Investment Rating - The report maintains a "Buy" rating for both Shenghong Co., Ltd. and Teruid [8][10]. Core Viewpoints - The recent policy notification from four government departments aims to promote the development of high-power charging facilities, targeting over 100,000 units nationwide by the end of 2027, which is expected to accelerate market penetration and enhance profitability for equipment manufacturers and operational efficiency for service providers [1][2]. - The definition of high-power charging facilities is set at a single-gun charging power of over 250kW, with guidance provided on planning, application scenarios, and technical standards [2]. - The demand for high-power charging facilities is anticipated to grow significantly, with the market shifting from AC to DC charging stations, and from lower to higher power levels, indicating a robust growth trajectory for the high-power DC charging segment [3][4]. Summary by Sections Policy and Market Development - The notification encourages local governments to proactively plan for high-power charging infrastructure, with a focus on public transport, logistics, and heavy-duty freight applications [2]. - The report suggests that the policy framework will provide a comprehensive development path for high-power charging facilities, likely leading to increased market penetration [2]. Industry Growth and Demand - In the first five months of 2025, China added 1.583 million charging stations, a year-on-year increase of 19%, with public charging stations growing by 56% [3]. - The report highlights that as fast charging becomes more prevalent, the demand for high-power charging stations is expected to outpace overall industry growth [3]. Company Recommendations - Shenghong Co., Ltd. is recommended due to its potential for revenue growth driven by increasing demand for charging stations and expansion into overseas markets [11]. - Teruid is also recommended, with expectations of improved profitability due to its strong position in the charging business and expansion into international markets [11].

Key Insights - The report highlights a recovery in the real estate market, with new home sales showing slight improvement while the second-hand home market remains subdued. Price stabilization is anticipated, with land premium rates at low levels [2][4] - The fixed income market is expected to remain strong, particularly in credit bonds, with a focus on medium to high-grade industrial bonds and city investment bonds for investment opportunities [3][5] - The international fertilizer prices have risen significantly, driven by increased global planting areas and limited new production capacity, benefiting domestic leading companies in the fertilizer sector [4] - The transportation sector is experiencing a mixed performance, with passenger transport profitability improving due to strong travel demand, while freight transport shows divergence in profitability across different segments [5][6] - The automotive industry is entering a phase of consolidation, with a focus on key players in the humanoid robot market, as technological advancements continue to drive market confidence [6][7] - The communication sector is projected to see a 7% year-on-year increase in net profit for the second quarter, with strong performance expected from telecom operators and the optical communication segment [8] Fixed Income - The credit bond market is expected to continue its upward trend, with a focus on long-term investments and opportunities in high-quality city investment bonds [3] - Investors are advised to consider extending duration in their portfolios and to look for wave opportunities in the credit market [3] Fertilizer Industry - International fertilizer prices have increased by 42% for urea, 24% for diammonium phosphate, and 23% for potash since the beginning of the year, while domestic prices show a mixed trend [4] - The report recommends companies like Hualu Hengsheng and Xingfa Group as beneficiaries of the improving fertilizer demand and profitability [4] Transportation Sector - The second quarter is expected to show improved profitability in passenger transport, particularly in aviation and railways, driven by strong travel demand [5] - Freight transport profitability is mixed, with some segments experiencing growth while others face challenges due to competition and demand fluctuations [5] Automotive Industry - The humanoid robot market is shifting towards a more competitive landscape, with a focus on companies that have strong supply chain orders and innovative technology [6] - The report suggests that the market will increasingly favor companies with significant advancements in technology and production capabilities [6] Communication Sector - The communication sector is expected to see a 7% increase in net profit, with strong growth in the optical communication and IDC segments [8] - The report highlights the potential for continued expansion in the communication industry, driven by domestic and international demand [8]

