Investment Rating - The industry investment rating is "Buy" [1] Core Views - The performance of the eight major state-owned construction enterprises is under pressure, with revenue declining by 3.9% year-on-year in the first three quarters of 2024, and a 7.4% decline in Q3 2024. The net profit attributable to shareholders decreased by 9.8% in the first three quarters and by 15.2% in Q3 [1][12][13] - The cash flow situation is under pressure, with a significant increase in the cash payment ratio compared to cash receipts, indicating a worsening cash flow environment [1][8] - The report highlights the differentiation in performance among state-owned enterprises, with some showing resilience in cash flow and profitability, particularly in specialized engineering sectors [1][8] Summary by Sections Section 1: Performance Differentiation of State-Owned Enterprises - The report emphasizes the need to focus on asset recovery, overseas expansion, and equipment upgrades as new growth drivers for state-owned enterprises [1][8] Section 2: First-Level State-Owned Enterprises - The eight major state-owned construction enterprises achieved a total revenue of 5 trillion yuan in the first three quarters of 2024, with a year-on-year decline of 3.9%, which is less than the overall construction sector's decline of 4.9% [12] - In Q3 2024, their revenue was 1.6 trillion yuan, down 7.4% year-on-year, again outperforming the overall sector [12] Section 3: Second-Level State-Owned Enterprises - The second-level state-owned enterprises showed a mixed performance, with some companies like China Steel International and China Nuclear Construction improving their cash flow significantly [1][8] Section 4: Investment Recommendations - The report recommends focusing on state-owned enterprises with strong asset recovery potential and those benefiting from equipment upgrade policies, suggesting specific companies such as China Railway Construction and China Communications Construction [1][8]

Investment Rating - The report maintains a "Buy" rating for the real estate industry as of November 3, 2024 [2]. Core Insights - The real estate market is experiencing a downward trend in sales, with state-owned enterprises showing relative stability compared to private firms. In September 2024, the top 100 real estate companies achieved sales of 273.6 billion yuan, a year-on-year decline of 38.1%, with the decline expanding by 10.3 percentage points month-on-month [10][23]. - The market is expected to stabilize due to government policies aimed at preventing further declines, which may catalyze improvements in market fundamentals and corporate valuations [1][2]. Summary by Sections 1. Sales Performance - The sales performance of real estate companies is under pressure, with state-owned enterprises performing better than private firms. In September 2024, the sales amount for key listed companies was 181.4 billion yuan, down 40.3% year-on-year, with a month-on-month decline of 12.1 percentage points [10][23]. - The new opening absorption rate in key cities fell to a historical low of 38% in September 2024, indicating increased difficulty for companies in selling their inventory [12]. 2. Land Acquisition - There was a marginal improvement in land acquisition, with 44 sample companies acquiring land worth 32.6 billion yuan in September 2024, a month-on-month increase of 257% [2]. - The average gross profit margin for land acquisition among 12 major companies was 29%, reflecting an 8 percentage point increase month-on-month [2]. 3. Financing - Overall financing for real estate companies reached 150.4 billion yuan in September 2024, a month-on-month increase of 5% but a year-on-year decrease of 11% [2]. - The average financing cost for domestic bonds was 2.91%, reflecting a month-on-month increase of 44 basis points [2]. 4. Valuation and Investment Recommendations - The report notes a divergence in performance among real estate companies, with overall sector valuations recovering. The report suggests focusing on the continued recovery of fundamental performance and the valuation repair of key real estate companies [2][10]. 5. Price Trends - The average selling price for tracked companies in September 2024 was 17,417 yuan per square meter, a year-on-year decrease of 8.4% [16]. - The average selling price for the top 100 companies was 17,914 yuan per square meter, showing a year-on-year increase of 6.1% [16]. 6. Company Recommendations - The report includes a list of recommended stocks within the real estate sector, all rated as "Buy," indicating a positive outlook for these companies [5].

