Core Viewpoint - The AI Fund Zhongtai Dividend Quantitative Stock Selection A (021167) reported a profit of 69,300 yuan in Q2 2025, with a net value growth rate of 0.58% for the period, and a total fund size of 12.2475 million yuan as of the end of Q2 2025 [3][16]. Fund Performance - As of July 17, the fund's unit net value was 1.066 yuan [3]. - The fund's performance over different periods includes a 4.66% growth rate over the last three months, 3.23% over the last six months, and 8.37% over the last year, ranking 93rd, 97th, and 92nd respectively among comparable funds [4]. Investment Strategy - The fund employs a quantitative investment strategy based on objective indicators, focusing on dividend yield, historical volatility, and stability of historical dividend yields when selecting stocks [3]. - The investment portfolio is constructed to minimize exposure to non-dividend-related factors such as scale and industry [3]. Portfolio Composition - As of Q2 2025, the fund's investment portfolio is heavily weighted in the industrial, financial, and consumer discretionary sectors [3]. - The top ten holdings include China National Offshore Oil Corporation, Agricultural Bank of China, China State Construction Engineering, Kweichow Moutai, China Merchants Bank, Anhui Conch Cement, Industrial and Commercial Bank of China, Gree Electric Appliances, Jiuli Special Materials, and Meihua Holdings [19]. Risk Metrics - The fund's Sharpe ratio since inception is 0.616 [9]. - The maximum drawdown since inception is 12.37%, with the largest quarterly drawdown occurring in Q2 2025 at 6.3% [11]. Fund Positioning - The average stock position since inception is 90.04%, compared to the industry average of 88.05%. The fund reached a peak stock position of 92.43% at the end of H1 2025 and a low of 85.08% at the end of Q3 2024 [14].

Core Viewpoint - The China Securities Hong Kong 300 Materials Index has shown significant growth, with a 41.40% increase year-to-date, indicating strong performance in the materials sector [1][2]. Group 1: Index Performance - The China Securities Hong Kong 300 Materials Index reported a value of 2311.34 points, with a 6.83% increase over the past month and a 23.83% increase over the past three months [1]. - The index is designed to reflect the overall performance of different industries in the Hong Kong market, classified according to the China Securities industry classification standards [1]. Group 2: Index Composition - The top ten holdings in the China Securities Hong Kong 300 Materials Index include Zijin Mining (26.28%), China Hongqiao (10.9%), and Zhaojin Mining (7.98%) among others [1]. - The index is fully composed of stocks listed on the Hong Kong Stock Exchange, with a 100% representation [1]. Group 3: Industry Breakdown - The industry composition of the index shows that non-ferrous metals account for 78.94%, non-metallic materials for 15.04%, chemicals for 4.62%, and paper and packaging for 1.41% [2]. - The index samples are adjusted biannually, with changes implemented on the next trading day following the second Friday of June and December [2].

