Investment Focus - The report emphasizes the strategy of investing in stocks with high dividends and improved fundamentals, particularly in the essential consumer sector [1][6] - Key stocks recommended for investment include Kweichow Moutai, Wuliangye, and Yili, all rated as "Outperform" [1] Industry Overview - In May 2025, six out of eight tracked industries maintained positive growth, with the restaurant sector growing by 3.7%, beer by 3.3%, and soft drinks by 3.1% [3][8] - The industries experiencing negative growth include mass-market and above mid-range liquor, with declines of 13.0% and 2.5% respectively [3][8] Price Trends - In May, the price of Moutai continued to decline, while high-end products like Wuliangye stabilized [4] - The overall price trend in the liquor market showed more declines than increases, particularly in the mid-range segment [4][10] Cost Analysis - The cost index for soft drinks, seasonings, and other categories showed slight increases, while beer and instant noodles experienced declines [4] - Packaging material prices have decreased significantly compared to last year, with aluminum can prices up by 12.01% [4] Fund Flows - As of the end of May, net inflows into Hong Kong Stock Connect amounted to 41.99 billion yuan, with the essential consumer sector's market capitalization share at 5.65% [5] - The food additives sector saw an increase in market share, while the dairy sector experienced a slight decrease [5] Valuation Metrics - The PE historical percentile for A-share food and beverage stocks was 19% (21.5x), a decrease from the previous month [5] - H-share essential consumer sector PE historical percentile increased to 34% (18.8x), reflecting a rise in valuation [5] Recommendations - The report suggests waiting for opportunities or buying high-dividend stocks, as the current fundamentals lack catalysts for growth [6] - Key stocks with high dividend yields include Master Kong, Uni-President, and China Feihe, among others [6]

Investment Rating - The report does not explicitly state an investment rating for the industry or specific companies involved in EDA [1]. Core Insights - The new U.S. export restrictions on EDA software and technology to China are more comprehensive than previous regulations, affecting a broader range of integrated circuit levels without specific nanonode restrictions [2][7]. - Cadence and Synopsys reported revenues of $570 million and $990 million from China in fiscal year 2024, representing 12% and 16% of their total revenues respectively, indicating a significant market share in China [2][7]. - The restrictions are expected to lead to a short-term revenue decline for Cadence and Synopsys in China, but long-term impacts may be mitigated by growth in other regions [2][7]. - The restrictions may accelerate the localization of EDA tools in China, as seen with Huawei's progress in developing domestic EDA alternatives [3][8]. Summary by Sections Export Restrictions - On May 29, 2025, Cadence and Synopsys received notification from the U.S. Department of Commerce regarding new export restrictions that require licenses for EDA software and technology exports to China, particularly involving military end users [2][6]. - The new policy is broader than previous restrictions, which were limited to advanced nanonodes, now encompassing all integrated circuit levels from wafers to packaging [2][7]. Market Impact - Cadence and Synopsys, along with Siemens EDA, hold over 70% of the EDA market share in China, indicating their significant presence [2][7]. - Synopsys has already suspended services and sales in China and is assessing the impact of the new restrictions on its business [2][7]. Localization Opportunities - The export restrictions are seen as a catalyst for accelerating the domestic development of EDA tools in China, with Huawei achieving significant milestones in EDA software development [3][8]. - The localization efforts have progressed to the point where Huawei has independently mass-produced a 7nm chip, indicating advancements in EDA capabilities [3][8].

Core Insights - The report suggests that spot electricity prices may have bottomed out, leading to potential improvements in valuation and performance for the sector [1] - The analysis indicates that the electricity market is undergoing significant changes, particularly in the context of coal-fired power generation and renewable energy integration [3] Group 1: Coal Power - In northern regions, the proportion of renewable energy is higher, making coal power more scarce during peak times, which could lead to price increases [3] - The report anticipates that after three years of decline, the spot electricity price in Gansu will rise for the first time in 2025, surpassing long-term contracts [3] - In Q1 2025, coal power generation in China decreased by 4.7% year-on-year, with major state-owned enterprises experiencing significant drops in electricity output [21][22] Group 2: Hydropower - The report highlights that large hydropower resources are becoming increasingly scarce as most potential sites have been developed, particularly outside Tibet [35] - It is projected that hydropower prices will see a moderate increase during the 14th Five-Year Plan period, driven by further marketization [42] - Major hydropower companies are expected to show stable profit growth, with significant revenue from electricity sales [45] Group 3: Renewable Energy - The report notes that by 2024, the installed capacity of renewable energy in China reached 1.41 billion kilowatts, accounting for 42% of total installed capacity, with a compound annual growth rate (CAGR) of 27.4% from 2020 to 2024 [10][57] - The analysis indicates that the new energy policy aims to stabilize electricity prices and control the growth rate of installed capacity, suggesting a potential slowdown in future capacity additions [3] - The report also points out that the profitability of renewable energy is under pressure due to market dynamics, with significant declines in electricity prices observed in Guangdong [61][62]

