Investment Rating - The report maintains an "Accumulate" rating for the diversified financial sector [5] Core Insights - Stablecoins are essentially privately issued digital shadow currencies backed by sufficient reserves, gradually penetrating into real economy payment scenarios, which warrants attention regarding their impact on currency circulation and the government bond market [1][12] - As of June 18, 2025, the total market size of USD stablecoins reached approximately $220 billion, accounting for about 1% of USD M2 [1][21] - The initial use case of stablecoins was as a medium for cryptocurrency trading, with around 80% of stablecoin transaction volume still attributed to crypto asset trading as of 2024 [2][30] - Stablecoins exhibit low-cost and high-efficiency characteristics, particularly in cross-border payments, contributing to over 70% of the $600 billion in cross-border flows in Q2 2024 [2][43] - The interaction between stablecoins and currency liquidity is generally neutral, with their issuance not significantly altering the factors determining fiat currency liquidity [62] Summary by Sections Nature of Stablecoins - Stablecoins are issued by private commercial entities and are considered credit money, as they represent a claim against the issuing institution [12] - They are backed by sufficient reserves, which limits their issuance scale to the reserve size, unlike traditional fiat money which can be created with leverage [12][21] - Stablecoins are based on blockchain technology, allowing for peer-to-peer transactions without central control [12] Initial Use Cases - The development of stablecoins like USDT was driven by the need for a stable medium of exchange in cryptocurrency trading, particularly to reduce the high friction costs associated with converting fiat to crypto [30][31] Payment Integration - Stablecoins are increasingly accepted in traditional payment scenarios, especially in cross-border transactions where they provide a more efficient alternative to fiat currencies [43][45] Central Bank Digital Currency (CBDC) Outlook - CBDCs and stablecoins share similar technological foundations but differ in their issuers, with CBDCs being state-backed and stablecoins being privately issued [56] - The potential for CBDCs to penetrate the market is significant, especially in areas where stablecoins are currently utilized [58] Interaction with Currency Liquidity and Government Bonds - The issuance of stablecoins does not significantly impact fiat liquidity, as their effects are largely neutral unless considering the choice of reserve assets [62]

Investment Rating - The report maintains a "Buy" rating for the company [8] Core Views - The company is a leading player in the global electric two-wheeler market, with sales increasing from 4.06 million units in 2017 to 13.02 million units in 2024, maintaining the top position for eight consecutive years [2] - The company is expected to benefit from industry consolidation and favorable policies, including the new national standards and trade-in programs, which are anticipated to drive market share growth [4] - The company has optimized its product structure and marketing strategies, focusing on high-value products, which has led to a significant increase in sales and profitability in the first half of 2025 [3] Summary by Sections Company Overview - The company has over 40,000 stores and is expanding its battery and related components production to strengthen its competitive advantage [2] Financial Performance - The company forecasts a net profit of at least 1.6 billion RMB for the first half of 2025, representing a year-on-year increase of over 55% [3] - The revenue for 2025 is projected to be 37.79 billion RMB, with a significant recovery from a decline in 2024 [7] Market Outlook - The domestic market is expected to see high growth due to the trade-in policy, with 6.5 million electric bicycles traded in from January to May 2025 [4] - The company is actively pursuing international expansion, particularly in Southeast Asia, with new product launches and factory openings [4] Profitability and Valuation - The report raises the profit margin assumptions, predicting net profits of 2.99 billion RMB and 3.51 billion RMB for 2025 and 2026, respectively [5] - The target price is adjusted to 19.61 HKD, based on a price-to-earnings ratio of 17.82 for 2025 [5][9]

