Investment Rating - The report assigns a "Buy" rating to the company with a target price of HKD 3.9 per share, indicating a potential upside of 22% from the current price of HKD 3.2 [5][10]. Core Insights - The company's total electricity sales volume for the first four months of 2025 increased by 0.33% year-on-year, with significant growth in wind and solar power generation, while hydropower saw a decline due to seasonal factors [7][8]. - The integration of hydropower assets is progressing smoothly, with the company expected to hold a 55.13% stake in Yuanda Environmental Protection post-restructuring, enhancing asset value and ensuring long-term control [3][8]. - The company has committed to a dividend payout ratio of no less than 50%, with a projected dynamic dividend yield of approximately 6% for 2025, reflecting a strong focus on shareholder returns [4][9]. Summary by Sections Financial Performance - For FY2023, the company reported revenues of RMB 44,262 million, with projections of RMB 54,213 million for FY2024 and RMB 55,346 million for FY2025, indicating a growth rate of 1.3% and 22.5% respectively [6][16]. - The net profit attributable to shareholders is expected to grow from RMB 2,660 million in FY2023 to RMB 4,338 million in FY2025, reflecting a compound annual growth rate of 28.9% [6][16]. Asset Management - The restructuring plan includes a significant increase in the company's stake in hydropower assets, with the National Power Investment Corporation planning to complete further asset integrations within three years [3][8]. - The estimated price-to-book (PB) ratio for the hydropower and new energy assets is 1.87, with a projected price-to-earnings (PE) ratio of approximately 20 for 2024 [3][8]. Dividend Policy - The company has a historical commitment to shareholder returns, achieving a dividend payout ratio of 60% in 2024 and aiming for a minimum of 50% in the future [4][9]. - The recent increase in shareholding by major stakeholders indicates confidence in the company's long-term investment value [4][9].

Economic Data - U.S. durable goods orders fell by 6.3% month-on-month in April[4] - Japan lost its status as the world's largest creditor for the first time in 34 years[4] - National industrial profits in China grew by 1.4% year-on-year from January to April[4] - The automotive industry in China reported revenues of 32,552 billion yuan, a year-on-year increase of 7%[4] Market Performance - The Nasdaq index rose by 2.47% to close at 19,199.16[5] - The Dow Jones Industrial Average increased by 1.78% to 42,343.65[5] - The S&P 500 index gained 2.05%, closing at 5,921.54[5] - The Hang Seng Index rose by 0.43% to 23,381.99[5] Bond Market - The 2-year U.S. Treasury yield decreased by 0.74 basis points to 3.974%[4] - The 5-year U.S. Treasury yield fell by 3.53 basis points to 4.033%[4] - The 10-year U.S. Treasury yield dropped by 6.25 basis points to 4.444%[4]

Economic Data - Baltic Dry Index closed at 1340.00, down 0.07%[2] - CME Bitcoin futures closed at 108370.00, down 2.75%[2] - ICE Brent crude oil price at 64.81, up 0.05%[2] - London gold spot price at 3342.21, down 0.46%[2] - USD/CNY exchange rate at 7.18, down 0.07%[2] Market Indices - Hang Seng Index closed at 23282.33, down 1.35%[4] - Hang Seng China Enterprises Index at 8437.64, down 1.70%[4] - Shanghai Composite Index at 3346.84, down 0.05%[4] - Shenzhen Composite Index at 1976.68, up 0.17%[4] - CSI 300 Index at 3860.11, down 0.57%[4]

Core Insights - The report highlights the extension of tariff negotiations between the US and EU until July 9, indicating ongoing trade tensions [4] - It notes significant developments in the US economy, including a temporary halt on Harvard's foreign student admission ban and a surge in Japan's rice prices by 98.4%, the highest since 1971 [4] - The report mentions that China's foreign investment absorption reached 320.78 billion RMB from January to April, reflecting a robust investment climate [4] - It also points out that sales of Chinese brand passenger cars in April reached 1.571 million units, marking a year-on-year increase of 23.5% [4] Economic Data Summary - The Baltic Dry Index closed at 1340.00, down 0.07% [5] - The Nasdaq Index closed at 18737.21, down 1.00%, while the Dow Jones Industrial Average closed at 41603.07, down 0.61% [5] - The ICE Brent crude oil price was reported at 65.03, up 0.92%, and the London gold spot price was at 3357.52, up 1.91% [5] - The USD/CNY exchange rate (CFETS) was 7.19, down 0.20% [5] - The Hang Seng Index closed at 23601.26, up 0.24%, while the Shanghai Composite Index closed at 3348.37, down 0.94% [5]

