Core Insights - The report emphasizes the long-term positive trend in the military industry due to escalating great power competition and increased defense spending in response to regional tensions [7][17][20] - The report highlights the significant growth in the scale of credit bond ETFs, with a total scale of 1,066 billion yuan as of June 20, 2025, reflecting a substantial increase since March [2][34] - The report identifies potential investment opportunities in low-valued newly issued sci-tech bonds, suggesting that there is still room for exploration in the primary market [4][37] Group 1: Credit Bond ETF Insights - The expansion pace of index constituent bonds is significantly slower than the growth of credit bond ETF scale, with the scale increasing by 777 billion yuan since March [2][34] - The report notes that the duration of Shenzhen credit bond ETFs is 3.05 years, while Shanghai credit bond ETFs have a duration of 4.11 years, indicating a shift in demand towards mid to long-term credit bonds [3][35] - The report suggests that the low valuation transactions in constituent bonds are becoming more prominent, particularly for those with larger outstanding scales and stable valuations [2][34] Group 2: Military Industry Insights - The military sector experienced a decline recently, with the defense industry index dropping by 2.39% in the week of June 15-20, 2025, underperforming the broader market [8][19] - The report highlights the successful launch of the Zhongxing 9C satellite and the showcasing of advanced military equipment at the Paris Air Show, including the J-35A stealth fighter [8][19] - The report indicates that the ongoing international military dynamics underscore the importance of national defense construction, with a focus on advanced technology and informationization in modern warfare [20]

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - The expansion rhythm of index constituent bonds is significantly slower than the growth rate of credit bond ETF scale. Amid the bond - snatching market, low - valuation transactions of constituent bonds emerge. There are three aspects to consider: "far", "发", and "扩". "Far" involves the conduction mechanism of corporate bond - China Securities - China Bond interest rates; "发" means that buying in the primary market can still be profitable during the bond - snatching period; "扩" refers to the analysis of constituent bonds benefiting from the issuance and expansion of science and technology innovation bond ETFs [1]. Summary According to the Table of Contents 1. Review of the Bond - Snatching Market Driven by the Expansion of Credit Bond ETFs - As of June 20, 2025, the total scale of 8 benchmark market - making credit bond ETFs reached 106.6 billion yuan, an increase of 77.7 billion yuan compared to the end of March, with a 41.7 - billion - yuan increase since June. The expansion rhythm of index constituent bonds is significantly slower than the growth rate of credit bond ETF scale. In the Shanghai market - making aspect, the scale of Shanghai - based benchmark market - making ETFs accounts for 11.0% of the credit bond index constituent bonds, a 4.5 - percentage - point increase compared to the end of May. In the Shenzhen market - making aspect, it accounts for 12.4%, a 4.8 - percentage - point increase compared to the end of May [1][3]. - During the bond - snatching market, low - valuation transactions of constituent bonds emerge. ETF product preferences lean towards constituent bonds with larger outstanding scales and higher valuation stability. For example, in the Shanghai market, the number of low - valuation transactions and transaction amounts of the top 3 constituent entities have significantly increased since June, with an average low - valuation amplitude of - 1.7BP, a 1BP increase compared to May, and the transaction amount from June 1 to June 20 was 5.37 billion yuan, a 1.61 - billion - yuan increase compared to the whole of May. In the Shenzhen market, trading volume has increased significantly since the second quarter, with an average low - valuation transaction amplitude of - 4.5BP in June, a 0.9BP increase compared to May, and the transaction amount from June 1 to June 20 was 3.94 billion yuan, a 1.26 - billion - yuan increase compared to the whole of May [1][7]. 2. Game "Far": The Conduction Mechanism of Corporate Bond - China Securities - China Bond Interest Rates - The impact of low - valuation transactions on bond valuations is mainly reflected in two dimensions. Firstly, the valuation divergence between exchange - traded corporate bonds and comparable inter - bank bonds. For example, the valuation difference between 24 Zhonghua 16 and its comparable inter - bank bond 25 Zhonghua MTN001 was within 2BP before the end of May, but has widened to 7BP since June. Secondly, the impact of the surge in credit bond ETFs on the yield curve. The duration of Shenzhen credit bond ETF is 3.05 years, and that of Shanghai credit bond ETF is 4.11 years. The surge in credit bond ETFs boosts the allocation demand for 3 - 5 - year credit bonds, flattens the yield curve, narrows the credit spreads of medium - and high - grade bonds, and drives down the overall valuation of high - grade credit bonds [1][12]. 3. Game "发": Buying in the Primary Market Can Still Be Profitable During the Bond - Snatching Period - Newly issued science and technology innovation bonds in the primary market are mainly issued at low valuations, with the coupon rate at issuance being on average - 6BP lower than the valuation. Among 53 non - financial science and technology innovation bonds with comparable bonds, 13 are issued at high valuations, 40 at low valuations, 13 with a low - valuation exceeding - 10BP, and the maximum low - valuation is - 25BP. Currently, most science and technology innovation bonds' valuations are within ±2BP of comparable bonds. The secondary bond - snatching market may spread to the primary market. Since May, the situation of weak profit - making effects caused by low - valuation issuance of science and technology innovation bonds may change. Some low - valuation issued bonds still have potential for discovery, and it is recommended to focus on science and technology innovation bonds with a low - valuation of within - 5BP in the primary market [1][17]. 4. Game "扩": Analysis of Constituent Bonds Benefiting from the Issuance and Expansion of Science and Technology Innovation Bond ETFs - There are two main lines for constituent bond discovery: bonds with a remaining term of over 5 years and an outstanding scale of over 1.5 billion yuan. Long - term science and technology innovation bonds can significantly enhance the portfolio duration and scale expansion. Bonds included in both the science and technology innovation bond index and the credit bond benchmark market - making index may benefit from both the expansion of credit bond ETFs and the issuance of the science and technology innovation bond index. Among them, non - perpetual bonds may have stronger allocation potential [1][19].