Key Insights - The report highlights the emergence of 10 AAA-rated technology innovation bond ETFs, which are expected to track various AAA-rated technology bond indices, indicating a growing interest in high-credit-quality bonds in the technology sector [2] - The report notes a slight recovery in the second-hand housing market, while new home sales have cooled down, suggesting a mixed outlook for the real estate sector [3] - The automotive industry is experiencing improved cash flow as major companies shorten payment terms to suppliers, which is expected to enhance the financial stability of component manufacturers [5] - The report discusses the impact of geopolitical tensions on the methanol supply chain, particularly due to reduced production in Iran, which could affect domestic prices and supply dynamics [7] - The report indicates that the potential closure of the Strait of Hormuz could increase demand for oilfield service equipment, benefiting companies in this sector [8] - The report initiates coverage on SANY Heavy Energy, projecting a target price of 30.18 CNY, driven by expected growth in the wind energy sector [9] - Alibaba's organizational restructuring is expected to enhance its competitive position in the consumer services market, with a focus on synergy between its various business units [11] - Modern Dairy is projected to face a net loss in the first half of 2025 due to impairment losses, but operational improvements are expected to stabilize its performance in the second half [12] Fixed Income Insights - The report indicates a balanced liquidity environment in the market, with a net withdrawal of 799 billion CNY from the open market, reflecting a stable funding situation [6] - The report emphasizes the importance of stablecoins evolving into a significant asset class, with projections suggesting a market cap of approximately 1.4 trillion USD by 2030 [6] Industry Trends - The report identifies a trend of reduced supply chain pressures in the automotive sector, which may lead to improved financial health for component suppliers [5] - The report highlights the potential for increased oilfield service demand due to geopolitical risks, suggesting a shift in energy security priorities among nations [8]

Report Summary 1. Industry Investment Rating There is no industry investment rating provided in the report. 2. Core Viewpoints - The commitment of 17 key automakers to shorten the payment period to suppliers within 60 days is a positive response to the "Regulations on Ensuring Payment for Small and Medium - sized Enterprises", which helps to alleviate market concerns about automakers' repayment ability and promotes the healthy development of the industry [2][10][11]. - For automakers, the shortened payment period has limited impact on cash - flow as they have sufficient bank credit. For component manufacturers, it can improve capital turnover, increase cash on hand, and potentially reduce impairment losses and improve profitability [2][13][15]. - The bond market shows that under the central bank's support, the mid - to long - term credit bonds remain strong. The issuance sentiment of credit bonds is warming up, and the secondary trading of short - duration bonds is active with a slight increase in long - duration trading [3][52][62]. 3. Summary by Directory 3.1 Credit Hotspot: Automakers Shortening Payment Periods - 17 key automakers, including BYD, Geely, FAW, etc., promised to unify the supplier payment period within 60 days. SAIC and BAIC additionally promised not to use commercial acceptance bills, while FAW and Jianghuai promised to streamline approval processes [10]. - As of June 22, 2025, there are 8 automaker bond - issuing entities with a cumulative outstanding bond scale of 66.9 billion yuan, and 4 component bond - issuing entities with a cumulative outstanding bond scale of 4 billion yuan [11]. - For automakers, although the shortened payment period may have a short - term impact on operating cash - flow, the cash - flow pressure is limited due to their good credit and sufficient unused bank credit. For example, if the accounts payable and notes turnover rate is adjusted to 6, the capital gap of most automakers is about 50 billion yuan, and Geely Holding Group's gap exceeds 100 billion yuan [13][15]. - For component manufacturers, the shortened payment period can improve capital turnover and cash on hand. On average, component companies may receive 3.5 billion yuan in additional monetary funds, which can enhance operational flexibility and risk - resistance ability [15]. - In terms of bond - issuing entity spreads, the industry spread of industrial bonds consists of liquidity premium and credit risk premium. In the short term, the commitment benefits component manufacturers more, and some high - spread entities may see a narrowing of spreads. Automakers' spreads are mainly affected by liquidity premium [20]. 