Industry Investment Rating No industry investment rating is provided in the report. Core Viewpoints - In July, the credit bond market may be bullish. Institutions can appropriately extend the duration of their portfolios based on their liability profiles and focus on trading opportunities. The coupon strategy should focus on 3 - 5 year investment opportunities in medium - to high - grade industries, urban investment bonds, and high - quality urban and rural commercial banks. For trading, institutions can moderately participate in the opportunities of Tier 2 and perpetual bonds and long - term general credit bonds, but should leave a larger safety margin and take profits in a timely manner [1][32][33] - The sustainability of the subsequent credit market depends on non - bank allocation power, interest rate disturbances, and the liquidity situation. Credit bond ETFs have become a new highlight, but investors should be cautious not to over - participate at present [10][16][17] Summary by Directory Market Review - From June 27 to July 4, 2025, after the quarter - end, the liquidity situation was loose, the equity market performed well, and the yield of interest rate bonds fluctuated within a narrow range. The market returned to coupon hunting, and the yields of credit bonds declined across the board by about 4BP. The yields of Tier 2 and perpetual bonds generally declined by about 5BP, with the medium - and short - term yields declining more strongly, generally by over 6BP. The buying volume continued to increase, with wealth management products net buying 11.7 billion yuan and funds net buying 55.4 billion yuan. The median spreads of publicly - issued bonds of AAA - rated entities in various industries mostly declined by about 4BP, and the median spreads of urban investment bonds in each province declined across the board, with the spread in Guizhou declining by over 10BP [2][37] Primary Issuance - From June 30 to July 4, 2025, the total issuance of corporate credit bonds was 166.8 billion yuan, a 60% decline from the previous period; the total issuance of financial credit bonds was 61.7 billion yuan, a 9% decline from the previous period. Among corporate credit bonds, urban investment bonds were issued at 56.7 billion yuan, and industrial bonds at 103.2 billion yuan, with a total net financing of 30.6 billion yuan. Urban investment bonds returned to the net repayment range, with a net repayment of 14.2 billion yuan, while industrial bonds had a net financing of 44.1 billion yuan. In terms of financial credit bonds, commercial bank bonds were issued at 22.6 billion yuan, commercial bank subordinated bonds at 36.6 billion yuan, and insurance and securities company bonds at 2.5 billion yuan, with a total net financing of 6.6 billion yuan. In terms of issuance interest rates, the average issuance interest rate of medium - and short - term notes for AAA - rated entities decreased slightly, while that for AA+ - rated entities increased. The average issuance interest rate of corporate bonds increased for all ratings except AAA [3][62] Secondary Trading - Active trading entities are mainly medium - to high - grade, medium - and short - term, and central and state - owned enterprises. For urban investment bonds, active trading entities are divided into two types: mainstream high - grade platforms in economically strong provinces such as Jiangsu and Guangdong, and core platforms in regions with relatively high spreads in large economic provinces such as Shandong, Sichuan, and Henan. For real estate bonds, active trading entities are still mainly AAA - rated, with most trading terms between 1 - 3 years. For private enterprise bonds, active trading entities are also mainly AAA - rated, with most trading terms in the medium - and short - term. In terms of long - term bonds, the proportion of bonds with a remaining term of over 5 years in actively traded urban investment bonds was 2%, a slight decline from the previous week's 4% [4][73]

Investment Rating - The report maintains an "Overweight" rating for the communication sector and related sub-sectors, including communication equipment manufacturing [8]. Core Insights - The report highlights significant developments in the AI industry, particularly the historical high market capitalization of Nvidia, which reached $3.92 trillion, surpassing Apple's previous record of $3.915 trillion [2][12]. - CoreWeave has deployed Nvidia's GB300 NVL72 system, achieving a 50-fold increase in inference model output compared to the previous generation [14]. - Century Internet has raised its revenue guidance from 9.1-9.3 billion yuan (10%-13% YoY growth) to 9.15-9.35 billion yuan (11%-13% YoY growth), reflecting optimism about new project launches and operational efficiency [2][16]. Summary by Sections Market Overview - The communication index fell by 0.10% last week, while the Shanghai Composite Index rose by 1.40% and the Shenzhen Component Index increased by 1.25% [12]. - Nvidia's stock price surged to $160.98, contributing to a positive sentiment in the domestic supply chain stocks [2][12]. Key Companies and Dynamics - The report recommends focusing on the AI computing power chain in the communication industry for 2025, highlighting companies such as Zhongji Xuchuang, Xinyi Sheng, Tianfu Communication, Taicheng Light, and Ruijie Network [3]. - Core companies in asset value reassessment include China Mobile and China Telecom, while new productivity sectors like satellite internet and low-altitude economy are also emphasized [3]. Investment Opportunities - The report suggests monitoring investment opportunities in the AI computing power supply chain, including sectors like optical modules, copper connections, AIDC, switches, and liquid cooling [12][14]. - Specific stock recommendations include: - Zhongji Xuchuang (Buy, target price 164.78 yuan) - Xinyi Sheng (Buy, target price 128.76 yuan) - Tianfu Communication (Buy, target price 119.12 yuan) - Taicheng Light (Hold, target price 99.01 yuan) - Ruijie Network (Buy, target price 88.70 yuan) [8][52].