Investment Rating - The report initiates coverage with an "Outperform" rating for CATL [2][6]. Core Views - CATL has maintained its position as the global leader in power lithium batteries since 2017, with a market share of 37.9% in 2024, significantly outpacing competitors [3][51]. - The company has a comprehensive supply chain layout that mitigates risks associated with raw material price volatility, ensuring control over critical resources [4][52]. - Heavy investment in R&D has led to a continuous stream of innovative products, enhancing CATL's competitive edge in the market [5][53]. - The financial forecast indicates substantial revenue growth, with projected revenues of RMB 460.9 billion, RMB 570.9 billion, and RMB 676.9 billion for 2025, 2026, and 2027 respectively [6][54]. Summary by Sections Company Overview - CATL was established in 2011 and became the global leader in power lithium batteries in 2017, with significant milestones including its listing on the Hong Kong Stock Exchange in 2025 [10][12]. Market Position - The company achieved a power battery installed capacity of 339.3 GWh in 2024, with a market share increase to 37.9% [3][24]. - The global demand for electric vehicles is expected to drive further growth, with projections of 22.4 million units sold globally by 2025 [23]. Supply Chain and Risk Management - CATL has established a robust supply chain through various strategies, including investments in upstream resources and partnerships for battery materials [4][39]. - The company has developed a circular economy model through its Brunp Integration Park, enhancing its resource recycling capabilities [4][42]. Financial Performance - The report highlights a significant increase in revenue from RMB 296.11 billion in 2018 to RMB 3285.94 billion in 2022, with a projected revenue of RMB 847.05 billion in Q1 2025 [12][18]. - The net profit is expected to grow from RMB 55.8 billion in 2025 to RMB 87.3 billion in 2027, reflecting a strong profit margin [6][54]. Valuation - Based on a DCF valuation model, the target price for CATL is set at HK$382, indicating a favorable investment opportunity [6][54].

Group 1: Market Recovery Insights - Key cities show better-than-expected recovery, with a 3% year-on-year decline in new residential sales in the first four months of 2025, compared to a national average of -2.8%[13] - After the 926 policy, the cumulative decline in the industry has narrowed significantly, indicating a positive trend in the market[6] - The supply-demand situation continues to improve, with sales area exceeding new construction area, completion area, and land acquisition area[16] Group 2: Policy and Economic Factors - The policy cycle is on an upward trend, potentially accelerating recovery, with the possibility of synchronized monetary policy cycles between China and the US[38] - The average loan interest rate for public housing funds in some cities has decreased to around 2.6%, making monthly payments comparable to rental levels, which supports first-time homebuyers[44] - The overall funding retention rate in the industry turned positive in March 2025 after 12 months of decline, indicating improved financial health[17] Group 3: Inventory and Construction Trends - As of April 2025, the monthly available housing inventory in 35 sample cities decreased by 5.5 million square meters from the peak in January 2022, with an inventory clearance cycle of 20.33 months[27] - New construction continues to decline, with total new starts in 2024 approaching levels seen in 2006, indicating a persistent supply shortage[31] - The construction area has decreased from 9.8 billion square meters in December 2021 to 6.2 billion square meters in April 2025, reflecting a significant contraction in the industry[19] Group 4: International Recovery Comparisons - Historical data shows that recovery cycles generally last longer than downturn cycles, with an average recovery period of 9 years compared to 6 years for downturns[73] - Factors such as urbanization rate, M2 growth, population growth, and GDP growth significantly influence the duration of recovery cycles[74] - Current urbanization rate in China is 67%, below the international benchmark of 75%, suggesting potential for further recovery in the real estate market[75]