3.2 Market Review - From June 6 to June 13, 2025, the monetary policy expectations at the Lujiazui Forum were not met, but the central bank maintained a loose tax - period capital environment. The mid - to long - term credit bonds remained strong, with yields of 7 - 10Y varieties mostly falling by more than 4BP. Some spreads increased slightly due to the strong performance of interest - rate bonds [3][27]. - The yields of Tier 2 and perpetual bonds also generally declined, with 5 - 10Y yields falling by about 4BP. The median spreads of public bonds in various industries showed mixed trends, and the median spreads of urban investment bonds in most provinces declined, with Inner Mongolia's spread dropping by more than 4BP [3][27]. 3.3 Primary Issuance - From June 16 to June 20, 2025, corporate credit bonds issued a total of 334.7 billion yuan, a slight 4% decrease from the previous period; financial credit bonds issued a total of 173 billion yuan, a 61% increase from the previous period. The net financing of corporate credit bonds was 28.7 billion yuan, with urban investment bonds having a net repayment of 26.5 billion yuan and industrial bonds having a net financing of 59.6 billion yuan [4][52]. - The issuance of credit bonds continued to recover after holiday factors and annual report updates. The average issuance rates of medium - short - term notes and corporate bonds showed a downward trend [4][52]. 3.4 Secondary Trading - Active trading entities are mainly medium - to high - grade, medium - short - term, and central and state - owned enterprises. Urban investment bond trading is mainly concentrated in high - grade platforms in economically strong provinces and core platforms in high - spread areas of large economic provinces. Real - estate bond trading is mainly AAA - rated with a maturity of 1 - 3 years, and private enterprise bond trading is also mainly AAA - rated with medium - short maturities [5][62]. - The proportion of trading volume of urban investment bonds with a maturity of over 5 years increased slightly from 0% to 2% compared to the previous week [5][62].

Report Summary 1. Report Industry Investment Rating No industry investment rating is provided in the report. 2. Core Viewpoints The report analyzes the liquidity situation from June 16 - 20, 2025, indicating that the overall capital market shows a state of balanced and slightly loose funds, with some indicators showing upward or downward trends, and the market's expectation of the capital situation is relatively stable. Attention should be paid to the impact of factors such as the end - of - quarter credit impulse and government bond supply on the capital market [1][2][3]. 3. Summary by Related Content 3.1 Open Market Operations and Fund Rates - Last week, the open - market maturity was 1040.2 billion yuan, including 858.2 billion yuan of reverse repurchase maturity and 182 billion yuan of MLF maturity. The open - market investment was 960.3 billion yuan, all in reverse repurchase, with a net withdrawal of 7.99 billion yuan. The overall capital situation was balanced and slightly loose, with the average DR007 at 1.52%, up 0.5BP from the previous week, and the average R007 at 1.58%, up 1BP from the previous week. The average DR001 and R001 were 1.38% and 1.44% respectively. The exchange repurchase rate increased, with the average GC007 at 1.61%, up 4BP from the previous week. As of the last trading day of last week, the outstanding balance of reverse repurchase was 960.3 billion yuan, up from the previous week [1]. 3.2 Certificate of Deposit (CD) and IRS Yields - Last week, the total maturity of CDs was 1021.64 billion yuan, the issuance was 1102.32 billion yuan, and the net financing scale was 80.68 billion yuan. As of the last trading day of last week, the yield to maturity of 1 - year AAA CDs was 1.64%, down from the previous week. This week, the single - week maturity scale of CDs is about 1137.81 billion yuan, with a greater maturity pressure than the previous week. In terms of interest rate swaps, the average of the 1 - year FR007 interest rate swap last week was 1.53%, up from the previous week. The market's expectation of the capital situation is stable, and CDs are more affected by seasonal supply - demand pressure [2]. 