Investment Rating - The report maintains an "Outperform" rating for the home appliance industry [7][12]. Core Insights - The home air conditioning market showed continued domestic sales growth in July, while external sales were weak, aligning with market expectations. The overall air conditioning sector remains stable, with the white goods sector underperforming the market from May to July. Leading companies in the white goods sector exhibit significant valuation and dividend yield advantages, making them worthy of investment consideration. Recommended companies include Midea Group, Haier Smart Home, Gree Electric, and Hisense Home Appliances [4][12]. Summary by Sections Air Conditioning Market Performance - In July 2025, the domestic air conditioning sales volume reached 10.58 million units, a year-on-year increase of 14.34%, while exports were 5.85 million units, down 15.47% year-on-year. The total production for the month was 16.12 million units, nearly unchanged from the previous year [8][13][15]. - The cumulative production from January to July 2025 was 136.43 million units, reflecting a year-on-year increase of 6.05%, with domestic sales at 77.13 million units, up 9.68% [14]. Domestic and External Sales Trends - Domestic sales continued to show double-digit growth in July, with a stable growth rate compared to previous months. The retail sector also saw significant increases, with online and offline retail volumes rising by 32% and 37% respectively [9][10]. - External sales faced challenges due to ongoing tariff impacts, with a notable decline in exports. The report highlights that the external sales environment remains uncertain, particularly with the potential for tariff changes [11][12]. Company-Specific Performance - In July, Haier's domestic sales increased by 58%, while Gree and Midea saw declines of 4.05% and 7.37% respectively. Hisense and TCL reported increases of 19.58% and stable performance [10][21][25]. - The report emphasizes the strong performance of leading companies like Haier and Hisense, while noting the weaker performance of others like Gree and Midea [10][12].

Core Viewpoint - Hisense has leveraged major sporting events like the UEFA European Championship and the FIFA Club World Cup to enhance its marketing efforts in Europe, resulting in significant revenue growth in the region's home appliance sector [1] Group 1: Company Performance - Hisense has increased its investment in key European markets, focusing on the mid-to-high-end product matrix [1] - The company has achieved rapid growth in home appliance revenue in Europe, with market shares across various categories showing improvement [1] - For the year 2024, Hisense's revenue from the white goods business in Europe is projected to grow by 35% year-on-year [1]

Group 1 - The core viewpoint is that the demand for air conditioners and fans has surged in Europe due to high temperatures exceeding 40°C since June, leading to significant export growth from China [1] - In the first seven months of the year, Zhongshan City exported air conditioners worth 2.48 billion yuan to Europe, marking a year-on-year increase of 36.8% [1] - A Guangdong company has successfully secured an order for 70,000 air conditioners for Dubai while also expanding its market presence in Africa and the Middle East, exporting a total of 300,000 units to these regions [1] Group 2 - According to a report by CITIC Securities, the home appliance industry remains in a high prosperity phase, driven by summer heat boosting air conditioner demand and structural upgrades in black electrical products [2] - The report indicates that the air conditioning sector is expected to maintain high production levels entering the new cooling year, with refrigerant demand likely to increase [2] - The market outlook for leading companies in the industry is positive, with expectations of stable performance in the second and third quarters [2] Group 3 - Related companies in the air conditioning sector include Midea Group (00300), Haier Smart Home (06690), Hisense Home Appliances (00921), and Xiaomi Group-W (01810) [3] - Companies involved in refrigerants include Dongyue Group (00189) [3]

Group 1 - The core viewpoint is that the demand for air conditioners and fans has surged due to high temperatures exceeding 40°C in several European countries since June [1] - In the first seven months of this year, Zhongshan City exported air conditioners worth 2.48 billion yuan to Europe, marking a year-on-year increase of 36.8% [2] - Guangdong Shunde has expanded its market efforts in Africa and the Middle East, successfully securing an order for 70,000 air conditioners in Dubai [2] Group 2 - From January to June, China's total air conditioner export value reached 9.35 billion USD, a nearly 10% year-on-year increase, with exports to EU countries rising by 43.2% to 3.76 billion USD, setting a record for the same period [2] - The home appliance industry remains highly prosperous, with expectations for strong performance from leading companies due to government subsidies and high demand driven by summer heat [2] - The cooling agent market is expected to see stable demand as air conditioner production is anticipated to remain high, with refrigerant prices expected to rise despite seasonal trends [3]

