Investment Rating - The report assigns a "Neutral" rating to the company with a target price of HKD 7.20, indicating a potential downside of 5.5% from the current closing price of HKD 7.62 [6][10]. Core Insights - The company's performance in Q1 2025 continues to be under pressure from centralized procurement and healthcare cost control, but is expected to improve gradually starting from Q2 2025. The management anticipates achieving three significant business development (BD) licensing deals, each exceeding USD 5 billion in 2025 [2][6]. - The report highlights that excluding BD revenue, the company's Q1 2025 revenue declined by 30% year-on-year, with the traditional medicine segment experiencing a 37% drop. Key therapeutic areas showed declines due to various factors, including price negotiations and centralized procurement impacts [6][11]. - The report projects revenue growth for the company, with estimates for 2025E at RMB 30,040 million, increasing to RMB 35,830 million by 2027E, reflecting a compound annual growth rate [5][11]. Financial Forecast Changes - Revenue estimates for 2025-2027 have been adjusted upwards by 1.5% to 7.5%, while net profit forecasts have been increased by 8% to 13% due to more optimistic expectations regarding BD revenue and operational cost rates [6][7]. - The report indicates a projected net profit of RMB 5,137 million for 2025, with a net profit margin of 17.1%, which is an improvement from previous estimates [5][11]. Market Performance - The company’s stock has shown a year-to-date increase of 59.41%, with a 52-week high of HKD 7.62 and a low of HKD 4.34, indicating significant volatility and potential for future growth [4][10]. - The report notes that the current stock price reflects the anticipated pressures on 2025 performance and future BD transactions, suggesting that the valuation multiples are reasonable with limited upside potential [6][10].

Investment Rating - The investment rating for the company is Neutral [4][10]. Core Insights - The first quarter performance met expectations, while the guidance for the second quarter is slightly below expectations. The first quarter revenue and profit were approximately in line with expectations, with total revenue showing a quarter-on-quarter increase of 1.1% and a year-on-year decrease of 41.4%. The automotive gross margin was 19.8%, which is better than market expectations and above the company's previous guidance of over 19% [2][3]. - The company expects second quarter revenue to be between 32.5 billion and 33.8 billion RMB, representing a quarter-on-quarter increase of 25.5% to 30.5%. Vehicle sales are projected to be between 123,000 and 128,000 units, with a quarter-on-quarter increase of 32.4% to 37.8% [3][9]. - The average selling price per vehicle is expected to decline by 13,000 RMB quarter-on-quarter, indicating potential pricing pressure in the upcoming quarter due to the transition between old and new models and increased inventory reduction efforts [3][9]. Financial Overview - Revenue projections for the company are as follows: 123.85 billion RMB in 2023, 144.46 billion RMB in 2024, and 157.98 billion RMB in 2025, with year-on-year growth rates of 173.5%, 16.6%, and 9.4% respectively [8][14]. - Net profit is expected to be 11.70 billion RMB in 2023, decreasing to 8.03 billion RMB in 2024, and then slightly increasing to 8.56 billion RMB in 2025 [8][14]. - The earnings per share (EPS) are projected to be 5.95 RMB in 2023, 4.03 RMB in 2024, and 4.29 RMB in 2025, reflecting a significant decline in 2023 followed by a modest recovery [8][14]. Market Performance - The company's stock has a 52-week high of 128.70 HKD and a low of 69.15 HKD, with a market capitalization of approximately 363.50 billion HKD [6][10]. - The average daily trading volume is 16.84 million shares, and the year-to-date change in stock price is 15.17% [6][10].

