Group 1 - The automotive stocks mostly rose, with Chery Automobile (09973) up 3.61% to HKD 31.58, GAC Group (02238) up 3.52% to HKD 3.53, Leap Motor (09863) up 3.27% to HKD 52.05, Beijing Automotive (01958) up 3.02% to HKD 2.05, and XPeng Inc. -W (09868) up 1.46% to HKD 83.3 [1] - On November 27, the State Council Information Office held a regular press conference to introduce policies aimed at enhancing the adaptability of supply and demand for consumer goods, with a focus on promoting automotive consumption [1] - The Ministry of Commerce's official stated that commodity consumption is a crucial area for promoting consumption and improving people's livelihoods, with plans to advance automotive circulation reforms, expand used car markets, and develop automotive aftermarket services [1] Group 2 - Everbright Securities released a report indicating that the end-of-year peak season and the reduction of vehicle purchase tax may lead to record high orders by the end of the year, emphasizing the importance of model cycles [1] - The firm forecasts a slight year-on-year decline in domestic passenger vehicle retail sales for 2026, while exports of new energy passenger vehicles are expected to maintain rapid growth, stabilizing overall wholesale sales for the year [1] - CITIC Construction Investment pointed out that the automotive industry has three investment directions: cyclical growth, expansion, and overseas markets, suggesting a focus on industry structure and trends rather than total domestic demand expectations as policy expectations weaken in 2026 [1]

Group 1 - The majority of automotive stocks have risen, with notable increases in Chery Automobile (up 3.61% to HKD 31.58), GAC Group (up 3.52% to HKD 3.53), and Leap Motor (up 3.27% to HKD 52.05) [1] - The State Council's policy briefing on November 27 highlighted measures to enhance the adaptability of supply and demand in consumer goods, with a focus on promoting automotive consumption through reforms in the automotive circulation market [1] - The Ministry of Commerce plans to expand the second-hand car market and develop automotive aftermarket sectors such as modifications, rentals, events, and RV camping to boost overall automotive consumption [1] Group 2 - Everbright Securities forecasts that the end of 2025 will see a peak in orders due to the reduction of vehicle purchase tax, emphasizing the importance of model cycles [1] - Citic Construction Investment notes that the automotive industry has three investment directions: cyclical growth, expansion, and internationalization, suggesting a shift in focus from domestic demand to industry structure and trends as policy expectations weaken in 2026 [1]

Group 1 - The core viewpoint of the article highlights a significant increase in Hong Kong automotive stocks, driven by government initiatives to boost automobile consumption and streamline the automotive market [1][3] - The Ministry of Commerce plans to promote reforms in automotive circulation and consumption, focusing on expanding the second-hand car market and enhancing various automotive-related sectors such as rentals and modifications [1][3] - Analysts suggest that the new policy aims to address consumer pain points throughout the automotive lifecycle, including challenges in purchasing, using, and selling vehicles, thereby stimulating consumption potential more sustainably than mere price cuts or tax reductions [1] Group 2 - GAC Group saw a stock price increase of over 4%, while other companies like Leap Motor and Beijing Automotive also experienced gains of 3.5% and 3.5% respectively [2] - Xpeng Motors reported a remarkable 149% year-on-year increase in third-quarter sales, indicating strong growth potential [3] - GAC Group announced the establishment of China's first large-capacity all-solid-state battery production line, contributing to its stock price surge [3]