Summary of Conference Call on Urban Development and Industry Insights Industry and Company Involved - **Industry**: Real Estate, Building Materials, Energy Drinks - **Companies Mentioned**: Dongpeng Beverage, Conch Cement, Taipai Group, Huaxin Cement, China Resources, Binjiang, Greentown, Jianfa Zhonghai Key Points and Arguments Urban Development and Real Estate Policy - The Central Urban Work Conference emphasizes a shift from large-scale expansion to improving existing urban stock, indicating a focus on urban renewal rather than large-scale stimulus, which benefits post-cycle industries like building materials and home appliances [1][2][3] - The policy aims to steadily advance the renovation of urban villages and dilapidated housing, avoiding a return to the monetization of shantytown renovations seen in 2015-2016, suggesting limited demand for incremental cyclical products [1][3][5] - The real estate market is transitioning from expansion to quality enhancement, focusing on improving existing housing quality and surrounding environments rather than new construction [1][6][7] Regional Market Performance - The real estate markets in first and second-tier core cities and their metropolitan areas are expected to outperform the national average, with regional developers like China Resources, Binjiang, Greentown, and Jianfa Zhonghai being noteworthy [1][8] Energy Drink Consumption Trends - Population movement significantly impacts energy drink consumption, with higher preferences in first and second-tier cities. As population density increases, energy drink consumption is expected to rise, making Dongpeng Beverage a recommended investment [1][9][10] - The consumption of energy drinks varies across provinces, with Guangdong leading in market share for Red Bull and Dongpeng, which is projected to maintain a 35% revenue growth rate [1][11] Building Materials Industry Insights - Urban renewal and village renovation will have limited demand pull for the building materials industry, with the consumption of building materials being most affected, particularly in segments like waterproofing, piping, and coatings [2][12][15] - The cement sector is expected to benefit from demand growth and supply-side reforms, with recommendations for Conch Cement, Taipai Group, and Huaxin Cement as investment targets due to their strong market positions and profitability [2][15][16] Market Outlook and Investment Strategy - The overall sentiment from the conference indicates a cautious approach to large-scale stimulus, with the market expected to remain within a relatively stable range [3][5] - Investment strategies should focus on a "barbell" approach, balancing technology and military sectors with dividend-paying assets like bank stocks and high-dividend service sector stocks [3] Conclusion - The conference highlights a significant policy shift in urban development and real estate, with implications for various industries. The focus on quality over quantity in housing and urban infrastructure suggests a need for investors to adapt their strategies accordingly, particularly in the building materials and consumer goods sectors.

Group 1 - China's Q2 GDP growth reached 5.2%, exceeding expectations, leading to a rally in Hong Kong stocks [1] - The Hang Seng Technology Index surged by 2.8%, while the Hang Seng Index and the National Enterprises Index rose by 1.6% and 1.65% respectively [1][2] - Major technology stocks performed strongly, with Alibaba rising nearly 7%, Meituan and Baidu up over 4%, and Tencent increasing by 3.5% [2][4] Group 2 - The cryptocurrency sector faced challenges, with Bitcoin dropping below $117,000, leading to a decline in related stocks [2] - Real estate development investment in China fell by 11.2% year-on-year in the first half of the year, impacting domestic property stocks significantly [2][13] - The construction materials and cement stocks also saw declines, with major players like Jinyu Group and Anhui Conch Cement dropping over 6% and 4% respectively [11][12] Group 3 - The innovative drug sector showed strength, with companies like BeiGene and CSPC Pharmaceutical rising over 7% [7][8] - Stablecoin-related stocks performed well, with Yunfeng Financial increasing by 19.5% and Weishi Jiajie up by 11% [9][10] - The entertainment sector saw gains, with China Star Group rising over 10% and Tencent Music increasing by over 5% [15] Group 4 - Southbound funds recorded a net inflow of HKD 3.824 billion, indicating strong interest in Hong Kong stocks [18] - Analysts noted a shift in investor sentiment towards undervalued stocks, with some funds looking to capitalize on recent price corrections in major internet companies [17]