Investment Rating - The investment rating for the company is Neutral [4][10]. Core Insights - The first quarter performance met expectations, while the guidance for the second quarter is slightly below expectations. The company reported a total revenue increase of 1.1% quarter-on-quarter and a decrease of 41.4% year-on-year, with a gross margin of 19.8%, which is better than market expectations [2][3]. - The company expects second-quarter revenue to be between 32.5 billion and 33.8 billion RMB, representing a quarter-on-quarter increase of 25.5% to 30.5%, with vehicle sales projected at 123,000 to 128,000 units, a quarter-on-quarter increase of 32.4% to 37.8% [3][9]. - The average selling price per vehicle is expected to decline by 13,000 RMB quarter-on-quarter, indicating pricing pressure in the upcoming quarter due to the transition between old and new models and increased inventory reduction efforts [3][9]. Financial Overview - Revenue projections for the company are as follows: 123.85 billion RMB in 2023, 144.46 billion RMB in 2024, and 157.98 billion RMB in 2025, with year-on-year growth rates of 173.5%, 16.6%, and 9.4% respectively [8][14]. - Net profit is expected to be 11.70 billion RMB in 2023, decreasing to 8.03 billion RMB in 2024, and then slightly increasing to 8.56 billion RMB in 2025 [8][14]. - The company’s earnings per share (EPS) are projected to be 5.95 RMB in 2023, 4.03 RMB in 2024, and 4.29 RMB in 2025, reflecting a significant decline in 2023 followed by a modest recovery [8][14]. Market Performance - The company's stock has a 52-week high of 128.70 HKD and a low of 69.15 HKD, with a market capitalization of approximately 363.50 billion HKD [6][10]. - The average daily trading volume is 16.84 million shares, and the year-to-date change in stock price is 15.17% [6][10].

Group 1: Nvidia (NVDA US) - The report highlights that Nvidia has fully entered the Blackwell era, with a significant increase in inference demand, leading to a target price adjustment to $175, indicating a potential upside of +29.8% from the current price of $134.81 [3][4] - The short-term financial impact of export restrictions is less than expected, with asset impairment reduced to $4.5 billion from $5.5 billion, and revenue guidance for FY1Q26 and FY2Q26 set at $2.5 billion and $8 billion respectively [3][4] - Nvidia emphasizes the importance of the Chinese market, predicting that Blackwell will contribute nearly 70% of data center computing revenue, with the new GB300 Blackwell Ultra system starting testing this month [3][4] Group 2: Kingsoft (3888 HK) - Kingsoft's Q1 performance was affected by seasonal factors and increased R&D spending, particularly in AI and new game categories, with game revenue declining due to seasonal decreases in commercialization updates for "Jian Wang 3" [5] - The company plans to launch new games, including "Jie Xian Ji" in July and "Jian Xia Qian Yuan: Zero" at the end of May, which are expected to stabilize gaming revenue in the second half of the year [5] - The target price for Kingsoft has been adjusted down from HKD 50 to HKD 46, maintaining a buy rating due to changes in valuation contributions from Kingsoft Cloud [5] Group 3: Pharmaceutical Industry - The ASCO conference revealed that 71 original research results from Chinese pharmaceutical companies were selected for oral presentations, marking a record high and demonstrating the increasing international influence of Chinese innovative drugs [9][10] - The report suggests that the innovative drug sector is likely to attract attention and may lead to more outbound transactions, with market sentiment and sector valuations entering a positive recovery phase [9][10] - Investment recommendations include focusing on companies with rich short-term catalysts and high growth potential, such as Rongchang Biologics and Kangfang Biologics, as well as prescription drug companies like Xiansheng Pharmaceutical and Hansoh Pharmaceutical [10]

Investment Rating - The report assigns a "Buy" rating for NVIDIA (NVDA US) with a target price of $175.00, indicating a potential upside of 29.8% from the current price of $134.81 [10][11]. Core Insights - The report highlights the significant demand for reasoning applications, which is expected to drive long-term computational resource needs. The management emphasizes the importance of iterative reasoning in enhancing AI performance, with a notable increase in token usage for reasoning applications among major cloud service providers [5][6]. - NVIDIA's Blackwell product line is projected to contribute nearly 70% of data center computing revenue, with major cloud service providers deploying an average of 1,000 NVL72 Blackwell rack systems weekly [5]. - The report anticipates that the impact of export restrictions will be less severe than previously expected, with revenue guidance for FY2Q26 set at a median of $45 billion, and a Non-GAAP gross margin target of 72% [5][6]. Financial Overview - Revenue projections for NVIDIA are as follows: - 2024: $60,922 million - 2025: $130,497 million - 2026E: $210,221 million - 2027E: $267,431 million - 2028E: $285,823 million - Year-on-year growth rates are expected to be 125.9% for 2024 and 114.2% for 2025 [4][12]. - Net profit estimates are: - 2024: $32,312 million - 2025: $74,265 million - 2026E: $115,401 million - 2027E: $155,154 million - 2028E: $162,364 million - Corresponding year-on-year growth rates are 288.2% for 2024 and 131.1% for 2025 [4][12]. - The report also notes an increase in the Non-GAAP EPS forecast for 2025 and 2026 to $4.65 and $6.31, respectively, based on a 32x average P/E ratio for those years [5][6]. Market Position and Trends - The report indicates that NVIDIA's hardware compatibility is improving, aligning with trends in open-source software, which is seen as a positive direction for technological development [5]. - The anticipated demand for AI and reasoning applications is expected to keep computational resource needs high, with a shift from single-instance reasoning to iterative reasoning and eventually to agentic reasoning [5].