Core Viewpoint - Zhongtai Securities initiates a "Buy" rating for Chery Automobile (09973), highlighting its strong export capabilities and first-mover advantage, with expectations for simultaneous growth in volume and profit due to orderly advancement of domestic new energy brands and deep collaboration with Huawei [1] Group 1: Industry Insights - The shift in core capabilities for automakers emphasizes demand control and the pace of electrification as critical for market share growth, moving away from traditional product cycles [2] - The competitive landscape has evolved post-2021, with domestic and joint venture brands increasing their market share through strategic adjustments [2] Group 2: Growth Review - Chery's market share has significantly increased since 2017, transitioning from reliance on low-cost small cars to a focus on quality and export growth [3] - The company has experienced a resurgence and growth phase from 2017 to 2021, marked by improved product strength and successful sub-brand strategies [3] - The current explosive growth phase (2022-present) is characterized by technological advancements and a rapid transition to new energy vehicles, leading to record sales [3] Group 3: Current Development Status - Chery's internal combustion vehicle lineup, particularly the Aiyre and Ruihu series, continues to perform well, supporting overall growth [4] - The Wind and Cloud sub-brand is beginning to show results in the new energy transition, while the Jietu and Zhijie brands are developing independently [4] - Financially, Chery is projected to achieve revenues of 269.9 billion yuan in 2024, a year-on-year increase of 65.4%, and a net profit of 14.14 billion yuan, up 18.3% year-on-year [4] Group 4: Core Competitiveness - Chery's first-mover advantage in exports has created a strong competitive moat, with leading engine technology and smart capabilities enhanced by Huawei [5] - The company has established a stable increase in export volumes, focusing on regions such as Europe, Latin America, and Southeast Asia, with overseas production capacity reaching approximately 1 million units [5] - The new Kunpeng engine boasts a thermal efficiency of 48%, the highest globally, with production capacity expected to double by 2026 [5] Group 5: Future Outlook - Chery plans to focus on the Wind and Cloud brands for market penetration, with significant advancements in technology and product offerings [6] - The company aims to enhance its domestic oil vehicle market share, which has increased by 4.1 percentage points over the past three years, positioning it as the second-largest among domestic brands [6] - Continued expansion in key overseas markets is anticipated to contribute positively to profits [6]

Core Viewpoint - Zhongtai Securities initiates a "Buy" rating for Chery Automobile, highlighting its strong export capabilities and first-mover advantage, with expectations for simultaneous growth in volume and profit due to orderly domestic new energy brand advancement and deep collaboration with Huawei [1] Group 1: Industry Analysis - The shift in core capabilities for automakers emphasizes demand control and the pace of electrification as critical for market share growth, moving away from traditional product cycles [2] - The competitive landscape has evolved post-2021, with domestic and joint ventures increasing market share through strategic adjustments [2] Group 2: Growth Review - Chery's market share has significantly increased since 2017, transitioning from reliance on low-cost vehicles to a focus on quality and exports, leading to record sales [3] - The company has experienced a growth phase from 2022 onwards, marked by technological advancements and a strong export performance, making it the top Chinese brand in exports [3] Group 3: Current Development - Chery's internal combustion engine (ICE) vehicles continue to perform well, with the Wind and Cloud series contributing to both volume and profit growth [4] - Financially, Chery is projected to achieve revenues of 269.9 billion yuan in 2024, a year-on-year increase of 65.4%, and a net profit of 14.14 billion yuan, up 18.3% [4] Group 4: Competitive Advantages - Chery's first-mover advantage in exports has created a strong competitive moat, with leading engine technology and collaboration with Huawei enhancing its smart capabilities [5] - The new Kunpeng engine boasts a thermal efficiency of 48%, with production capacity expected to reach 1 million units by 2026 [5] Group 5: Future Outlook - Chery plans to focus on the Wind and Cloud brands for market capture, with significant improvements in technology and product offerings aimed at meeting consumer demands [6] - The company has seen a 4.1 percentage point increase in domestic market share for ICE vehicles over the past three years, positioning it as the second-largest domestic brand [6] - Continued expansion in key overseas markets such as Europe, Latin America, and Southeast Asia is expected to contribute to profit growth [6]