Group 1: Special Electronic Fabrics - The demand for M8/M9 and second-generation/Q fabrics is expected to increase significantly, with high barriers to entry and few players in the market, leading to a prolonged period of prosperity [1] - The supply-demand dynamics for first-generation fabrics are anticipated to be better than market expectations [1] - Low CTE electronic fabrics continue to face shortages, with recommendations for Zhongcai Technology and attention to Honghe Technology [1] Group 2: Cement Industry - Cement stock configurations are becoming increasingly cost-effective, with negative factors already fully priced in; the industry is expected to maintain a bottom line [1] - Recommendations include Huaxin Cement and Conch Cement, with attention to China National Building Material and other companies [1][4] - National cement market prices have shown a slight decline of 0.4%, with regional price drops of 10-20 yuan/ton [4] Group 3: Glass Fiber Industry - The industry is entering a new normal, with stable prices for electronic yarn and a gradual recovery in profitability [5] - The main transaction price for 2400tex non-alkali yarn is between 3300-3700 yuan/ton, while electronic yarn prices remain stable at 8800-9200 yuan/ton [5] - Recommendations include leading companies such as China Jushi, Zhongcai Technology, and Changhai Co., with attention to International Composite Materials and Shandong Glass Fiber [5] Group 4: Pharmaceutical Glass - The upgrade of borosilicate glass is accelerating, with a favorable competitive landscape for molded bottles [6] - Recommendations focus on Shandong Pharmaceutical Glass, which is expected to see significant growth due to product upgrades and cost reductions [6] Group 5: Safety Building Materials - Qingniao Fire Protection is highlighted as a leading player with strong growth potential due to its comprehensive competitive advantages [10] - Zhenan Technology is expected to benefit from legislation opening up a significant market space for building isolation [10] - Zhizhi New Materials is positioned to increase its market share domestically and expand overseas, particularly in the Middle East and Southeast Asia [10]

Group 1 - The Hong Kong construction materials and cement stocks experienced a volatile rise, with China National Building Material (03323.HK) increasing by over 8% [1] - Jinju Group (02009.HK) and Anhui Conch Cement (00914.HK) both rose by more than 3.5% [1] - China Resources Cement Technology (01313.HK) saw an increase of over 2.5% [1]

Investment Rating - The investment rating for the construction materials industry is "Positive" (maintained) [1] Core Views - The Ministry of Housing and Urban-Rural Development emphasizes the importance of stabilizing the real estate market, which is expected to lead to significant improvements in the fundamentals of the real estate chain. Recommended stocks in the consumer building materials sector include Sankeshu, Dongfang Yuhong, Weixing New Materials, and Jianlang Hardware. Beneficiary stocks include Beixin Building Materials [3] - The National Development and Reform Commission has issued a special action plan for energy conservation and carbon reduction in the cement industry, aiming to control cement clinker capacity at around 1.8 billion tons by the end of 2025, with a target of reducing comprehensive energy consumption per unit product by 3.7% compared to 2020 [3] - The "equal tariff" policy is expected to benefit fiberglass leaders with overseas production bases, allowing them to raise prices and consolidate profitability [3] Market Performance - The construction materials index rose by 3.34% in the week from July 7 to July 11, 2025, outperforming the CSI 300 index by 2.52 percentage points. Over the past three months, the CSI 300 index increased by 6.41%, while the construction materials index rose by 6.60%, indicating a slight outperformance of 0.18 percentage points [4][13] - In the past year, the CSI 300 index increased by 15.62%, and the construction materials index rose by 15.80%, also showing a slight outperformance of 0.18 percentage points [4][13] Cement Sector - As of July 11, 2025, the average price of P.O42.5 bulk cement nationwide was 282.89 CNY/ton, a decrease of 3.48% month-on-month. The clinker inventory ratio was 65.89%, down 2.29 percentage points [6][23][24] - The price of cement varied by region, with notable declines in Northeast (-4.76%), North China (-2.33%), East China (-2.98%), South China (-5.74%), Central China (-3.41%), and Southwest (-4.93%) regions [23][29] Glass Sector - The average price of float glass as of July 11, 2025, was 1205.63 CNY/ton, with a slight increase of 0.17%. The average price of photovoltaic glass remained stable at 116.02 CNY/weight box [6][71][78] - The inventory of float glass decreased by 970,000 weight boxes nationwide, a decline of 1.66% [73][74] Fiberglass Sector - The price of non-alkali 2400tex direct yarn ranged from 3400 to 4100 CNY/ton, with flexible pricing based on regional differences [6] Consumer Building Materials - As of July 11, 2025, the price of crude oil was 70.63 USD/barrel, down 0.39% week-on-week. The price of asphalt was 4570 CNY/ton, up 1.11% week-on-week [6]