Investment Rating - The report maintains a "Buy" rating for the company, with a target price adjusted from HKD 50.00 to HKD 46.00, indicating a potential upside of 27.6% from the current price of HKD 36.05 [4][2]. Core Insights - The company's Q1 performance was impacted by seasonal factors and increased R&D expenditures, particularly in AI and new game categories. Game revenue saw a quarter-on-quarter decline primarily due to seasonal decreases in monetization updates for "Jian Wang 3," while WPS revenue also fell due to procurement process impacts [2][8]. - New game launches are anticipated to stabilize revenue in the second half of the year, with titles like "Jie Xian Ji" expected to launch in summer and "Jian Xia Qian Yuan: Zero" by the end of May [2][8]. - Adjustments to profit forecasts for 2025-2027 were made, reflecting changes in the valuation contribution from Kingsoft Cloud due to its declining market value [2][3]. Financial Performance Summary - **Revenue Projections**: - 2025E: RMB 11,184 million (down 4% from previous forecast) - 2026E: RMB 12,189 million (down 5%) - 2027E: RMB 13,486 million (down 5%) [3][12] - **Game and Other Revenue**: - 2025E: RMB 5,327 million (down 4%) - 2026E: RMB 5,354 million (down 8%) - 2027E: RMB 5,484 million (down 8%) [3][12] - **WPS Revenue**: - 2025E: RMB 5,857 million (down 3%) - 2026E: RMB 6,836 million (down 3%) - 2027E: RMB 8,002 million (down 3%) [3][12] - **Gross Profit**: - 2025E: RMB 9,281 million (up 6%) - 2026E: RMB 10,098 million (up 3%) - 2027E: RMB 11,204 million (up 14%) [3][12] - **Adjusted Net Profit**: - 2025E: RMB 2,724 million (down 1%) - 2026E: RMB 2,957 million (down 4%) - 2027E: RMB 3,461 million (down 3%) [3][12] Market Data - The company's market capitalization is approximately HKD 50,233.87 million, with a 52-week high of HKD 46.90 and a low of HKD 20.10. The average daily trading volume is 13.72 million shares, and the year-to-date change is 7.13% [6][12].

Investment Rating - The investment rating for the company is "Buy" with a target price adjusted from HKD 50.00 to HKD 46.00, indicating a potential upside of 27.6% from the current price of HKD 36.05 [4][2]. Core Insights - The company's Q1 performance was impacted by seasonal factors and increased R&D expenditures, particularly in AI and new game categories. Game revenue saw a quarter-on-quarter decline primarily due to seasonal decreases in monetization updates for "Jian Wang 3," while WPS revenue also fell due to procurement process changes. New game launches are expected to stabilize revenue in the second half of the year [2][8]. - Adjustments to profit forecasts for 2025-2027 were made, reflecting changes in the valuation contribution from Kingsoft Cloud due to its market value decline [2][3]. Financial Performance Summary - **Revenue Projections**: - 2025E: RMB 11,184 million (down 4% from previous forecast) - 2026E: RMB 12,189 million (down 5%) - 2027E: RMB 13,486 million (down 5%) [3][12]. - **Game and Other Revenue**: - 2025E: RMB 5,327 million (down 4%) - 2026E: RMB 5,354 million (down 8%) - 2027E: RMB 5,484 million (down 8%) [3]. - **WPS Revenue**: - 2025E: RMB 5,857 million (down 3%) - 2026E: RMB 6,836 million (down 3%) - 2027E: RMB 8,002 million (down 3%) [3]. - **Gross Profit**: - 2025E: RMB 9,281 million (up 6%) - 2026E: RMB 10,098 million (up 3%) - 2027E: RMB 11,204 million (up 14%) [3]. - **Adjusted Net Profit**: - 2025E: RMB 2,724 million (down 1%) - 2026E: RMB 2,957 million (down 4%) - 2027E: RMB 3,461 million (down 3%) [3]. Market Data - The company's market capitalization is approximately HKD 50,233.87 million, with a 52-week high of HKD 46.90 and a low of HKD 20.10. The average daily trading volume is 13.72 million shares, and the year-to-date change is +7.13% [6][12].