Group 1: Solid-State Battery Industry - Favorable policies for solid-state batteries are emerging, indicating a broad application prospect as pilot lines are established, and leading companies' investments are expected to attract more entrants, leading to continuous product technology iterations [1][3] - The Chinese government plans to invest approximately 6 billion yuan in solid-state battery research and aims to achieve small-scale vehicle demonstrations by 2027, with a focus on safety standards and policy guidance for the industry [3] - The solid-state battery market is projected to reach a shipment volume of 614.1 GWh and a market size exceeding 250 billion yuan by 2030, driven by its high energy density and safety features suitable for various applications [4] Group 2: Hong Kong Stock Market Dynamics - The correlation between the Hong Kong stock market and the A-share market has significantly increased since 2020, contrasting with the historical stronger correlation with the US stock market [2][6] - The decline in foreign capital's share in the Hong Kong market and the increase in domestic capital inflow have contributed to this enhanced correlation, reflecting a shift in the investment environment [7][8] - Over 90% of the net profits in the Hong Kong market are contributed by Chinese companies, indicating a strong link between the fundamentals of the Hong Kong market and the mainland economy [8] Group 3: Semiconductor Industry - The establishment of a growth layer in the Sci-Tech Innovation Board is beneficial for high-quality semiconductor companies to stand out in the capital market, aligning with the trends of AI and self-sufficiency [9][12] - Domestic advanced process technology is continuously iterating, and AI computing chips are expected to gradually shift towards domestic foundries, creating significant opportunities for companies like SMIC and Hua Hong Semiconductor [12][12] - The ongoing sanctions against Chinese technology firms are accelerating the domestic production process, with the proportion of AI server chips sourced from abroad expected to decrease from 63% to 42% by 2025 [12]

