Investment Rating - The report maintains a "Buy" rating for Miniso, with a 12-month price target of $23.40 for ADR and HK$46.00 for H-share, indicating an upside potential of 27.9% and 33.1% respectively [14][17]. Core Insights - Management is confident in achieving revenue growth acceleration in 2025, targeting a year-over-year increase of 23% compared to 2024, with a focus on low teens percentage growth in Miniso China and around 40% growth in overseas markets [1][8]. - Despite expected margin pressure in the short term, management anticipates a return to positive operating profit growth by the third quarter of 2025, with a narrowing of margin contraction [1][2]. - The company plans to close 300-400 underperforming stores in China, with expectations of a return to net store count growth in the second half of 2025 [1][12]. Summary by Sections Financial Performance - For 2025, Miniso aims for revenue of Rmb20,554 million, with an operating profit (OP) target of Rmb3.6 billion to Rmb3.8 billion, compared to Rmb3.2 billion in the previous year [17]. - In 2Q25, management expects topline growth of 18%-21%, with specific growth rates of low teens for Miniso China and 25%-30% for overseas markets [8]. Market Strategy - The company is focusing on optimizing its product offerings in the US, with IP-related products making up 60-70% of sales, and plans to increase local sourcing to mitigate tariff impacts [12][15]. - Miniso's store expansion strategy includes targeting 80-100 net new store openings in 2025, with a significant portion being DTC stores [10][11]. Operational Efficiency - Management noted that logistics costs have declined, and there is potential for cost savings through improved store productivity and geographical concentration of store openings [10][12]. - The average payback period for new stores is reported to be 15-18 months, with daily sales averaging nearly Rmb10,000, significantly above the breakeven point [13].

Investment Rating - The investment rating for Huafeng is not explicitly stated in the provided documents, but there is a positive outlook on the company's performance and growth potential in the AI server market [2][4][8]. Core Insights - Huafeng's management is optimistic about the demand growth for high-speed line modules and backplane connectors for AI servers, expecting to ramp up production capacities in the second quarter of 2025 [1][4]. - The company is expanding its customer base to include more Chinese server brands and cloud service providers, indicating a strategic move to diversify its market presence [1][8]. - The positive outlook on Huafeng aligns with the broader positive sentiment regarding the China AI supply chain and advanced semiconductor nodes, suggesting a favorable environment for growth [2][4]. Summary by Sections Company Profile - Huafeng Tech (688629.SS) specializes in connectors and interconnection solutions for servers, industrial applications, and automotive sectors, with a focus on high-speed backplane connectors and line modules ranging from 10GB/s to 112GB/s [3][4]. Demand and Production Capacity - The demand for high-speed line modules is driven by the AI server market, with Huafeng's products currently in mass production for 56G and 112G applications, and development ongoing for 200G/224G products [4][9]. - The company has invested in six production lines for high-speed modules, with expectations for production to stabilize in the second half of the year as capacity ramps up [9]. Strategic Partnerships - Management sees potential for partnerships with Chinese server brands and cloud service suppliers, aiming to generate revenue from a more diversified customer base this year [8][9].