Investment Rating - Investment advice: Positive on the long-term value of the property sector, recommending Onewo, China Resources Mixc Lifestyle Services, China Overseas Property Holdings, Poly Property Services, China Merchants Property Operation & Service, ChongQing New DaZheng Property Group [3][91]. Core Insights - The property management industry is facing profit challenges due to multiple adverse factors, leading to a phenomenon of "revenue growth without profit growth" since 2022. Key issues include pressure from parent companies, weakened real estate development investment, weak ability to increase property fees, and significant asset impairment [4][92]. - The industry is shifting from capital logic to operational logic, focusing on cash flows and returning to cyclical business characteristics, emphasizing basic property services [4][93]. - There are new opportunities in long-term revenue and cost management, with China's property fee burden being significantly lower than that of the US and Japan, indicating potential for growth [5][94]. Summary by Sections 1. Industry Challenges - The property management sector is experiencing a profit crisis due to several overlapping adverse factors, including downward pressure from parent companies and a decline in new project scales [4][10]. - The phenomenon of "revenue growth without profit growth" has become prominent among top property companies since 2022, with revenue growth slowing while gross and net profits have shown negative growth [17][92]. 2. Operational Focus - The industry is transitioning to an operational focus, emphasizing cash flow and basic property services, moving away from high-valuation mergers and acquisitions [4][93]. - Companies are optimizing their operational capabilities and focusing on core business models to enhance profitability [38][40]. 3. Market Dynamics - The competitive landscape is stabilizing, with leading companies solidifying their positions. The market is expected to see continued demand for property management services, particularly in non-residential sectors [5][94]. - The introduction of technology and robotics is anticipated to reduce costs and improve service models, providing new growth avenues [66][70]. 4. Financial Performance - The property management business is characterized by low profit margins, with gross margins around 15% and net margins declining, indicating a return to a cash flow-centric business model [50][47]. - The cash flow stability of property management contracts, typically lasting 3-5 years, enhances companies' resilience against market fluctuations [77][78]. 5. Future Outlook - The long-term outlook for the property sector remains positive, with potential for growth in service consumption and technological advancements driving efficiency [60][61]. - The sector is expected to maintain a robust business model, focusing on high cash generation and sustainable growth strategies [94][81].

Investment Rating - The report maintains a positive outlook on the Hang Seng Technology sector for the second half of the year, suggesting that the sector is worth focusing on due to the presence of many scarce quality assets [4][13]. Core Insights - The report highlights that the narrative of asset revaluation in China has gained momentum, leading to a rebound in Hong Kong stocks, although valuations remain relatively low. The uncertainty surrounding US-China trade negotiations may impact risk appetite and profit expectations, but domestic policy support is expected to drive fundamental recovery [8][13]. - Two main investment themes are suggested: 1. Companies benefiting from AI catalysis and upward fundamental trends, specifically Alibaba and Kuaishou. 2. Companies with solid business models and long-term barriers, actively expanding into overseas markets and food delivery, such as Meituan, Pinduoduo, and JD Group [3][13]. Summary by Sections Investment Recommendations - The report recommends focusing on the Hang Seng Technology sector, which is expected to perform well in the second half of the year due to improving fundamentals and capital conditions [4][13]. - Specific companies to watch include: - **Alibaba**: Expected continued growth in its cloud business and e-commerce, with a projected 12% year-on-year increase in CMR for Q4 FY25 [3][13]. - **Kuaishou**: Anticipated improvement in its e-commerce business due to strategic adjustments by Douyin [3][13]. - **Meituan**: Short-term investments are expected to solidify market share, with a long-term competitive advantage in food delivery [3][13]. - **Pinduoduo**: Focus on ecosystem building, with expectations of profit recovery in the second half of the year [3][13]. - **JD Group**: Strong performance in Q1 2025, with significant growth in active user numbers and order volumes [3][13]. E-commerce Trends - The e-commerce sector is shifting from price competition to differentiation, as major platforms adjust their strategies to focus on GMV rather than solely on price competitiveness [15][18]. - The report notes that Alibaba, JD, and Pinduoduo are all experiencing changes in revenue growth rates, with Alibaba and JD showing acceleration while Pinduoduo faces short-term profit pressures [22][30]. Local Services and Delivery - Meituan's core local business revenue is accelerating, attributed to reduced competition and improved departmental synergy [46][44]. - The report emphasizes the importance of food delivery as a business with strong network effects, with Meituan expected to maintain a solid competitive position despite short-term challenges [50][54]. Technology Investments - Alibaba plans to invest 380 billion RMB in AI and cloud computing over the next three years, with its cloud business showing strong growth driven by AI-related products [62][59]. - Kuaishou's AI capabilities are being enhanced with the launch of its upgraded models, which are expected to lead the industry in various performance metrics [63][65].