Investment Rating - The report assigns a "Buy" rating for Chery Automobile (09973.HK) for the first time [2]. Core Insights - Chery has demonstrated significant growth in both domestic and export markets, with a focus on electric and intelligent vehicle integration. The company has successfully transitioned from a low-cost strategy to enhancing product quality and brand value, leading to a substantial increase in market share [5][21]. - The financial forecasts indicate a strong revenue growth trajectory, with projected revenues of CNY 269.9 billion in 2024, representing a year-on-year increase of 65.4%, and a net profit of CNY 14.1 billion, up 18.3% year-on-year [5][32]. Summary by Sections Company Overview - Chery's total share capital is approximately 5.81 billion shares, with a market capitalization of around HKD 175.77 billion as of November 25, 2025 [2]. Financial Performance - Revenue projections for Chery are as follows: - 2023: CNY 163.2 billion - 2024: CNY 269.9 billion (up 65%) - 2025: CNY 289.7 billion (up 7%) - 2026: CNY 325.1 billion (up 12%) - 2027: CNY 359.1 billion (up 10%) [2][78]. - Net profit forecasts are: - 2023: CNY 11.95 billion - 2024: CNY 14.1 billion (up 18%) - 2025: CNY 17.3 billion (up 23%) - 2026: CNY 21.9 billion (up 26%) - 2027: CNY 24.3 billion (up 11%) [2][78]. Market Position and Strategy - Chery has established itself as a leader in exports, with a focus on enhancing its product lineup and expanding into new markets, particularly in Europe, Latin America, and Southeast Asia. The company has also made significant advancements in engine technology, with the new Kunpeng engine achieving a thermal efficiency of 48%, the highest globally [5][44][68]. - The company is integrating its various brands, including the high-end brand Starway and the electric brand Windcloud, to streamline operations and enhance market competitiveness [5][50]. Future Outlook - The report anticipates continued growth in Chery's market share, particularly in the fuel vehicle segment, with a projected increase in sales driven by the successful launch of new models and ongoing improvements in engine technology [5][62]. - The company is expected to maintain a strong focus on electric vehicle development, with the Windcloud brand positioned to capture market share in the competitive landscape [5][52]. Valuation and Investment Recommendation - The projected price-to-earnings (P/E) ratios for Chery from 2025 to 2027 are 9.2X, 7.3X, and 6.6X, respectively, which are below the industry average, reinforcing the "Buy" rating [2][82].

Core Viewpoint - The article highlights the significant inflow of southbound capital into the Hong Kong stock market, driven by the increasing presence of high-quality Chinese companies and the attractiveness of valuations, which is expected to support a long-term "slow bull" market trend in Hong Kong stocks [3][10][16]. Group 1: Southbound Capital Inflow - As of November 10, southbound capital's cumulative net purchase of Hong Kong stocks exceeded 5 trillion HKD, continuing to grow [3]. - By November 19, southbound capital net inflow through the Stock Connect reached 65.91 million HKD, bringing the total net purchase for the year to over 1.34 trillion HKD, a 66% increase compared to the total inflow of 807.8 billion HKD in 2024 [5][6]. - The proportion of southbound capital in the total trading volume of the Hong Kong market has steadily increased from 15.6% at the beginning of 2024 to 23.6% in the third quarter of 2025 [6]. Group 2: Investment Trends and Sector Focus - The composition of southbound capital has shifted significantly, with technology and dividend-paying stocks becoming the primary focus, moving away from the banking sector, which previously dominated [7][8]. - The top ten holdings of southbound capital are now split between technology and high-dividend stocks, with Tencent Holdings and Alibaba being major players [8]. - Insurance funds and public funds are the main contributors to southbound capital, with insurance holdings surpassing 1 trillion RMB by the end of the third quarter [9]. Group 3: Future Growth Potential - Analysts predict that the southbound capital inflow could increase by 1.4 trillion RMB (approximately 1.54 trillion HKD) by the end of next year, with a potential growth of 10 trillion RMB (about 11 trillion HKD) over the next five years [11][13]. - The continuous inflow of long-term capital is expected to enhance market liquidity and optimize the capital market structure, supporting a sustainable "slow bull" market [13][14]. Group 4: Quality of Listed Companies - The article notes that more high-quality Chinese companies are choosing to list in Hong Kong, which enhances the market's attractiveness to both domestic and foreign investors [15][17]. - As of November 19, 2025, 88 companies have gone public in Hong Kong, raising a total of 250.5 billion HKD, a 172.44% increase from the previous year [17]. - The increasing number of globally competitive companies listed in Hong Kong is expected to attract more capital inflow, creating a positive feedback loop [18].