Investment Rating - The report assigns a "Buy" rating to GigaDevice, indicating a positive outlook for the company's stock performance [1][10][14]. Core Insights - GigaDevice is expected to enter a new growth cycle driven by product expansion into specialty DRAM, with strong EPS growth anticipated from market share gains in China [10]. - The NOR flash and MCU segments are projected to remain stable, with a modest recovery expected into 2025-2026 [10]. - The pricing for specialty DRAM has started to recover, driven by customer restocking and supply reductions as incumbents exit the legacy DRAM segment [4][10]. NOR Flash - Pricing for NOR flash is expected to be stable in 2025, with healthy near-term demand supported by consumption subsidies and increased content opportunities driven by AI [2]. - The automotive NOR flash market is projected to grow significantly, with a year-on-year increase of 40%-50%, although sales remain at a relatively low base [2]. MCU - MCU pricing is anticipated to remain largely stable in 2025, with growth driven by industrial customers' restocking demand and new market expansions [3]. - The automotive MCU sales are expected to take an additional year or two to reach meaningful scale due to the time required for product testing and qualifications [3]. Specialty DRAM - Specialty DRAM pricing has bottomed out and started recovering since March, with double-digit percentage increases observed in DDR4 8Gb and 4Gb products [4][7]. - Demand for specialty DRAM is expected to be bolstered by China's consumption subsidies on electronic products and new product expansions [7]. Customized DRAM - GigaDevice's customized DRAM leverages existing DDR4 production processes tailored to customer requirements, focusing on specialty applications such as automotive and industrial sectors [8]. - Revenue contribution from customized DRAM is expected to be limited in 2025 but could become more significant in the second half of 2026 to early 2027 [8]. Financial Projections - The revenue forecast for GigaDevice shows a growth trajectory from Rmb7,356 million in 2025 to Rmb14,200 million by 2027, indicating a compound annual growth rate [9]. - The expected EPS is projected to increase from Rmb1.65 in 2025 to Rmb5.17 by 2027, reflecting strong earnings growth [14].

27 May 2025 | 8:39AM HKT TechNet China 2025: AD/ ADAS solution solid delivery growth; balancing costs and advanced features We hosted iMotion's management on May 21 at our TechNet Conference China 2025. Overall, key discussions were around the company's product pipeline and business focus, as well as their strategy on chipset supplier partnership. Overall, iMotion obtained solid growth in its front view all-in-one systems and domain controllers, and is positive on their progress of customer development. Apa ...

Investment Rating - The report maintains a "Buy" rating for Shennan Circuits, with a 12-month target price of Rmb152, indicating a potential upside of 40% from the current price of Rmb108.6 [10][13]. Core Insights - Shennan Circuits is positioned as a key beneficiary of China's domestic AI infrastructure investments, expecting robust revenue and net profit growth as local equipment vendors increase their server and networking shipments [10]. - The overall PCB capacity utilization rate is reported at over 90%, with AI-related capacity running at full production due to strong demand from AI servers and networking [3][10]. - The company is facing rising raw material costs, particularly for gold and copper-related materials, but management plans to pass some of these costs onto customers due to high demand [2][3]. Summary by Sections Raw Material Costs - Gold-related raw materials prices are increasing, driven by rising gold prices, while copper-related materials also face high cost pressures [2]. - Gold-related materials account for less than 10% of total procurement at Shennan, allowing some flexibility in cost absorption [2]. PCB Outlook - The demand for PCBs is robust, particularly from local AI applications, including AI accelerators and high-speed optical transceivers [3]. - Management anticipates an improving gross margin outlook into Q2 and Q3 of 2025 due to a favorable product mix driven by AI demand [3]. ABF Business Status - The Guangzhou ABF plant incurred a pre-tax loss of Rmb550 million in 2024, but management expects losses to narrow in 2025 with improved cost control and revenue growth [4][7]. - Monthly depreciation costs at the Guangzhou ABF plant are projected to remain below Rmb30 million, with current costs at Rmb25 million [7]. Financial Projections - Revenue projections show a growth trajectory from Rmb17.9 billion in 2024 to Rmb26.7 billion by 2027, with net income expected to rise from Rmb1.9 billion to Rmb4 billion in the same period [8][10]. - The gross margin is expected to improve from 24.8% in 2024 to 27.2% by 2027, reflecting better operational efficiency and product mix [8].

Investment Rating - The report does not explicitly state an investment rating for the industry or specific companies covered [20]. Core Insights - The demand for power, water, and energy reliability and efficiency solutions is expected to increase, driven by a push to scale clean technology [8]. - Recent legislative changes, such as the House GOP tax bill revisions impacting IRA tax credits, are likely to influence the solar sector positively [8]. - Insights from corporate conversations and EU Green Capex meetings indicate a bullish outlook on green capital expenditures [8]. Summary by Relevant Sections - **Green Capex Field Trip**: The discussions highlighted the importance of scaling clean technology and the growing demand for energy solutions across major U.S. cities [1][8]. - **Legislative Impact**: The passage of the House GOP tax bill with revisions affecting IRA tax credits is a significant development for the solar industry [8]. - **Market Themes**: The report emphasizes the transformation of the global power grid and the investment opportunities arising from this shift [8].