Core Viewpoints - The home appliance sector is expected to show steady growth in domestic sales despite the diminishing effects of national subsidies, with a return to stable growth anticipated in the second half of 2025 [3][25] - The valuation of the home appliance industry remains at a low level, with the industry index PE (TTM) at 14.45X, placing it at the 39.0 percentile since 2020 [13] - The report maintains an "outperform" rating for the home appliance sector, highlighting the resilience of major appliances and the recovery of small appliances [1][3] Summary by Sections 1. Overall Market Performance - In the first half of 2025, the home appliance sector slightly underperformed the market, with the sector index down 1.2% compared to the Shanghai and Shenzhen 300 index, which remained stable [10] - The home appliance sector's valuation is at a five-year low, with significant growth in home appliance components, which saw a rise of over 17% [10][11] 2. White Goods - Domestic sales of white goods benefited from national subsidy policies, showing strong resilience, with a projected steady growth in the second half of 2025 despite a slowdown in growth rates [4][19] - Major brands like Midea, Haier, Gree, and Hisense are recommended for investment due to their strong market positions and global production capabilities [4][17] 3. Black Goods - The black goods segment, particularly televisions, is experiencing stable demand with a shift towards Mini LED technology and decreasing panel prices, which are expected to enhance profitability for leading companies [40][44] - The domestic retail volume of televisions increased by 1.8% in the first half of 2025, with retail revenue growing by 7.5% [44] 4. Kitchen Appliances - The kitchen appliance sector is seeing a recovery in demand, particularly for traditional cooking appliances, driven by national subsidies, with retail sales of range hoods and gas stoves showing significant growth [53][54] - The overall demand for kitchen appliances is expected to stabilize as the effects of national subsidies wane, with a focus on the recovery of the real estate market to support future growth [55][57] 5. Small Appliances - The small appliance market, particularly kitchen appliances, is witnessing a notable recovery, with retail sales reaching 31.9 billion yuan, a year-on-year increase of 9.3% [65] - The demand for new cleaning products, such as robotic vacuum cleaners, has surged, with sales increasing by over 40% due to national subsidies [68][66] 6. Technology Integration - Leading home appliance companies are focusing on their strengths and expanding into emerging application areas, such as smart home technology and AI products, which are expected to drive long-term growth [4][28]

Core Viewpoint - Hisense is facing challenges in its home appliance segment despite revenue and net profit growth, with a need for strategic adjustments to compete effectively in a highly competitive market [1][2][8] Financial Performance - In the first half of 2025, Hisense Home Appliances reported revenue of 49.34 billion yuan, a slight increase of 1.44% year-on-year, and a net profit of 2.077 billion yuan, up 3.01% year-on-year [4][6] - The air conditioning segment remains the largest revenue contributor, generating 23.69 billion yuan, a growth of 4.1% [10][12] - The washing and refrigeration business saw revenue of 15.39 billion yuan, with a year-on-year growth of 4.8% [6] Market Position and Competition - Hisense is positioned in the second tier of the white goods market, facing intense competition from industry leaders like Midea, Haier, and Gree, which dominate nearly 70% of the air conditioning market [8][13] - The company’s growth rates in revenue and net profit are at their lowest in five years, contrasting sharply with the previous year's growth rates of 13.27% and 34.61%, respectively [8][9] Strategic Leadership Changes - The appointment of Gao Yuling as both Chairman and CEO marks a significant leadership change aimed at revitalizing the company’s growth strategy [15][17] - The introduction of experienced executives from Midea into key positions indicates a strategic shift to enhance operational efficiency and market competitiveness [14][15] International Expansion and Diversification - Hisense is focusing on international markets, with overseas revenue reaching 20.45 billion yuan, a growth of 12.34% year-on-year, particularly strong in Europe and the Americas [7][18] - The company is diversifying its product offerings, including a recent acquisition in the automotive supply chain, to explore new growth avenues [18][19] Technological Innovation - Hisense is investing in smart technology, particularly in air conditioning products, to enhance user experience and capture the younger consumer demographic [19] - The integration of AI technology into product development is seen as a critical factor for Hisense to maintain competitiveness in the evolving market landscape [19]

Group 1: Market Demand and Sales Growth - The overall transaction volume of air conditioners has increased by over 60% year-on-year from June to now, with the number of users placing orders growing by nearly 90% [1] - In July, transaction volume in Jilin, Liaoning, and Heilongjiang provinces increased by 25 times, 10 times, and 8 times respectively, with first-time buyers in these regions increasing by over 800% [1][2] - The demand for air conditioners in northern regions has surged due to high temperatures, breaking the traditional "cooler in the south, warmer in the north" pattern [2] Group 2: Supply Chain and Installation Challenges - Air conditioner manufacturers are facing new challenges in their supply chain and installation services due to the sharp increase in sales [2][3] - Companies have initiated "south-to-north" strategies to dispatch service teams to northern regions for urgent support, with installation requests in some areas increasing from around 2000 to 6000 [3] Group 3: Export Growth and International Demand - China's air conditioner exports reached 46.81 billion yuan in the first seven months of the year, a year-on-year increase of 4.9%, with exports to Europe growing by 28.9% [4] - The demand for Chinese air conditioners in Europe has surged, with Midea's sales in the European market increasing by 35% this year [5] Group 4: Product Innovation and Market Adaptation - Midea has introduced innovative products like the PortaSplit air conditioner, which is easy to install and has gained popularity in Europe, with sales exceeding 80,000 units [6] - Companies are focusing on energy-efficient and AI-driven technologies to meet the growing demand for air conditioning in Europe, where the market is rapidly transitioning to greener products [7] Group 5: Long-term Growth Potential - The International Energy Agency predicts that the number of air conditioners in the EU could double by 2050, presenting significant opportunities for Chinese manufacturers [7] - The ongoing demand for upgrades and technological advancements in air conditioning systems is expected to sustain long-term growth in the industry [7]