Investment Rating - The report maintains a "Buy" rating for key companies in the liquor industry, including Guizhou Moutai, Shanxi Fenjiu, and others [4]. Core Insights - The liquor industry is experiencing a downward trend in revenue growth due to weak demand during traditional peak seasons like the Mid-Autumn Festival and National Day. High-end liquor shows slight growth, while mid-range and other categories face significant declines [1][9]. - The overall revenue growth for high-end liquor companies remains stable, with Guizhou Moutai leading the sector. However, mid-range liquor is under pressure, and real estate liquor is facing substantial negative growth [2][9]. - Profit margins are generally stable, but there is a noticeable divergence across different price segments, with high-end liquor maintaining strong margins while mid-range and real estate liquor experience declines [2][23]. Summary by Sections 1. Q3 2024 Overview - Q3 is traditionally a peak season for the liquor industry, but this year has seen weak demand, leading to a continued decline in overall revenue growth. High-end liquor shows slight increases, while mid-range and real estate liquor face significant negative growth pressures [1][9]. 2. Financial Report Analysis (a) Volume and Price Performance - The overall production continues to decline, but the rate of decline is slowing due to improved competition dynamics. High-end liquor prices are under pressure due to weak demand in business and gifting sectors [13][14]. (b) Revenue Analysis - High-end liquor companies achieved a combined revenue of CNY 215.34 billion in the first three quarters, a year-on-year increase of 13.5%. In Q3 alone, revenue reached CNY 64.34 billion, up 9.6% [2][18]. - Mid-range liquor saw a revenue decline of 0.4% in Q3, while real estate liquor experienced a significant drop of 17.6% [2][19]. (c) Profit Analysis - The average gross margin for the liquor sector was 81.4% in Q3, showing a slight year-on-year increase. High-end liquor margins remain stable, while mid-range and real estate liquor margins are under pressure [23][25]. (d) Cash Flow and Advance Payments - Sales collection aligns with revenue trends, with high-end liquor companies showing strong performance. However, advance payments have decreased due to weak demand and low confidence among distributors [3][19]. (e) Performance Expectations - Profit forecasts have been generally downgraded due to weak demand, with high-end liquor expected to meet annual targets, while mid-range and real estate liquor face downward adjustments [3][19]. 3. Investment Recommendations - The report suggests that Q4 will be a slow season for liquor consumption, with expectations for a recovery in demand around the upcoming Spring Festival. Key recommendations include Guizhou Moutai, Shanxi Fenjiu, and others [3][19].

Industry Rating - The industry rating is **Buy**, maintaining the previous rating of Buy [1] Core Views - The sportswear and footwear downstream brand retail industry faced pressure in Q3 2024 but remained resilient, with domestic leading brands maintaining healthy and controllable inventory levels [2] - The upstream sportswear and footwear manufacturing industry continued to grow in Q1-Q3 2024, with some companies showing performance divergence in Q3 [3] Downstream Brand Retail Industry - In Q3 2024, Anta's main brand saw mid-single-digit year-on-year growth in retail sales, while FILA experienced low-single-digit decline [2] - Li Ning's main brand saw a mid-single-digit decline, while Xtep achieved mid-single-digit growth [2] - 361 Degrees' main brand offline sales grew by approximately 10%, and its children's line also grew by 10% [2] - Pou Sheng International's net operating income decreased by 10.8% year-on-year, and China Dongxiang's sales declined by high-single digits [2] - Overall, the sportswear brand retail industry saw a slowdown in Q3, primarily due to reduced foot traffic, but inventory levels remained healthy [2] Upstream Manufacturing Industry - In Q1-Q3 2024, the sportswear manufacturing industry achieved revenue of 67.07 billion yuan, a 10.6% year-on-year increase, and net profit of 4.25 billion yuan, a 20.4% year-on-year increase [3] - In Q3 2024, the manufacturing industry (excluding Shenzhou International) achieved revenue of 23.55 billion yuan, a 14.0% year-on-year increase, and net profit of 1.38 billion yuan, a 5.1% year-on-year increase [3] - Companies like Huali Group and Zhiqiang International saw growth in revenue and net profit, while Fengtai Enterprise and Yueqi International experienced declines [3] Investment Recommendations - For the downstream brand retail industry, focus on leading companies like Anta Sports, Li Ning, and Xtep International, which are expected to maintain high industry prosperity and healthy inventory levels [3] - For the upstream manufacturing industry, despite uncertainties in U.S. trade policies, leading companies like Huali Group and Shenzhou International are expected to maintain steady growth due to their strong competitiveness and global capacity layout [3] Market Performance - In Q3 2024, the sportswear brand retail sector slightly outperformed the Hang Seng Index, with the sector rising 19.9% compared to the Hang Seng's 19.3% [10] - The sector's performance was driven by government policies aimed at stimulating economic and consumption growth, which boosted investor confidence [10]