Investment Rating - The report suggests maintaining relatively broad Dollar shorts, indicating a bearish outlook on the USD [1][18][20] Core Insights - The Dollar's weak response to fiscal developments is attributed to bad timing and persistent deficit financing needs, leading to concerns about foreign demand for US assets [1][5] - The report highlights a potential for a stronger CNY due to improved US-China trade relations and the undervaluation of the Yuan [4][12] - The Yen is viewed as a safe haven, with expectations that higher US yields will not significantly hinder its strength [12][18] - The KRW is expected to outperform other Asian currencies, supported by discussions of foreign exchange in US-Korea trade negotiations [13] - The RON is forecasted to weaken due to elevated current account deficits despite recent political stability [14] - The TRY is stabilizing after previous volatility, with expectations of gradual depreciation [15] Summary by Sections USD - The report notes that the Dollar's response to fiscal support and higher yields has been minimal, with a focus on the US's large deficit financing needs [1][5] - Investors are advised to maintain broad Dollar shorts, with EUR and JPY as attractive hedges against risk assets [1][20] CNY - The CNY has recently strengthened, with forecasts adjusted to 7.10 and 7.00 for 6-month and 12-month horizons respectively [4] - The report emphasizes the potential for a stronger Yuan as trade relations improve and the currency remains undervalued [4][12] JPY - The Yen is considered a safe haven, with expectations that fiscal concerns in the US will not significantly impact its strength [12] - The report suggests a preference for short AUD/JPY as a hedge during risk-off periods [12] KRW - The KRW is expected to benefit from a gradually strengthening CNY and discussions in US-Korea trade negotiations [13] - The report indicates that Korean policymakers are supportive of a stronger currency [13] RON - The RON is forecasted to weaken due to higher projected fiscal deficits and a delayed fiscal adjustment [14] - The report anticipates a controlled increase in EUR/RON forecasts over the next 12 months [14] TRY - The TRY is stabilizing after significant depreciation, with expectations of a gradual slowdown in depreciation rates [15] - The report adjusts USD/TRY forecasts higher, reflecting a more stable outlook [15]

Investment Rating - The report does not explicitly state an investment rating for the industry Core Insights - The report highlights ongoing pressures in global long-end rates, particularly influenced by rising Japanese 30-year yields, US fiscal issues, and high UK inflation, suggesting a cautious outlook for long-duration assets [1] - It emphasizes the importance of demand-side signals in the US Treasury market, indicating that the current fiscal trajectory may not significantly alter deficit expectations [2] - The report suggests that the UK long-end is still facing challenges despite some improvement in economic activity, with a recommendation to maintain long positions in 10-year Gilts versus US Treasuries [16] Summary by Sections Global Rates Overview - Global long-end rates are under pressure due to various factors including Japanese yields and UK inflation, with limited relief from trade risks [1] - The report suggests a preference for shorter maturities in the US Treasury market, indicating a shift in focus from long-duration assets [5] United States and Canada - The report discusses the impact of Moody's downgrade and fiscal package progress on US Treasuries, highlighting a lack of appetite to stabilize fiscal trajectories amid waning global demand [2] - It notes that the fiscal bill is unlikely to significantly change the deficit path, maintaining a steady increase in debt burden [2] Europe - The report indicates that trade uncertainty and fiscal expansion in Germany are contributing to a steep front-end of the European curve, with a preference for 5-year HICP longs [12] - It also mentions that sovereign credit remains favorable due to improved risk sentiment and fiscal policies, with expectations for Bonos to outperform BTPs and OATs [13] UK Market - The report highlights improving activity data in the UK but warns that inflation surprises could complicate the outlook for long-end Gilts [16] - It continues to recommend long positions in 10-year Gilts versus US Treasuries, reflecting a cautious but optimistic view on UK bonds [16] Japan - The report describes the long-end JGB sell-off as a potential indicator of broader global duration risks, with technical factors dominating the price action [19] - It suggests that fiscal concerns and rising inflationary pressures may lead to higher equilibrium rates, impacting global yields [19] Australia and New Zealand - The report notes a dovish pivot from the RBA, with expectations for multiple rate cuts this year, indicating a more benign inflation outlook [24] - It suggests that the current front-end of the AUD curve is fairly priced given these expectations [24] Forecasts - The report provides forecasts for G10 10-year yields, indicating expected movements across various currencies, with a focus on the US and UK markets [30]