Investment Rating - The report maintains a "Buy" rating for Xiaomi Group-W (01810) and raises the target price to HKD 62 [1]. Core Insights - The report highlights that Xiaomi's 1Q25 performance exceeded expectations, with revenue and adjusted net profit reaching RMB 1,113 billion and RMB 107 billion, respectively, surpassing market forecasts [1]. - AIoT revenue grew significantly by 59% year-on-year to RMB 323 billion, with gross margin increasing from 20.5% in 4Q24 to 25.2% [1]. - The gross margin for the automotive segment improved to 23.2%, driven by scale effects from the SU7 model, high management efficiency, and growth in equity income [1]. Summary by Sections - **Revenue Forecasts**: The revenue forecasts for Xiaomi for 2025 and 2026 have been raised to RMB 5,030 billion and RMB 6,159 billion, respectively, with adjusted EPS estimates increased to RMB 1.87 and RMB 2.14 [1]. - **Automotive Business**: The average selling price (ASP) for Xiaomi's automotive segment has been adjusted down to RMB 254,000 for 2026, with a focus on the performance of the YU7 model post-launch and the ramp-up of production capacity [2]. - **Smartphone Market Position**: Xiaomi regained the top position in China's smartphone shipments in 1Q25, with a high-end market share of 25%, despite a global smartphone market growth forecast of less than 1% for 2025 [2]. - **AI Investment**: Management plans to increase investment in AI, expecting it to account for one-quarter of total R&D spending, with an annual R&D budget of RMB 30 billion [2]. - **Home Appliance Growth**: The report is optimistic about Xiaomi's long-term expansion in the home appliance sector, with significant growth in sales and ASP for major appliances, supported by the construction of a smart factory in Wuhan [2].

Investment Rating - The report maintains a "Buy" rating for China Power (02380) and raises the target price by 7.4% from HKD 3.51 to HKD 3.77 [1] Core Insights - The report indicates an increase in the earnings forecast for 2025 and 2026 by 1% and 1.4% respectively, highlighting an attractive dividend yield of 6% and 7% for these years [1] - Total power generation from January to April showed a slight year-on-year increase of 0.3%, with wind and solar power generation rising significantly by 32.1% and 13.6% respectively [1] - The report notes a decline of over 7% in domestic coal prices (both at ports and inland) compared to the end of March this year, suggesting that the company's thermal power price differential for the first half of the year may exceed the analyst's expectations by approximately 2% [1]

Investment Rating - The report maintains a "Buy" rating for Kuaishou-W (01024) with a target price of HKD 64, indicating a potential upside of 31% from the current price [1]. Core Insights - Kuaishou's Q1 performance met expectations with total revenue and adjusted net profit of RMB 32.6 billion and RMB 4.6 billion respectively, reflecting year-on-year growth of 11% and 4% [1]. - The report highlights the impact of increased AI computing power investments offsetting cost optimizations, maintaining the 2025 profit forecast at RMB 20.3 billion, with an adjusted net profit margin of 14%, stable compared to 2024 [1]. - The report emphasizes the commercial potential of Kuaishou's AI capabilities, particularly in video generation, warranting a valuation premium based on a 13x P/E ratio for 2025 [1]. Segment Overview - E-commerce GMV grew by 15% year-on-year, with MAU penetration at 19% and average spending per user also up by 7% [2]. - Online marketing revenue increased by 8% year-on-year, with content consumption and local life sectors showing strong growth [2]. - Live streaming revenue rebounded with a 14% year-on-year increase, alongside significant growth in the number of signed agencies and streamers [2]. - Local life services saw substantial growth in active merchants and product offerings, with monthly paid users increasing by 73% year-on-year [2]. - Internationally, revenue grew by 33% year-on-year, achieving positive operational profit for the first time [2]. - The report anticipates continued growth in Q2, with e-commerce GMV expected to rise by 14% and advertising revenue projected to recover with a double-digit growth rate [2].