Group 1: Fiscal Impact - The "Big and Beautiful" bill is expected to increase the U.S. fiscal deficit by $4.1 trillion over the next ten years, raising the deficit rate by 3-4 percentage points compared to 2010-2019 levels[2] - The average deficit rate over the next decade is projected to reach 6.4%, potentially increasing to 6.7% if certain tax cuts are extended beyond 2028[2][3] - The bill's implementation may lead to a fiscal deficit of approximately 7% in 2026, with short-term growth support for Q4 2025 and 2026[1][3] Group 2: Economic Growth and Inflation - The bill is anticipated to provide short-term economic growth support, but its long-term effectiveness is expected to diminish, potentially exacerbating inflation[3][4] - Independent institutions estimate that the bill will only contribute an additional 0.4% to U.S. GDP over the next decade, significantly lower than the White House's estimate of 2.4%-2.7%[3] Group 3: Social and Political Consequences - The bill may worsen income and welfare distribution in the U.S., intensifying political polarization, as high-income individuals and corporations benefit more from tax cuts[5] - The average annual tax cut for the wealthiest families is projected to be $12,000, while the poorest families may face a net loss of $1,600 annually[5] Group 4: Debt Sustainability Concerns - The bill could further undermine U.S. debt sustainability, with total government debt expected to rise from 124% of GDP[4] - The vision of reducing the deficit post-2029 is considered overly optimistic, with potential increases in interest costs and lower-than-expected GDP growth[4]

Quantitative Models and Construction Methods - **Model Name**: Hang Seng Stock Connect Hong Kong Technology Theme Index (HSSCITI.HI) **Model Construction Idea**: The index focuses on the TMT (Technology, Media, and Telecommunications) sector, ensuring high "technology purity" by excluding industries such as pharmaceuticals, home appliances, and automobiles, which may dilute the thematic investment returns[2][28][29] **Model Construction Process**: 1. The index selects stocks listed in Hong Kong that qualify for Southbound trading under the Stock Connect program[34] 2. It focuses on companies in the technology sector, including software, hardware, semiconductors, and internet services, while excluding non-core technology industries[29][34] 3. The index uses free-float market capitalization weighting, with individual stock weight capped at 10%[34] 4. The index is rebalanced semi-annually to ensure alignment with its thematic focus[34] **Model Evaluation**: The index demonstrates a high level of thematic focus, capturing the growth potential of the TMT sector while avoiding the risks associated with unrelated industries[29][34] Model Backtesting Results - **Hang Seng Stock Connect Hong Kong Technology Theme Index**: - 1-year annualized return: 55.90% - 3-year annualized return: 8.83% - Comparative performance: Outperformed the Hang Seng Index, which had 1-year and 3-year annualized returns of 36.31% and 3.55%, respectively[43] Quantitative Factors and Construction Methods - **Factor Name**: Technology Sector Focus **Factor Construction Idea**: The factor emphasizes the concentration of investments in the TMT sector to maximize exposure to technology-driven growth opportunities[29][34] **Factor Construction Process**: 1. Stocks are selected based on their classification within technology-related industries such as software, hardware, and semiconductors[29][34] 2. Non-technology sectors like pharmaceuticals, home appliances, and automobiles are excluded to maintain thematic purity[29][34] 3. The weighting scheme ensures a balanced representation of sub-sectors within the TMT domain, with significant allocations to internet platforms, hardware, and software companies[29][33] **Factor Evaluation**: The factor effectively captures the growth dynamics of the technology sector while minimizing exposure to unrelated industries, enhancing the thematic investment appeal[29][34] Factor Backtesting Results - **Technology Sector Focus Factor**: - Sector allocation: Information Technology (66.55%), Consumer Discretionary (18.25%), Communication Services (15.20%)[33] - Sub-sector allocation: Hardware (27.35%), Software (25.75%), Semiconductors (13.45%), Media (14.42%)[31][33] - Top contributors: Internet platform companies (e.g., Tencent, Alibaba, Meituan) accounted for approximately 44% of the index weight[29][32]