Core Insights - The Hong Kong stock market is becoming a crucial platform for global investors to share in the growth dividends of China's core assets, with significant inflows of southbound capital [1][12] - As of November 10, southbound capital's cumulative net purchases of Hong Kong stocks exceeded 5 trillion HKD, continuing to grow [1] - The influx of long-term mainland funds, primarily from insurance and public offerings, is expected to support a "slow bull" market in Hong Kong [1][8] Southbound Capital Inflows - As of November 19, southbound capital net inflows through the Stock Connect reached 65.91 million HKD, bringing the total for the year to over 1.34 trillion HKD, a 66% increase compared to the total inflow of 807.8 billion HKD in 2024 [2] - Cumulative net inflows since the launch of the Stock Connect have surpassed 5 trillion HKD [2][3] Market Dynamics - Southbound capital has become a core driver of liquidity in the Hong Kong stock market, with its share of total market turnover rising from 15.6% at the beginning of 2024 to 23.6% by the third quarter of 2025 [3] - The total market value of southbound capital holdings exceeded 6.3 trillion HKD by the end of the third quarter, representing a year-on-year increase of over 90% [3] Sector and Stock Preferences - The allocation of southbound capital has shifted significantly, with the banking sector previously dominating but now more evenly distributed across industries, including media, pharmaceuticals, and technology [3][4] - The top ten holdings of southbound capital are now characterized by a "technology + dividend" strategy, with Tencent Holdings and Alibaba being major beneficiaries [4] Fund Composition - Insurance funds and public funds constitute the majority of southbound capital, with insurance holdings surpassing 1 trillion RMB (approximately 1.4 trillion HKD) by the end of the third quarter [7] - Public fund holdings reached 1.01 trillion RMB, accounting for about 18% of total southbound capital [7] Future Projections - Predictions indicate that southbound capital could see an additional inflow of 1.4 trillion RMB (approximately 1.54 trillion HKD) by the end of next year, with a potential total increase of 10 trillion RMB (approximately 11 trillion HKD) over the next five years [8] - The continuous inflow of long-term capital is expected to enhance market fundamentals and support a "slow bull" market [8][9] Market Valuation and Asset Supply - The Hong Kong stock market is viewed as having significant allocation value, with lower valuation levels compared to other major global markets [11] - The influx of quality companies listing in Hong Kong is creating a virtuous cycle, enhancing market liquidity and attracting more capital [12][13] Historical Context - Historical analysis indicates that periods of outperformance in the Hong Kong stock market have been driven by the scarcity of assets, with current trends reflecting similar dynamics as seen in previous advantageous periods [14]

Market Overview - The Hong Kong stock market indices experienced declines, with the Hang Seng Tech Index falling by 0.69%, reaching a new low since early September. The Hang Seng Index and the Hang Seng China Enterprises Index decreased by 0.38% and 0.26%, respectively [1][2]. Technology Sector - Major technology stocks mostly declined, with Xiaomi dropping nearly 5%, Kuaishou down over 1%, and slight declines in JD.com, Meituan, Baidu, and Tencent. Alibaba saw an increase of over 1% [2][4][5]. New Energy Vehicle Sector - Stocks in the new energy vehicle sector fell, including Li Auto, NIO, Chery, Beijing Automotive, BYD, and Leap Motor [6]. Semiconductor Sector - Semiconductor stocks experienced declines, with companies like Shanghai Fudan, Jingmen Semiconductor, and Zhongxing Communications reporting losses [7][8]. Gold Sector - Gold stocks led the market gains, with China Gold International rising over 8%. Other gold-related stocks also saw increases, driven by expectations of significant gold purchases by global central banks [9][10]. Military Industry - Military stocks performed well, with China Shipbuilding Industry rising over 9%. Analysts expect the military industry to enter an upward cycle, supported by recent quarterly reports indicating a narrowing decline in performance [11][12]. Oil Sector - Oil stocks saw an uptick, with China Petroleum & Chemical Corporation increasing nearly 3%. This rise is attributed to recent increases in crude oil futures prices [13]. Lithium Battery Sector - Lithium battery stocks gained, with Tianqi Lithium rising nearly 3%. The market for lithium carbonate has shown significant recovery, with prices expected to rise further due to increasing demand [15][16]. Market Sentiment - The market sentiment remains cautious, with expectations of continued adjustments in the Hong Kong stock market due to weak macro liquidity and corporate earnings forecasts. Investors are advised to wait for clearer signals from U.S. monetary policy and mainland economic data before seeking rebound opportunities [21].

Group 1 - Hong Kong Stock Exchange announced that Zijin Mining International Co., Ltd. (02259) and Chery Automobile Co., Ltd. (09973) will be included in the designated securities list for short selling starting from November 21, 2025 [1]