Investment Rating - The report assigns a "Buy" rating to the company with a target price of HKD 7.61, indicating a potential upside of 24% from the current price of HKD 6.14 [5][7][58]. Core Insights - The automotive steering system is transitioning from Electric Power Steering (EPS) to steer-by-wire (SbW) technology, which offers better responsiveness and safety features essential for advanced driving assistance systems (ADAS) and L3+ autonomous driving [5][30]. - The company's profitability is recovering, supported by a robust order book and strategic expansion into the steer-by-wire product line, which positions it competitively in the evolving automotive landscape [6][58]. - The company is expected to achieve significant revenue growth, with projected revenues of USD 4.47 billion, USD 4.77 billion, and USD 5.07 billion for FY2025, FY2026, and FY2027, respectively, reflecting year-on-year growth rates of 4.5%, 6.8%, and 6.2% [7][58]. Summary by Sections Company Overview - The company is a global leader in motion control technology, providing solutions for electric and hydraulic steering systems, steer-by-wire systems, and software solutions to over 60 customers, including major automotive manufacturers [16][21]. Transition to Steer-by-Wire - The shift from EPS to steer-by-wire is driven by the increasing demand for autonomous driving capabilities, with the technology expected to enhance vehicle safety and performance [30][31]. Recovery of Core Business - The company has seen a significant recovery in profitability, with net profit for 2024 projected at USD 61.72 million, a 68.1% increase from 2023 [6][38]. - The total order volume for 2024 reached USD 6 billion, with 31% of orders being new business, showcasing the company's competitive strength [41]. Financial Projections - The company forecasts revenues of USD 4.47 billion for FY2025, with a net profit of USD 121 million, representing a 96.2% increase year-on-year [58]. - The projected net profit margins are expected to improve, with net profit margins of 2.7%, 3.4%, and 3.7% for FY2025, FY2026, and FY2027, respectively [8][58]. Strategic Product Development - The company is expanding its steer-by-wire product portfolio, including the launch of rear-wheel steering (RWS) and electronic mechanical brake (EMB) systems, which are expected to enhance vehicle performance and safety [52][53]. - The EMB system represents a significant advancement in brake technology, replacing hydraulic systems with electronic controls for improved precision and integration [52]. Market Position and Competitive Advantage - The company maintains a strong market position in China, with a 16.16% market share in the EPS segment, ranking second in the domestic market [29]. - The strategic focus on software-defined vehicles (SDV) and collaboration with manufacturers enhances the company's ability to meet evolving market demands [36][37].

Economic Indicators - The U.S. manufacturing PMI rebounded strongly to 52.3, indicating expansion in the manufacturing sector[4] - China's total foreign direct investment reached $57.54 billion in the first four months of the year[4] - The total installed power generation capacity in China approached 3.5 billion kilowatts in the first four months[4] U.S. Treasury Market - The 2-year U.S. Treasury yield fell by 3.36 basis points to 3.986%[4] - The 5-year U.S. Treasury yield decreased by 7.44 basis points to 4.090%[4] - The 10-year U.S. Treasury yield dropped by 7.58 basis points to 4.529%[4] Stock Market Performance - The Nasdaq index closed at 18,925.73, up 0.28%[5] - The Dow Jones Industrial Average remained unchanged at 41,859.09[5] - The S&P 500 index closed at 5,842.01, down 0.04%[5] Commodity Prices - The price of ICE Brent crude oil fell by 1.36% to $64.03[5] - The spot price of London gold decreased by 0.60% to $3,294.49[5] - The CME Bitcoin futures rose by 2.21% to $111,365.00[5]