3.3 Repurchase Volume and Institutional Behavior - Last week, the volume of pledged repurchase was between 7.7 - 8.8 trillion yuan, with the average R001 repurchase volume at 7462.2 billion yuan, up 361.4 billion yuan from the previous week. As of the last trading day of last week, the outstanding balance of repurchase was 12.7 trillion yuan, up from the previous week. The repurchase leverage has returned to the high point of December last year. By institution, the lending scale of large banks increased, while that of money market funds decreased. The borrowing scales of securities firms, funds, and wealth management increased. As of Friday, the repurchase balances of large banks and money market funds were 5.30 trillion yuan and 1.94 trillion yuan, up 358.3 billion yuan and down 9.4 billion yuan respectively from the previous week. The positive repurchase balances of securities firms, funds, and wealth management were 1.86 trillion yuan, 2.47 trillion yuan, and 777.6 billion yuan respectively, up 21.7 billion yuan, 83.5 billion yuan, and 55.6 billion yuan respectively from the previous week [3]. 3.4 Bill Rates and Exchange Rates - Last Friday, the 6M national stock bill transfer quotation was 1.05%, up from the last trading day of the previous week. Near the end of the quarter, attention should be paid to the situation of credit impulse. Last Friday, the US dollar - to - RMB exchange rate was reported at 7.18, up slightly from the previous week, and the Sino - US interest rate spread narrowed. Last week, the Fed held its June FOMC meeting, keeping the federal funds rate target range at 4.25 - 4.5%, maintaining the interest rate unchanged for four consecutive times, while raising the inflation forecast and lowering the economic growth forecast, suggesting an increase in stagflation risk. Due to the Fed's caution, the approaching inflation pulse, and the Treasury's supply pressure, short - term US bond yields may remain high [4]. 3.5 This Week's Key Concerns - This week, the open - market capital maturity is 1060.3 billion yuan, including 960.3 billion yuan of reverse repurchase maturity and 100 billion yuan of treasury deposit maturity. On Friday, China's industrial enterprise profits for May will be announced, and attention should be paid to the enterprise profit repair situation. The eurozone's economic sentiment index for June will also be announced on Friday, and attention should be paid to the eurozone's economic trend. In addition, the US PCE for May will be announced on Friday, and attention should be paid to the inflation trend. This week, the 7 - day repurchase starts to cross the quarter, and the government bond supply scale is large. Attention should be paid to the impact on the capital situation [5].

Investment Rating - The report maintains a "Buy" rating for China Mobile, China Telecom, and ZTE Corporation, while China Unicom is rated as "Hold" [10][11]. Core Insights - The China Securities Regulatory Commission has restarted the fifth set of listing standards for the Sci-Tech Innovation Board, expanding its scope to include artificial intelligence, commercial aerospace, and low-altitude economy sectors, which is expected to enhance financing channels for leading enterprises in these industries [2][3][15]. - The report highlights the growth opportunities in the commercial aerospace and low-altitude economy sectors, driven by supportive policies and the acceleration of commercialization [3][16]. Summary by Sections Market Overview - The communication sector index rose by 1.58% last week, while the Shanghai Composite Index fell by 0.51% and the Shenzhen Component Index decreased by 1.16% [2][14]. Key Companies and Developments - The report recommends focusing on key players in the communication industry, including China Mobile, China Telecom, and ZTE Corporation, due to their strong market positions and growth potential in AI and digital services [4][11][50]. - The report emphasizes the importance of the commercial aerospace sector, particularly in areas such as rocket engines, satellite payloads, and ground terminal manufacturers, as well as low-altitude economy players like airspace digital service providers [3][16]. Investment Recommendations - Specific stock recommendations include: - China Mobile (600941 CH) with a target price of 126.40 and a "Buy" rating - China Telecom (601728 CH) with a target price of 9.13 and a "Buy" rating - China Unicom (600050 CH) with a target price of 7.62 and a "Hold" rating - ZTE Corporation (000063 CH) with a target price of 39.41 and a "Buy" rating [11][49].