并购事件频繁落地。重点关注并购质地不错的新质生产力标的、显著提 [Table_Contacts] 升竞争力增厚业绩的产业链并购、集团优质资产注入等标的。 ⚫ 建议关注：（1）从供给约束到供给优化：资源品以油气（中国石油、 中国石油股份（H）、中国海油、中国海洋石油（H））、矿藏（钛精 矿-龙佰集团、磷矿-云天化&川恒股份）为代表；制造端以民爆（广东 宏大、易普力、江南化工、雪峰科技）、制冷剂（巨化股份）、铬化工 （振华股份）为代表；政策新线索关注设备更新和节能降碳；（2）新 技术、新材料、新趋势：合成生物、真空材料（赛特新材）、润滑油添 加剂（瑞丰新材）、半导体材料等；（3）涨价品种：维生素（新和成 等）。 ⚫ 风险提示：宏观层面：宏观经济下行，相关化工品的需求萎缩；行业层 | --- | --- | --- | --- | --- | |-------|--------------------------------------------------------------------------------------------------------------------------------- ...

Investment Rating - The industry investment rating is "Buy" [1] Core Viewpoints - The report highlights a significant increase in investment sentiment in the real estate sector, particularly in October, with strong performance from leading property companies [2][4] - Central and local governments are implementing policies to support home purchases for families with multiple children, aiming to stabilize the real estate market [12][13] - The report indicates a steady rise in new home sales, with a week-on-week increase of 18.5% in new home transaction area across 51 cities, although year-on-year figures show a decline of 8.5% [3][19] Summary by Sections 1. Industry Policy and Fundamentals Tracking - Central government policies emphasize the need for local authorities to enhance support for multi-child families in home purchases, including increasing housing fund loan limits [12][13] - The Ministry of Housing and Urban-Rural Development reported that new home sales and second-hand home transaction volumes increased month-on-month in October [12][13] 2. Key City Transaction Situation - In the week of October 25 to October 31, 2024, the monitored 50 cities recorded a total new home transaction area of 591.35 million square meters, marking an 18.5% increase from the previous week [19] - The report notes that first-tier cities saw a significant increase in transaction volumes, with Shanghai experiencing a 92.4% week-on-week growth [24] 3. Key Company Tracking - The report indicates that the top 100 property companies achieved a sales amount of 465.4 billion yuan in October, representing a 70% month-on-month increase and a 5% year-on-year increase, marking the first positive year-on-year growth since May 2023 [4] 4. Real Estate Development Sector Investment View - The report suggests that if the current supportive policies continue to be implemented, the market may see sustained positive sentiment and transaction volumes, benefiting companies with strong land reserves [4] 5. Property Management Sector Investment View - The property management sector is showing signs of recovery, with leading state-owned enterprises and non-default private companies experiencing stock price increases [4]