Company Overview - Hisense Home Appliances' stock price as of August 11, 2025, is 25.45 yuan, with a slight decrease of 0.01 yuan, representing a drop of 0.04% from the previous trading day [1] - The company reported a trading volume of 129,400 hands and a transaction value of 329 million yuan on the same day [1] Business Operations - Hisense Home Appliances specializes in the research, manufacturing, and sales of home appliances, including air conditioners, refrigerators, and washing machines [1] - The company holds a significant position in the home appliance manufacturing industry, particularly in the Guangdong region [1] Financial Performance - In the first half of 2025, Hisense Home Appliances ranked among the top ten listed companies in terms of net profit scale based on disclosed interim reports [1] - In the second quarter, the company saw new holdings from pension accounts amounting to 4.5961 million shares, which constitutes 0.50% of the circulating shares [1] Market Activity - On August 11, the net inflow of main funds into Hisense Home Appliances was 20.0563 million yuan, with a cumulative net inflow of 12.3702 million yuan over the past five trading days [1]

Investment Rating - The report maintains a recommendation for the home appliance industry [2] Core Viewpoints - The report analyzes the impact of the USMCA (United States-Mexico-Canada Agreement) and the potential risks posed by the U.S. government's tariff policies on Chinese home appliance companies operating in Mexico [6][8] - It emphasizes that the concerns regarding the USMCA's risks are primarily focused on two aspects: the potential for the U.S. government to invoke national security clauses and the upcoming review of the agreement in 2026 [6][8] - The report suggests that the short-term impact of the USMCA's implementation is limited, as many leading Chinese home appliance companies have already established significant production capacities in Mexico that comply with the agreement's rules [6][7] Summary by Sections Industry Basic Data - The home appliance industry consists of 80 listed companies with a total market value of 185.1 billion yuan and a circulating market value of 165.1 billion yuan [2] Relative Index Performance - The absolute performance of the industry over the past 1 month, 6 months, and 12 months is 0.3%, 1.1%, and 21.4% respectively, while the relative performance is -3.2%, -5.6%, and 3.0% [3] USMCA Agreement Analysis - The USMCA is designed to encourage regional production and supply chain integration, with specific rules for determining the origin of products [12][14] - The agreement provides trade benefits only to goods certified as originating from the USMCA region [12][14] - The report outlines two potential scenarios for the future of the USMCA: the continuation of the current tariff framework and the tightening of origin certification rules [55][58] Company Strategies - Leading Chinese home appliance companies like Haier, Midea, Hisense, and TCL have established substantial production capacities in Mexico, which allows them to mitigate tariff risks effectively [6][7][56] - The report highlights that these companies have the capability to meet the USMCA's origin certification requirements, thus reducing potential tariff impacts [6][7][57] - The white goods sector, particularly Haier, is expected to strengthen its market position in North America due to its localized production and supply chain flexibility [7][60] Market Dynamics - The report notes that while black goods manufacturers face challenges due to the concentration of LCD panel supply chains in Asia, they can still expand their market share through product upgrades [7][61] - The overall competitive landscape for Chinese home appliance companies has shifted from relying on cost advantages to focusing on brand development, operational efficiency, and product innovation [60]

Core Insights - Pension accounts have shown a significant investment presence in the capital market during the second quarter, appearing in the top ten shareholders of six stocks with a total holding of 51 million shares valued at 1.344 billion yuan [1][3]. Pension Holdings Distribution and Scale Characteristics - The holding structure of pension accounts at the end of the second quarter displayed a clear concentration, with Hongfa Co., Ltd. being the most held stock, where two pension fund combinations held a total of 28.22 million shares, accounting for 1.93% of the circulating shares [3]. - Other notable stocks favored by pension accounts include Jerry Holdings, Dongmu Co., Ltd., Hisense Home Appliances, Rongzhi Rixin, and Guomai Culture, with holdings of 6.27 million shares, 4.60 million shares, 3.50 million shares, and 1.93 million shares respectively [3]. - Five stocks held by pension accounts had a market value exceeding 100 million yuan, indicating a preference for sectors related to the real economy, such as power equipment, machinery, and home appliances [3]. Investment Strategy Adjustments and Changes in Holdings - Pension accounts demonstrated an active strategy of adjusting holdings in the second quarter, with three new entries and two increased holdings among the six stocks [4]. - New entries included Jerry Holdings, Hisense Home Appliances, and Guomai Culture, reflecting a positive outlook on these companies' growth prospects [4]. - Increased holdings were noted in Hongfa Co., Ltd. and Dongmu Co., Ltd., with share quantities growing by 64.93% and 43.23% respectively, indicating confidence in their long-term value [4]. - Rongzhi Rixin, the longest-held stock by pension accounts, maintained a holding of 3.50 million shares despite a 5.41% decrease from the previous quarter, representing the highest holding ratio at 4.04% of circulating shares [4]. - The distribution of the six stocks held by pension accounts included four from the main board and one each from the Sci-Tech Innovation Board and the Growth Enterprise Market, showcasing a balanced approach between stability and growth potential [4].