Investment Rating - The investment rating for the company is "Buy" with a target price of 1.14 HKD [6][7]. Core Views - The company is expected to report a net loss of 800-1,000 million RMB for the first half of 2025, compared to a net loss of 210 million RMB in the same period last year. The apparent profit loss is primarily due to impairment and other non-cash items, while actual operations remain stable [1][2]. - The company is actively improving its herd structure and controlling operational costs, with a slight expected decrease in the total number of dairy cows by the end of the first half of 2025, while raw milk sales volume is projected to increase by approximately 10% year-on-year [1][2]. - The company anticipates a reduction in feed costs and other cash costs in the second half of 2025, which may alleviate impairment pressures and allow for profit recovery [1][2]. Summary by Sections Financial Performance - The company expects to report a cash EBITDA for the first half of 2025 that is roughly comparable to the previous year, despite the apparent profit loss due to non-cash impairment losses estimated at 1,650-1,850 million RMB, an increase of 500-700 million RMB year-on-year [2][4]. - Revenue projections for 2025-2027 indicate a slight recovery, with expected net profits of -1,313 million RMB in 2025, 658 million RMB in 2026, and 1,117 million RMB in 2027, reflecting a significant turnaround [4][5]. Market Dynamics - The current dairy price adjustments are driven by supply-demand mismatches, with the company indicating a clear direction towards capacity reduction in response to prolonged low milk prices [3]. - The company is expected to see a decrease in its breeding stock in 2025, reflecting the industry's response to market conditions, with a notable increase in the proportion of productive cows [3]. Valuation Metrics - The target price of 1.14 HKD corresponds to a 13x PE ratio for 2026, down from a previous target of 1.35 HKD, indicating a cautious outlook due to ongoing impairment losses [4][6]. - The company's estimated EPS for 2025 is -0.17 RMB, with projections of recovery to 0.08 RMB in 2026 and 0.14 RMB in 2027, suggesting a potential for profit growth in the coming years [5][12].

Investment Rating - The report maintains an "Overweight" rating for the construction materials sector [10]. Core Insights - The report highlights that policy measures and mid-year performance expectations are likely to stimulate activity in the construction materials sector, with a focus on the differentiated investment in fiberglass [13][14]. - Infrastructure, real estate, and manufacturing fixed asset investments showed mixed results, with infrastructure maintaining growth while real estate declined significantly [15][18]. - The report emphasizes the importance of upcoming mid-year performance disclosures and the potential for increased domestic investment in July due to improved project funding and debt resolution efforts [13][15]. Summary by Sections Investment Trends - From January to May 2025, fixed asset investments in infrastructure, real estate, and manufacturing showed year-on-year changes of +5.6%, -10.7%, and +8.5% respectively, indicating a decline in real estate investment [15]. - Key sectors such as electricity, railways, and water conservancy continue to exhibit high levels of activity despite a general slowdown in construction [15][18]. Market Dynamics - The report notes a continued decline in prices for photovoltaic glass, with expectations of supply contraction in Q3 2025 due to production adjustments by leading companies [13][22]. - The domestic supply of fiberglass continues to increase, while overseas production capacity is shutting down, leading to tight supply for high-end electronic yarns and fabrics [13][23]. Recommended Companies - The report recommends several companies with high growth potential, including: - Yaxiang Integration (603929 CH) with a target price of 38.40 and a "Buy" rating - Sichuan Road and Bridge (600039 CH) with a target price of 11.03 and a "Buy" rating - China Nuclear Engineering (601611 CH) with a target price of 10.81 and a "Buy" rating - China Construction International (3311 HK) with a target price of 15.61 and a "Buy" rating - China National Materials (002080 CH) with a target price of 19.60 and a "Buy" rating [11][39]. Price Trends - As of June 20, 2025, the national average price for cement was 361 RMB/ton, reflecting a week-on-week decline of 1.1% [29]. - The average price for float glass was 65 RMB/weight box, down 2.1% week-on-week and 25.9% year-on-year [30][21]. Inventory and Production - The report indicates that as of June 19, 2025, the total inventory of float glass in key monitored provinces was approximately 60.52 million weight boxes, with an inventory turnover of about 31.24 days [32]. - The production capacity for photovoltaic glass remains stable, with 459 production lines in operation, maintaining a daily melting capacity of 98,990 tons [33].

