6% increase in the index over the past two weeks, ranking 11th among 31 sectors [2][23]. - Valuation levels are considered high, with a dynamic price-to-earnings ratio of approximately 24.35 times as of December 31, 2025, compared to a historical average of 20.50 times [29]. - Key segments such as BeiDou, military communication, and 5G have experienced significant growth, with increases of 43.3%, 16.2%, and 11.6% respectively over the past two weeks [30]. - Major companies in the sector have seen substantial stock price increases, with top performers like 蘅东光 and 通宇通讯 rising by 878.2% and 32.9% respectively [31]. Summary by Sections Industry Dynamics - North American tech giants are actively engaging in mergers and acquisitions, which is expected to sustain the high demand in the computing power chain [13]. - The fiber optic cable industry is entering a price upcycle, driven by AI computing demand and advanced technology applications [17]. Market Review - The communication sector has outperformed the market over the past year, particularly between June and August 2025, with a notable 2.6% increase recently [23]. - The sector's performance is highlighted by the significant stock price movements of individual companies, with 86 out of 129 stocks rising [31]. Configuration Recommendations - The report suggests focusing on various segments including optical modules, copper interconnects, switches, temperature control equipment, and IDC facilities, as well as operators like China Mobile, China Telecom, and China Unicom [3][36].