Economic Data - Global new energy vehicle sales exceeded 4 million units in Q1, marking a 39% year-on-year increase[3] - Japan's exports to the US declined for the first time in four months in April[3] Market Trends - 20-year US Treasury auction showed weakness, leading to declines in stocks, bonds, and currencies[3] - 2-year US Treasury yield rose by 4.90 basis points to 4.019%[4] - 10-year US Treasury yield increased by 11.56 basis points to 4.605%[4] Stock Market Performance - Nasdaq index closed at 18,872.64, down 1.41%[5] - Dow Jones Industrial Average closed at 41,860.44, down 1.91%[5] - Hang Seng Index closed at 23,827.78, up 0.62%[5] Corporate Earnings - XPeng Motors reported Q1 revenue exceeding expectations[2] - Baidu's Q1 revenue and adjusted operating profit also surpassed expectations[3]

Core Insights - The report highlights significant economic indicators, including a 2.1% year-on-year decline in China's tax revenue from January to April 2025, while non-tax revenue increased by 7.7% during the same period [4] - The report notes that the issuance of European bonds has surpassed €1 trillion at the fastest pace in history [4] - The Australian central bank has lowered the benchmark interest rate by 25 basis points to 3.85%, aligning with market expectations [4] Economic Data Summary - The Baltic Dry Index decreased by 2.95% to 1347.00, while the Nasdaq Index fell by 0.38% to 19142.71 [5] - The Dow Jones Industrial Average closed at 42677.24, down 0.27%, and the S&P 500 decreased by 0.39% to 5940.46 [5] - The Hang Seng Index rose by 1.49% to 23681.48, and the Hang Seng China Enterprises Index increased by 1.52% to 8589.08 [5] - The Shanghai Composite Index saw a slight increase of 0.38%, closing at 3380.48 [5]

2025 年 5 月 20 日星期二 【实时热点】 请务必阅读免责条款 1 证 券 研 究 报 告 微软发布一系列 AI 更新 【美国债市】 资料来源：BLOOMBERG、AASTOCKS、WIND、格隆汇、国元证券经纪（香港）整理 | 重要指数 | 收市价 | 涨跌(%) | 海外市场重要指数 | 收市价 | 涨跌(%) | | --- | --- | --- | --- | --- | --- | | 波罗的海干散货 | 1388.00 | 6.36 | 纳斯达克指数 | 19215.46 | 0.02 | | CME比特币期货 | 105780.00 | 1.30 | 道琼斯工业指数 | 42792.07 | 0.32 | | ICE布油 | 65.48 | 0.11 | 美元指数 | 100.37 | -0.60 | | 伦敦金现 | 3229.21 | 0.86 | 标普500 | 5963.60 | 0.09 | | 美元兑人民币(CFETS) | 7.21 | 0.12 | 日经225 | 37498.63 | -0.68 | | 香港重要指数 | 收市价 | 涨跌(%) | 内地重要指数 | ...

Core Insights - The report highlights that the U.S. retail sales in April exceeded expectations, indicating a stronger consumer spending trend [4] - Alibaba's Q1 revenue reached 236.5 billion yuan, with Alibaba Cloud revenue growing by 18%, showcasing robust performance in the technology sector [4] - Walmart's Q1 revenue was reported at $165.6 billion, which fell short of market expectations, reflecting challenges in the retail sector [4] Economic Data - The U.S. Producer Price Index (PPI) for April showed a year-on-year increase of 2.4% and a month-on-month decrease of 0.5%, both below expectations, indicating potential deflationary pressures [4] - The 2-year U.S. Treasury yield decreased by 7.95 basis points to 3.963%, while the 5-year and 10-year yields also saw declines, suggesting a shift in investor sentiment [4] - The Baltic Dry Index fell by 1.02%, indicating a decrease in shipping rates, which may impact global trade dynamics [5] Market Performance - The Nasdaq index closed at 19,112.32, down by 0.18%, while the Dow Jones Industrial Average rose by 0.65% to 42,322.75, reflecting mixed performance in the U.S. stock market [5] - The Hang Seng Index closed at 23,453.16, down by 0.79%, and the Shanghai Composite Index fell by 0.68% to 3,380.82, indicating a bearish trend in the Chinese market [5]