Macro Insights - The report indicates a weak export performance, with port container throughput showing a month-on-month decline, suggesting a slowdown in external demand [2][3] - Domestic economic data for May shows a mixed picture, with industrial production slowing and real estate cycles weakening, while consumption growth was boosted by one-off factors [2][3] - The report highlights that some cities are increasing support for the real estate sector, such as Guangzhou's plan to lift purchase restrictions [2] Strategy Insights - The report suggests that short-term risk appetite may not improve, recommending a cautious approach to positions [3] - It notes that high consumer demand is difficult to sustain, with pressures from real estate adjustments and slowing exports becoming more evident [3] - The report emphasizes a focus on large financial sectors and suggests gradual accumulation in sectors with potential for acceleration, such as innovative pharmaceuticals and AI [3] Fixed Income Insights - The report discusses the necessity and limitations of interest rate policies, indicating that while there is a need for rate cuts, the space for such actions is limited [9] - It suggests that the bond market is currently biased towards a bullish direction, but with limited room for significant gains [9] - The report recommends focusing on specific opportunities in medium to long-term bonds and high-quality credit bonds [9] Real Estate Insights - The report tracks the implementation of the stock housing storage policy, noting that while there have been some positive developments, the actual scale of implementation remains limited [11] - It highlights that local governments are gaining more autonomy in the acquisition process, which could enhance the effectiveness of the policy [11] - The report anticipates that continued policy optimization could contribute significantly to stabilizing the real estate sector [11] Power Equipment and New Energy Insights - The report states that inverter exports reached 5.97 billion yuan in May, with a month-on-month increase of 2.7%, indicating strong demand from Southeast Asia [13] - It emphasizes that long-term demand for inverters is expected to remain robust due to factors such as rising electricity prices and increased installations of wind and solar power [13] - The report recommends specific companies in the sector, including DeYue Co., GuDeWei, and SunPower, as having strong performance support [13] Company-Specific Insights - The report initiates coverage on YunDa Co. with a target price of 13.05 yuan, highlighting its strong growth potential driven by domestic and overseas wind power projects [16] - It also covers YaXiang Integration, giving it a target price of 38.40 yuan, citing its competitive position in the cleanroom engineering services market [17] - The report highlights Changjiang Infrastructure as a buy with a target price of 64.73 HKD, noting its strong cash flow and consistent dividend growth [18]

Investment Rating - The report maintains an "Accumulate" rating for the company [8] Core Views - The company has successfully acquired a large natural soda ash mining right, which will significantly increase its soda ash production capacity and enhance its cost and scale advantages [1][2] - The mining area has abundant water resources and advantageous geographical location, which will support the company's operations [2] - The company will fully consolidate the joint venture with PetroChina, further expanding its soda ash scale advantages and enhancing its core competitiveness in the industry [3] Summary by Sections Acquisition and Resource Advantages - The company, in partnership with PetroChina, won the natural soda ash mining rights in Tongliao City for 6.8 billion RMB, with estimated reserves of 1.447 billion tons of natural soda ash [2] - The mining area benefits from a favorable annual rainfall of 350-450mm and a significant river runoff, providing ample water resources [2] Production Capacity and Cost Efficiency - The company currently has a nominal soda ash production capacity of 3.9 million tons, ranking third in the domestic market [3] - The company is implementing multiple technical upgrades to reduce production costs, which is expected to enhance profitability [4] Financial Forecast and Valuation - The company’s projected net profits for 2025-2027 are 610 million, 780 million, and 1.01 billion RMB, respectively, with corresponding EPS of 0.42, 0.53, and 0.69 RMB [5] - The target price is set at 8.40 RMB, reflecting a 20x PE valuation for 2025, indicating growth potential from the newly acquired natural soda ash resources [5][9]