Investment Rating - The report maintains a positive outlook on the computer sector, indicating a recovery in industry prosperity driven by AI applications and technological independence [3][4]. Core Insights - 2025 is projected to be a pivotal year for AI applications, with significant advancements expected following the release of ChatGPT in late 2022. The report emphasizes that AI will become a key driver of business growth, enhancing efficiency and creating new demand [3][4]. - The report highlights the urgency for technological self-reliance in China, particularly in light of international trade tensions and tariffs that could impact the global technology supply chain [3][4]. - The computer sector is currently in its fourth bullish phase over the past decade, with a notable recovery in sentiment and performance expected [8][18]. Summary by Sections 1. Historical Overview of the Computer Sector - The computer sector has experienced four major bullish phases since 2013, with the current phase starting in September 2024 [8][18]. 2. Current Position of the Computer Sector - Institutional holdings in the computer sector remain low, with levels fluctuating around 2-6% over recent years. As of Q1 2025, holdings have slightly increased to 2.9% but are still considered low historically [15][18]. - The valuation levels of the SW computer index are at historical highs, indicating potential for further growth [18][21]. 3. Promising Sub-sectors and Logic for 2025 - The report identifies AI, technological independence, and the impact of tariffs as key areas of focus for investment in 2025. It notes that AI is transitioning from a follower to a leader in the global landscape, with domestic models closing the gap with international counterparts [38][43]. - The report anticipates that 2025 will mark the commercial rollout of AI agents, with significant advancements in AI capabilities expected [43][46]. - The report discusses the potential for mergers and acquisitions in the computer sector, driven by regulatory changes that may stimulate market activity similar to the 2013-2015 period [21][22]. 4. Company Performance Predictions and Valuations - The computer sector is expected to see a revenue increase in 2025, with a projected total revenue of 12,693.99 billion yuan in 2024, reflecting a year-on-year growth of 4.78%. However, net profits are expected to decline significantly [25][29]. - The report highlights that large-cap companies are showing more stable performance compared to small-cap companies, with significant growth in revenue and profits anticipated for large-cap firms in Q1 2025 [29][34].

Equity – Asia Research 全球变局：锚定"确定性" Global Shifts: Anchoring on Certainty 梁中华Zhonghua Liang zh.liang@htisec.com 周林泓Amber Zhou amber.lh.zhou@htisec.com 4 Jun 2025 本研究报告由海通国际分销，海通国际是由海通国际研究有限公司，海通证券印度私人有限公司，海通国际株式会社和海通国际证券集团其他各成员单位的证券 研究团队所组成的全球品牌，海通国际证券集团各成员分别在其许可的司法管辖区内从事证券活动。关于海通国际的分析师证明，重要披露声明和免责声明，请 参阅附录。(Please see appendix for English translation of the disclaimer) 投资要点 全球进入货币体系重构时代：全球经济体系重构的根源在于信任基础的变化，基于国际关系变化的信任下降，会导致整个全球 货币体系继续分化，重塑资产价格。"去美元化"确实在缓慢进行，主要是非经济因素主导，尤其是国际关系变化、各国信任度的 下降。在这个背景下，黄金的长期牛市需要站 ...

021-38676666 本报告导读： 登记编号 S0880525040005 证 券 研 究 报 告 扩内需、促消费是今年政策重点，3 月国务院印发《提振消费专项行动方案》。在特 朗普关税 2.0 背景下，内需的重要性愈加凸显。本报告通过对比中美消费相关数据， 以十张图表呈现我国消费特征。 投资要点： 总量研究 /[Table_Date] 2025.06.03 2025-06-04 十张图看清中美消费差异 [Table_Authors] 荀玉根(分析师) 研 究 专 题 研 究 [Table_Summary] 我国 GDP 中消费占比和贡献率较低。2024 年我国居民消费/GDP 为 39.9%，远低于同期美国的 67.9%，同样是人均 GDP 为 1.3 万美元 时，1980 年美国的居民消费/GDP 为 61.3%。 我国服务消费占潜力大。2024 年我国居民消费中服务消费占比 46.1%，但明显低于美国（68.5%）、法国（57.8%）、日本（57.7%）、 德国（51.4%）等发达经济体。 我国文化娱乐、金融保险消费支出占比明显偏低。我国居民消费中 食品、居住和教育占比较高。中/美/日居民消费中文化 ...