Investment Rating - The report maintains a positive outlook on the African building materials sector and local manufacturing leader Keda Manufacturing, particularly following the ignition of Keda's base in Côte d'Ivoire in June [1][13]. Core Insights - The Kenyan government has implemented a tiered tax on imported building materials, including a 3% export promotion tax on ceramic tiles and sanitary ware, aimed at reducing import dependency and fostering local manufacturing [1][13]. - The report emphasizes the importance of local production and consumption integration, highlighting Keda Manufacturing's efforts to establish local production in multiple African countries [1][13]. - The report identifies potential investment opportunities in the PCB upstream new materials sector, particularly in electronic cloth and copper foil, driven by high demand in AI applications [2][14]. - The waterproofing industry is experiencing frequent price increases, indicating a consensus among leading companies to curb malicious competition and stabilize prices [3][15]. - The cement sector is undergoing capacity reduction efforts, with the China Cement Association advocating for a unified approach to actual and registered production capacities [3][15]. Summary by Sections Weekly Discussion - Keda Manufacturing is recognized as a leader in local production within Africa, with recent developments in Côte d'Ivoire and supportive government policies in Kenya [1][13]. Cycle Interaction - Cement prices have shown a slight decline, with an average price of 347 RMB/t, down 46 RMB year-on-year, while glass prices have increased slightly to 1204.97 RMB/t [4][16]. - The report notes a stable demand for glass and fiberglass, with the latter maintaining a price of 3669 RMB/t [4][16][61]. National Subsidy Tracking - The report highlights government initiatives to boost consumption, including subsidies for building materials, which may benefit companies like Sangor and North New Materials [5][17]. Important Changes - Several companies, including Zhongcai Technology and China Jushi, have announced significant profit increases for the first half of 2025, indicating strong performance in the building materials sector [6][21].

Group 1 - The A-share market indices closed mixed, with the CSI 300 Construction Materials Index reported at 6031.14 points [1] - The CSI 300 Construction Materials Index has decreased by 2.36% over the past month, 9.83% over the past three months, and 5.89% year-to-date [1] - The CSI 300 Index categorizes its 300 sample stocks into 11 primary industries, 35 secondary industries, over 90 tertiary industries, and more than 200 quaternary industries [1] Group 2 - The CSI 300 Construction Materials Index is composed entirely of stocks from the Shanghai Stock Exchange, with a 100% allocation [1] - The index's holdings are exclusively in the cement and concrete sector, also with a 100% allocation [1] - The index samples are adjusted biannually, with adjustments occurring on the next trading day after the second Friday of June and December [2]

Group 1 - The core viewpoint of the news is the performance of the CSI 800 Materials Theme Index, which has shown significant growth over various time frames, indicating a positive trend in the materials sector [1][2] - The CSI 800 Materials Theme Index reported a value of 2899.41 points, with a 3.48% increase over the past month, a 12.06% increase over the past three months, and an 8.07% increase year-to-date [1] - The index is composed of listed companies in the materials sector selected from the CSI 800 Index, reflecting the overall performance of these companies [1] Group 2 - The top ten weighted companies in the CSI 800 Materials Theme Index include Zijin Mining (12.74%), Wanhua Chemical (4.0%), and Yilong Co. (2.48%), among others [1] - The market share of the index's holdings is predominantly from the Shanghai Stock Exchange (65.19%) and the Shenzhen Stock Exchange (34.81%) [1] - In terms of industry composition, non-ferrous metals account for 50.67%, chemicals for 32.62%, steel for 8.63%, non-metallic materials for 6.87%, and paper and packaging for 1.22% [2] Group 3 - The index samples are adjusted biannually, with adjustments occurring on the next trading day after the second Friday of June and December [2] - Weight factors are generally fixed until the next scheduled adjustment, with special circumstances allowing for temporary adjustments [2] - Companies that are delisted or undergo mergers, acquisitions, or splits are handled according to specific calculation and maintenance guidelines [2]