Group 1: Coal Industry - Coal prices have bottomed out and are expected to rebound, with the next four months being a critical verification period for the fundamentals [1][2] - In May, domestic coal production was 400 million tons, showing signs of production cuts due to economic pressures, while coal imports decreased by 17.7% year-on-year [2] - The demand for coal is expected to improve as temperatures rise, with electricity consumption growth increasing from 3.1% in January-April to 4.4% in May [2][3] Group 2: Music and Audio Entertainment Industry - The company is a leading online music and audio entertainment platform in China, with a diverse range of products including QQ Music and KUGOU Music [5] - The online music service market is growing, with a significant increase in monthly active users and potential for higher paid user penetration [6][7] - The company aims to transform into a comprehensive audio entertainment empire by leveraging content IP and strategic acquisitions [7] Group 3: Aviation Industry - The domestic aviation industry is expected to achieve profitability in May, with ticket prices showing a year-on-year increase for the first time [11][12] - Passenger traffic and capacity have both increased, with a notable rise in demand during the May holiday period [12][13] - The summer travel season is anticipated to be optimistic, with airlines expected to implement proactive pricing strategies [14] Group 4: Gold Industry - The opening of the first overseas store in Singapore is expected to accelerate the brand's international expansion and growth potential [8][9] - The company is positioned in the high-end market, benefiting from brand premium and strong growth in single-store performance [9][10] - The company forecasts significant profit growth from 2025 to 2027, driven by brand strength and operational leverage [8]

Group 1: Pig Farming Industry - The report presents a unique research framework that suggests pig prices may stabilize before declining, reaching a low by the end of the year, with capacity reduction being a current industry theme [2][4] - The analysis indicates that the pig cycle consists of efficiency and breeding cycles, with a 7% year-on-year decline in breeding sows correlating with stable pig prices [3][4] - The report emphasizes that the current phase is characterized by price declines and capacity reduction, with a focus on the impacts of prices, policies, and diseases [4][5] Group 2: Duty-Free Industry - The report highlights a significant narrowing of the sales decline in the duty-free sector, with a strong rebound in average transaction value, indicating signs of data recovery [2][10] - The implementation of the "immediate buy and refund" policy nationwide is expected to enhance the shopping conversion rate for foreign consumers in China [12][20] - The report suggests that the duty-free channel has significant price advantages, allowing it to capture market share effectively, with products like cosmetics being priced at 70-80% of taxable prices [12][22] Group 3: Debt Market - The report anticipates a key strategy shift in the debt market, with expectations of a long-term decline in broad interest rates due to economic data divergence and capital market resilience [6][7] - It discusses the potential for credit bond rates to decrease, enhancing the attractiveness of government bonds [8][9] - The report emphasizes the importance of monitoring liquidity and interest rate trends, suggesting that the debt market may experience a rebound [6][7] Group 4: Solid-State Battery Industry - The report indicates that the solid-state battery industry is entering a phase of accelerated industrialization, supported by government policies and funding [24][25] - It highlights the significant market potential for solid-state batteries in various applications, including electric vehicles and low-altitude aircraft [25][26] - The report notes that leading companies are making progress in developing solid-state battery prototypes, which is expected to attract more players into the market [26][27] Group 5: Construction Industry - The report outlines that broad infrastructure investment increased by 9.2% year-on-year, while real estate investment decreased by 12% [28][30] - It emphasizes the need for continued policy support to stabilize the real estate market and improve market confidence [30][31] - The report recommends several construction companies with high dividend yields as potential investment opportunities [31]