Investment Rating - The report indicates a focus on improving the M&A environment in Japan, suggesting a positive outlook for the market [6][29]. Core Insights - The report highlights the ongoing commitment of Japanese regulatory bodies to enhance the M&A landscape, with significant revisions to corporate governance expected in the coming months [6][29]. - The report emphasizes the importance of protecting minority shareholders during M&A transactions, which is seen as a critical factor for accelerating M&A activities in Japan [6][29]. - The report notes that the recent increase in share buybacks has led to a rise in total dividend payouts, indicating a positive trend in corporate capital return strategies [18][19]. Summary by Sections Market Overview - The TOPIX index is currently at 2,735.52, reflecting a slight decrease of 0.2%, while the NK225 index is at 37,160.47, down by 1.6% [1]. - Key sectors performing well include non-ferrous metals and pharmaceuticals, while insurance and glass & ceramics are lagging [1][20]. Corporate Actions - There has been a notable net purchase of TSE Prime cash stocks by foreign investors amounting to ¥597 billion, while individual and institutional investors have net sold ¥222 billion each [3]. - The report mentions that the total amount of share buybacks announced in the second quarter has already surpassed the total for the entire second quarter of the previous fiscal year [2][13]. Earnings and Forecasts - The report provides earnings per share (EPS) forecasts for FY24 and FY25, with expected growth rates of 10% and 2% respectively [25][30]. - The average exchange rate assumptions for the yen against the dollar are set at ¥145 for FY25, indicating a potential impact on export-oriented companies [11][29]. Sector Performance - The pharmaceutical sector has shown a 3% increase over the past week, while the defense sector has also performed well with a 3% rise [20]. - The report lists various sectors with their respective performance metrics over different time frames, highlighting the best and worst performers [21][66].

Investment Rating - The report indicates a focus on the TMT (Technology, Media, and Telecommunications) sector, which is currently favored for investment during the summer [29]. Core Insights - The NDX (Nasdaq 100 Index) experienced a 2% decline last week due to mixed headlines and overbought conditions, with the index's 200-day moving average approximately 2.5% away [3][4]. - There is a notable downward trend in cyclical stocks, with the CYCS vs DEFS pair down 6 of the last 7 days, reflecting ongoing macroeconomic uncertainty and concerns about "pull forward" dynamics [4][6]. - Investors are increasingly focused on finding new long positions with real upside potential, particularly outside of mega-cap stocks, as the market shifts towards a services-oriented framework over goods [5][6]. - Upcoming earnings reports, particularly from NVDA (Nvidia), are expected to set the tone for the summer, with a reliance on earnings revisions rather than just multiple expansions to drive market upside [7]. Summary by Sections Market Performance - The NDX's recent performance shows a consolidation phase, with several charts indicating a search for support after recent declines [3][4]. - The semiconductor sector has also faced a downturn, with the SOX index down for seven consecutive days [4][8]. Investor Sentiment - A survey of institutional investors revealed that 37% consider trade policy the biggest risk for the summer, followed by concerns about US growth (26%) and the US deficit (23%) [23]. - 97% of respondents believe that a continued rise in backend yields could pose problems for equities, with significant attention on 10-year yield levels [26]. Sector Preferences - The TMT and Financials sectors are viewed as the most favorable for investment this summer, while consumer discretionary stocks are the least favored [29]. Future Outlook - The report emphasizes the importance of macroeconomic and tariff headlines as investors prepare for the second half of the year, focusing on companies that have managed to de-risk their outlooks in recent earnings reports [7].