Group 1 - The report highlights sectors with high growth potential and cost-effectiveness, including financials, consumer staples, and technology hardware, with a focus on service consumption and software services in the medium term [1] - The report indicates that the EPS of Chinese listed companies is expected to rise for the third consecutive year in 2025, with a significant rebound in market performance anticipated following improvements in EPS expectations [2][3] - The report emphasizes that the correlation between EPS growth and nominal economic growth is strong, suggesting that structural changes in the stock market and improvements in corporate profitability are crucial for capturing market opportunities [3] Group 2 - The report identifies consumer services, durable goods, and technology hardware as sectors with high ROE levels that are likely to improve further, indicating strong investment potential [7][18] - It notes that sectors such as software services, consumer staples, and household products maintain high levels of cost-effectiveness, while technology hardware and durable goods are not significantly overvalued [7][20] - The report provides a comparative analysis of PEG ratios, indicating that sectors like diversified finance, materials, and durable goods have PEG levels below 1, suggesting attractive valuations [20][23] Group 3 - The report discusses the importance of earnings performance in the context of upcoming earnings disclosures, highlighting that sectors with improved economic conditions provide a solid foundation for market performance [4] - It mentions that the Hong Kong market's liquidity is primarily driven by capital inflows, which are influenced by the market's comparative advantages [3] - The report outlines that the valuation levels of Hong Kong stocks remain attractive compared to global markets, with a current forward PE of around 10x [53][47]

Core Insights - The report highlights the increasing difficulty for investors in the bond market as of mid-2025, with limited downward interest rate space, low coupon rates, narrow volatility ranges, intensified trading competition, and excessive strategy exploration [1][12] - Investors are focusing on "micro-operation" strategies such as bond switching, heavy positions in credit bond ETFs, narrowing spreads, and marginal bidding in primary auctions to capture alpha opportunities, although these strategies are becoming crowded [1][2][4] - The overall direction of the bond market is slightly bullish, but the space for further gains is limited, and the micro-operation trends may still have some inertia [1][4] Strategy One: "Diminishing Effect" of Bond Switching - There has been a rising interest in bond switching strategies among investors, particularly in the context of new and old bonds [2][13] - Historical data indicates that bond switching can enhance returns, but signs of diminishing effectiveness have emerged since Q2 2025 due to increased trading competition [2][18] - The conversion period for new bonds to active bonds has significantly shortened, and the interest rate spread between new and old bonds has narrowed, leading to potential overextension of strategy returns [2][18] Strategy Two: "Extreme" Credit Bond ETF Heavy Positioning - The rapid expansion of benchmark credit bond ETFs has led to significant changes in credit bond pricing [3][21] - The average valuation of index component bonds has compressed, with a notable decrease in spreads compared to ordinary credit bonds [3][21] - Investors are advised to avoid overly crowded index component bonds due to the severe valuation distortions that have occurred [3][25] Strategy Three: Flattening "All" Spreads - The bond market is generally bullish, but the downward space for key active bonds like the 10-year government bond is limited [4][12] - Certain bond types still present value opportunities, including 20-year government bonds and AAA-rated bank subordinated bonds [4][12] - Investors should be cautious in participating in trades related to long-end credit spreads due to the lack of support from insurance premiums and potential market volatility [4][12] Strategy Four: Increasing Marginal Bidding in Primary Auctions - There has been a rise in the enthusiasm for using marginal bidding strategies in the primary market for arbitrage between primary and secondary markets [5][12] - The historical data shows that the marginal bidding multiples for 10-year government bonds have reached record highs, reflecting the strategy's increased accuracy in a narrow trading environment [5][12]