Group 1: Macro Insights - The Federal Reserve maintained the federal funds rate target range at 4.25%-4.5%, marking the fourth consecutive meeting without changes, aligning with market expectations. However, inflationary concerns have intensified, leading to downward revisions in economic growth forecasts for 2025 and 2026, alongside an increase in unemployment rate predictions and price index forecasts [2][10][11] - The impact of tariffs on inflation has not yet fully materialized, indicating significant uncertainty regarding future inflation trends. Tariff measures require time to affect consumer prices, and geopolitical issues in the Middle East may further exacerbate inflation [2][10][11] - The market is currently exhibiting signs of stagflation trading, with expectations of a potential recovery trading phase in the latter half of the year as tax reduction measures and debt ceiling increases are implemented [3][12] Group 2: Nuclear Fusion Industry - Shanghai Superconductor's IPO application has been accepted, signaling an acceleration in the industrialization of nuclear fusion. The company is a leading producer of high-temperature superconducting materials, holding over 80% of the domestic market share for second-generation high-temperature superconducting tapes [5][20][22] - The global market for high-temperature superconducting materials is projected to grow from 790 million yuan in 2024 to over 10.5 billion yuan by 2030, driven by applications in controllable nuclear fusion and other downstream industries [6][22][23] - Shanghai Superconductor's revenue is expected to grow significantly, with projections of 240 million yuan in 2024, representing a year-on-year increase of 187.4%. The company is anticipated to achieve profitability in 2024 after previous losses [6][22][23] Group 3: Automotive Industry - The heavy truck market in China is showing signs of recovery, with a projected 16% year-on-year increase in sales to 1.06 million units in 2025, driven by the implementation of the vehicle replacement policy [17][18] - In May 2025, domestic heavy truck sales reached 89,000 units, reflecting a year-on-year increase of 13.6%. The market is expected to benefit from the ongoing vehicle replacement initiatives [18][19] Group 4: Chemical Industry - The demand for photoinitiators is increasing due to their expanding application scenarios, leading to rising product prices. Key companies in this sector include Jiuri New Materials, Yangfan New Materials, and Qiangli New Materials [34][35] - The photoinitiator market is expected to grow rapidly, driven by environmental regulations and the emergence of new applications such as 3D printing [35]

Group 1: Macro Overview - The 2025 Lujiazui Forum focused on "Financial Openness and High-Quality Development in the Context of Global Economic Changes," highlighting global financial governance, extensive financial openness, capital market support for technological innovation, and a comprehensive foreign exchange innovation policy [2][11]. - The forum emphasized the need for international financial organizations to enhance the representation of emerging markets and developing countries, and to innovate structural monetary policy tools [3][11]. Group 2: Financial System and Openness - China's financial high-level openness has vast prospects, focusing on expanding consumer demand, promoting fintech, strengthening green finance, and enhancing pension finance [3][12]. - The report outlines ten facilitation policies for foreign exchange management, aiming to create a more convenient, open, secure, and intelligent foreign exchange management system [4][13]. Group 3: Capital Market and Technology Innovation - The introduction of the "1+6" policy measures aims to deepen reforms in the Sci-Tech Innovation Board, including the establishment of a growth layer for unprofitable companies and the introduction of seasoned professional investors [4][5][29]. - The report indicates that the Sci-Tech Innovation Board will support a broader range of sectors, including artificial intelligence and commercial aerospace, enhancing the financing pathways for high-quality tech companies [6][29]. Group 4: IPO and Market Dynamics - The IPO approval process has accelerated, with 19 companies accepted for listing in 2025, signaling a positive trend for new listings [7][29]. - The report notes that the introduction of a third listing standard on the ChiNext board is expected to facilitate the listing of unprofitable companies and those from the Guangdong-Hong Kong-Macao Greater Bay Area [7][29]. Group 5: Industry Insights - The railway investment in China showed a year-on-year growth of 5.9% from January to May 2025, indicating a stable investment environment in the railway sector [18][19]. - The pharmaceutical industry is experiencing a favorable policy environment, with multiple departments issuing supportive measures for innovative drug development [21][22]. Group 6: Company-Specific Updates - Meinuo's revenue from the formulation business is expected to grow significantly, with a projected increase of 84% in 2024, driven by new product registrations and strategic partnerships [35][36]. - Didi's financial outlook remains positive, with projected net profits of 53.52 billion RMB for 2025, reflecting stable demand and improved profitability in international operations [39][40].