Investment Rating - The industry investment rating is "Buy" [1] Core Viewpoints - The coal industry performance in Q3 was generally stable, with expectations for improved electricity coal demand as the peak season approaches [2][40] - Recent market dynamics indicate a slight decline in port thermal coal prices, while the coking coal market remains weak and stable. The CCI5500 thermal coal price index decreased by 3 RMB/ton to 855 RMB/ton [2][8] - The report highlights that while coal prices have generally declined in Q2 and Q3, profit margins remain relatively stable, with most companies exceeding performance expectations in their Q3 reports [2] Market Dynamics - Thermal coal prices at ports have slightly decreased, with the CCI5500 thermal coal price at 855 RMB/ton as of November 1, 2024, down 3 RMB/ton week-on-week. The annual long-term contract price for November is 699 RMB/ton, unchanged month-on-month [2][8] - Domestic port coal prices have slightly declined, with weak downstream purchasing sentiment. However, some high-calorific coal prices in Shanxi and Shaanxi regions have increased due to temporary production halts [2][8] - The report notes that the overall coal inventory is sufficient, and with the arrival of winter storage demand, coal prices are expected to rebound gradually [2][8] Industry Outlook - The report anticipates that coal prices will remain stable or slightly increase due to rising winter storage demand and limited supply growth. The macroeconomic outlook is improving, which is expected to support coal prices [2][40] - The average dividend yield for the industry is projected to exceed 5% as of November 1, 2024, indicating significant valuation and dividend advantages for the sector [2] Key Companies - Key companies with stable profits and high dividends include Shaanxi Coal and China Shenhua [3] - Companies with low valuations and long-term growth potential include Yancoal Energy and China Coal Energy [3] - Companies expected to benefit from improved demand and production recovery include Huaibei Mining, Pingmei Shenma, Shanxi Coking Coal, and others [3]

Investment Rating - The report maintains a "Buy" rating for the construction industry [1]. Core Insights - The construction sector experienced a significant performance decline in Q3 2024, with a year-on-year revenue drop of 15.1%. The total revenue for Q1-Q3 2024 was 62,359 billion CNY, reflecting a 4.9% decrease compared to the previous year. In Q3 alone, the revenue was 19,859 billion CNY, down 8.3% year-on-year. The net profit attributable to shareholders for Q1-Q3 2024 was 1,385.5 billion CNY, a decline of 11.6%, with Q3 net profit falling by 15.1% to 401.4 billion CNY [1][7][8]. Summary by Sections 1. Construction Sector - The construction sector's performance was under pressure, with a 15.1% year-on-year decline in Q3 2024. The overall revenue for Q1-Q3 2024 decreased by 4.9%, while Q3 revenue saw an 8.3% drop. The net profit for Q1-Q3 2024 was down 11.6%, with Q3 net profit declining by 15.1% [1][7]. 2. Housing Construction Sector - Major player China State Construction saw a revenue decline of 14.5% and a net profit drop of 25.7% in Q3 2024. However, operational cash flow improved significantly, with a net inflow of 314.42 billion CNY, an increase of 324.90 billion CNY compared to the previous year [1][7]. 3. Infrastructure Sector - The infrastructure sector faced overall pressure, with Q1-Q3 2024 revenue down 4.5% and Q3 revenue down 4.2%. The net profit for Q1-Q3 2024 decreased by 11.8%, with Q3 net profit down 14.1% [1][7]. 4. International Engineering Sector - The international engineering sector showed strong performance in Q3 2024, with a net profit increase of 9.8% and an improved gross margin of 17.0%, up 1.6 percentage points year-on-year [1][7]. 5. Engineering Consulting Sector - The engineering consulting sector faced pressure, with Q3 revenue down 2.7% and net profit down 25.7% [1][7]. 6. Steel Structure Sector - The steel structure sector experienced an expanded revenue decline of 9.8% in Q3 2024, while the net profit decline was narrowed to 6.0% [1][7]. 7. Other Sectors - The chemical engineering sector showed improvement, while the landscaping and decoration sectors continued to incur losses [1][7]. 8. Investment Recommendations - The report suggests focusing on state-owned enterprises with stable dividends and improving performance, recommending companies such as China Communications Construction, China Railway Construction, and China State Construction. It also highlights opportunities in international expansion and sectors like mining services and water conservancy [1][7].