1. Report Industry Investment Rating No information provided regarding the report industry investment rating. 2. Core View of the Report The report indicates that recent Trump policies have made progress in areas such as finance, deregulation, and tariffs. The market has started to price in the medium - term "Goldilocks" scenario, bypassing short - term mild stagflation. There is a path from the current short - term mild stagflation (economic decline and inflation rise) to the "Goldilocks" scenario, and the probability of this scenario has increased with the advancement of recent policy combinations. However, the stability of this path remains to be confirmed [7]. 3. Summary according to Related Content Impact of the "Big and Beautiful" Act - **Deficit Impact**: By 2035, the act will increase national debt issuance by $4.1 trillion. The fiscal deficit rates from 2026 - 2029 may all be above 7%, with the peak in 2028. Compared with not implementing the act, the deficit rates in 2026 and 2027 will increase by over 1 percentage point, which will have a certain stimulating effect on economic growth in the next two years [2]. - **Distribution Aspect**: Tax cuts are mainly TCJA extensions, tax - free deductions for tips and overtime pay, and an increase in the deduction limit for state and local taxes, showing regressive characteristics. Expenditure cuts focus on reducing welfare such as Medicaid and SNAP, reducing student loans, and canceling clean - energy tax incentives, which have a greater impact on low - income groups. The final act may cause the income of the bottom fifth of the population to decline by 2.9% (about $700), while the income of the top 1% will increase by 1.9% (about $30,000) [2][3]. - **Debt Ceiling**: The federal debt ceiling is raised by $5 trillion, the largest increase in history. This avoids the debt - ceiling issue before next year's mid - term elections and provides room for fiscal expansion in the next 2 - 3 years. It also affects the fiscal strength in the second half of this year compared to the first half. Additionally, the rapid replenishment of the TGA account may temporarily affect liquidity [3]. - **Clause Deletion**: Deleting the previous "Capital Tax" Clause 899 reduces the uncertainty for foreign investors, and the market may have already priced it in [4]. - **Industry Aspect**: In the United States, sectors such as semiconductors, defense, aerospace, and traditional energy are expected to benefit, while subsidies for the new - energy, electric - vehicle, and medical industries will be reduced, which is a negative factor. In terms of overall economic impact, the profitability of the consumer sector may be affected by tariffs. In the short term, focus on interest - sensitive growth sectors, and in the medium term, focus on fiscal - related pro - cyclical sectors [4]. Tariff Policy Concerns - **Tariff Rate Setting**: The US will start sending letters to countries as early as Friday to set new tariff rates before July 9, which will be implemented from August 1. Negotiations with key countries such as Europe and Japan may continue, and the new tariffs may postpone the negotiations until August 1, with the possibility of further postponement [5]. - **Tariff Rate Ranges**: The approximate tariff rate ranges for different countries are: about 10% for allied countries, about 20% for friendly countries, and over 30% for competing countries (referring to the 40% tariff on Vietnam's trans - shipped goods). Trump's claimed 60% - 70% tariff may have a punitive nature. The market's reaction to tariffs may continue to show a blunted characteristic, with expected disturbances but limited amplitude [5]. - **US - Vietnam Agreement**: The US will impose at least a 20% tariff on Vietnamese products and a 40% tariff on goods from other countries trans - shipped through Vietnam. This further strengthens the prediction of tariff rate ranges. The direct impact on China is limited, and the US's intention to promote Vietnam's industrial chain localization through origin - related regulations can be hedged by China's strong industrial chain advantages in capital goods and raw materials, but the demonstrative effect is worthy of vigilance [6]. Outlook on the US Economic Scenario - **Short - term Situation**: In the short term, the US economy is in a state of mild stagflation with economic decline and inflation rise. However, there is a path to the "Goldilocks" scenario. The probability of this scenario has increased with the advancement of recent policies, and appropriate trading can be considered [7]. - **Stability Uncertainty**: The stability of this path needs to be confirmed. The key for the US economy not to enter a recession is that financial conditions should not tighten rapidly, which requires the stability of the US stock and bond markets. The specific impact of tariffs remains to be seen after the consumption of excess inventory. If inflation or corporate profitability deviates from expectations, market trading may shift again [8]. - **Long - term Outlook**: In the long run, the reconstruction of the global trade, financial, and geopolitical order is a more fundamental factor beyond economic growth rates [9].

证券研究报告 电力设备与新能源 周观点：工信部召开座谈会，治理低 价无序竞争 华泰研究 2025 年 7 月 06 日│中国内地 行业周报（第二十七周） 周观点：工信部部长召开座谈会，治理低价无序竞争 7 月 3 日，工业和信息化部党组书记、部长李乐成主持召开光伏行业制造业 企业座谈会，聚焦加快推动光伏产业高质量发展，听取光伏行业企业及行业 协会情况介绍和意见建议。14 家光伏行业头部企业及光伏行业协会负责人 作交流发言，介绍企业基本情况、面临的困难和问题，提出政策建议。会议 强调，要依法依规、综合治理光伏行业低价无序竞争，引导企业提升产品品 质，推动落后产能有序退出，实现健康、可持续发展。我们认为本次会议工 信部部长主持，头部企业负责人参会，为历次光伏企业座谈会的最高规格， 明确了政府与行业协同推动供给侧改革的大方向，看好后续供给侧改革细则 陆续落地，推动行业供需格局重塑。 子行业观点 1）新能源车：6 月国内新能源车销量走势较好；2）储能：SPE 提出欧洲储 能十倍扩容目标，我们看好欧洲大储起量；3）光伏：工信部部长召开座谈 会，治理低价无序竞争；4）风电：国内海风招中标稳步推进。 重点公司及动态 1）宁 ...