Group 1 - The core driver of the new consumption wave is the mismatch between supply and demand, with content marketing accelerating product innovation and transformation [2][6] - The report highlights opportunities for product renewal in traditional industries, particularly in personal care, beauty, and snacks, as new channels and media facilitate product innovation [5][8] - The report suggests that emotional value consumption is becoming increasingly important, with consumers seeking differentiated products that meet more refined and advanced needs [6][8] Group 2 - The report recommends specific companies in the beauty and personal care sectors, such as Ruifeng, Dongkang Oral Care, and brands like Maogeping and Shanghai Jahwa, which are expected to benefit from product innovation and market trends [5][6] - In the snack sector, companies like Three Squirrels and Yanjinpuzi are suggested for investment due to their ability to resonate with new consumer demands [6] - The report emphasizes the importance of new channels and media in product renewal and market penetration, with examples of how brands leverage platforms like Douyin for product testing and promotion [7][8] Group 3 - The report notes that the A-share market has shown a rebound trend since mid-April, with sectors like pharmaceuticals and banking performing well, while food and real estate sectors lagged [3][12] - It highlights the seasonal increase in stock market volatility during the dividend distribution period in May and June, affecting market dynamics [3][12] - The report indicates that the market is currently experiencing a divergence between large-cap value stocks and small-cap growth stocks, with no significant mean reversion opportunities in sight [3][12]

Investment Rating - The report maintains an "Overweight" rating for the computer sector, indicating a positive outlook for investment opportunities in this industry [1][4]. Core Insights - The report highlights the comprehensive upgrade of ByteDance's AI model family, particularly the release of Doubao Model 1.6, which enhances performance and cost-effectiveness, directly benefiting AI applications across various industries [2][4]. - The Doubao Model 1.6 has seen a significant increase in daily token usage, reaching over 16.4 trillion tokens by the end of May 2025, a 137-fold increase compared to its launch in May 2024 [4]. - The innovative pricing model based on "input length" for Doubao Model 1.6 is expected to further drive the adoption of AI technologies in various sectors, with costs significantly reduced compared to previous models [4]. Summary by Sections Model Performance - Doubao Model 1.6 includes three components: 1. Doubao-seed-1.6: An all-in-one model supporting 256K context, deep thinking, and multimodal understanding. 2. Doubao-seed-1.6-thinking: A version focused on enhancing deep thinking capabilities, also supporting 256K context. 3. Doubao-seed-1.6-flash: A high-speed version with low latency and strong visual understanding capabilities [4]. Pricing Strategy - The pricing for Doubao Model 1.6 is set at 0.8 yuan per million tokens for input and 8 yuan per million tokens for output, representing a 63% reduction in overall costs compared to previous models [4]. - A special pricing tier is introduced for requests within the 32K input and 200 tokens output range, further lowering costs to 0.8 yuan for input and 2 yuan for output [4].

Group 1 - The report maintains a positive outlook on the Chinese stock market, suggesting that external uncertainties will not significantly disrupt the upward trend, with a focus on financial, growth, and certain cyclical sectors [1][22] - The report highlights the potential for a continued bull market in Hong Kong stocks, driven by fundamental recovery and inflows from mainland investors, with expectations that Hong Kong stocks will outperform A-shares [1][4] - The report emphasizes the acceleration of AI applications, indicating that Hong Kong technology companies possess a first-mover advantage and are likely to lead the market in this sector [1][5][27] Group 2 - The report identifies a positive shift in economic expectations, suggesting that the current economic challenges are not solely related to real estate, but rather a broader transformation in supply and demand dynamics [2][23] - It notes that the decline in risk-free interest rates and the stability of the RMB will serve as significant drivers for the revaluation of Chinese assets [24] - The report recommends focusing on sectors such as financials, high-dividend stocks, emerging technology, and cyclical consumption, indicating that these areas are expected to outperform in the current market environment [24][28] Group 3 - The report draws parallels between the current macroeconomic environment and the period from 2012 to 2014, suggesting that the technology sector will again drive market performance, particularly in Hong Kong [4][27] - It highlights the importance of AI applications in driving growth, with a specific focus on software and content sectors where domestic companies are expected to excel [5][28][29] - The report indicates that the valuation of Hong Kong internet companies remains attractive, with potential for upward adjustment supported by strong earnings growth and improved capital inflows [29]