Investment Rating - The industry investment rating is "Buy" [1] Core Views - Revenue has shown a recovery with significant improvement in profit margins. The leading companies are experiencing a "Matthew Effect" where their market share is increasing due to better performance [1][21] - The report highlights that the demand is weakly recovering, with improvements in sales volume observed in September 2024. The consumer price index (CPI) and producer price index (PPI) are expected to stabilize [9][10] - The report recommends focusing on leading companies with improved operations and competitive advantages, such as Tianwei Food, Angel Yeast, Fuling Mustard, and Haitian Flavor Industry [1][21] Revenue Summary - Q3 saw a sequential improvement in sales, particularly in basic seasoning products. For instance, Haitian Flavor Industry's revenue increased by 9.83% year-on-year, while Q3 sales for Angel Yeast grew by 27.14% [1][17] - The report indicates that the sales volume of compound seasonings improved as the weather cooled, with Tianwei Food's revenue increasing by 10.93% year-on-year in Q3 [1][17] Profit Summary - The profit margins have significantly improved due to a reduction in raw material costs and a decrease in expenses. For example, the gross profit margin for Haitian Flavor Industry improved by 2.07% year-on-year in Q3 [23][24] - The report notes that the cost of key raw materials such as soybeans and sugar has decreased, contributing to better gross margins across the industry [23][24] Future Outlook - The leading companies are expected to continue gaining market share as they recover from previous adjustments. The report anticipates a gradual improvement in demand as the industry enters the peak season [21][22] - The report emphasizes that the competitive landscape is shifting, with fewer new entrants in the seasoning market, which may benefit established players [21]

Investment Rating - The report maintains a "Buy" rating for the communication industry [2][3]. Core Insights - The financial reports of four major cloud vendors indicate continued high growth in AI business and capital expenditures (CapEx). The demand for AI and the investment return paths are becoming clearer [7][8]. - Google reported a significant increase in cloud revenue, driven by AI infrastructure and solutions, with Q3 revenue reaching $11.35 billion, a year-on-year growth of 35.0% [7][8]. - Microsoft faces a capacity gap affecting cloud growth but remains optimistic about future AI returns, with Q1 FY25 intelligent cloud revenue at $24.09 billion, a 20% year-on-year increase [9]. - Meta's advertising business has seen substantial growth, with Q3 revenue of $40.589 billion, up 19% year-on-year, largely due to AI advancements [10]. - Amazon's AWS revenue reached $27.45 billion in Q3, a 19.1% year-on-year increase, with CapEx growing significantly due to AI demand [11][12]. Summary by Sections 1. Core Insights - The financial performance of major cloud vendors highlights the accelerating monetization of AI investments, with Google, Microsoft, Meta, and Amazon all reporting strong growth in their respective cloud and AI-related businesses [7][8][9][10][11]. 2. Market Review - The communication sector experienced a decline of 3.28% this week, underperforming the broader market [14]. However, year-to-date, the communication sector has outperformed the Shanghai Composite Index by 8.3% [14][17]. 3. Industry Data Updates - As of the end of 2023, China has built 3.377 million 5G base stations, a net increase of 1.065 million from the previous year, representing 29.1% of total mobile base stations [25]. - In September 2024, domestic smartphone shipments totaled 25.371 million units, a year-on-year decrease of 23.8%, with 5G smartphones accounting for 88.9% of total shipments [26]. - The number of 5G users in China reached 539 million by September 2024, with significant growth in IoT terminal users [28][30]. 4. Recent News - Apple is investing $1.5 billion in Globalstar to enhance satellite communication capabilities, which has led to a significant increase in Globalstar's stock price [37][38]. - Huawei reported a revenue of 585.9 billion yuan for the first three quarters of 2024, a year-on-year increase of 29.45% [39][40].