Market Overview - The Shanghai Composite Index is at 3894.62 points, above the five-day moving average, with an increase of 0.47% [1] - The total trading volume of A-shares is 12,225.01 billion yuan [1] Stocks Performance - A total of 591 A-shares have surpassed the five-day moving average, with notable stocks showing significant deviation rates [1] - The stocks with the highest deviation rates include: - Dezhong Automobile: 22.13% deviation, with a price increase of 30.00% [1] - Xingye Technology: 8.27% deviation, with a price increase of 10.01% [1] - Hanzhong Precision: 8.11% deviation, with a price increase of 9.99% [1] - Other stocks with smaller deviation rates include Tongrentang, China Satellite, and Hengyu Environmental Protection, which have just crossed the five-day moving average [1] Detailed Stock Data - The report includes a detailed table of stocks that broke the five-day moving average on September 18, with their respective trading performance, turnover rates, and deviation rates [1][2]

Core Insights - The A-share AI computing stocks experienced a rapid surge, leading the market, with the 5G Communication ETF (515050) rising nearly 3% as of 10:55 AM on September 18 [1] - Huawei's rotating chairman emphasized the importance of computing power for artificial intelligence, sharing future plans for Ascend chips, including the launch of Ascend 950PR in Q1 2026 and Ascend 970 in Q4 2028 [1] - The 5G Communication ETF has attracted over 260 million yuan in investments over the past two days, with a total scale exceeding 8 billion yuan, focusing on the supply chains of Nvidia, Apple, and Huawei [1] Company and Industry Summary - The 5G Communication ETF (515050) is heavily weighted towards optical communication stocks (42%) and PCB circuit board stocks (14%) [1] - Key stocks such as Guangku Technology surged over 17%, Hengtong Optic-Electric hit the daily limit, and Industrial Fulian rose nearly 8%, with the total market capitalization surpassing 1.3 trillion yuan [1]

Group 1 - The liquid cooling server sector has seen a rise in stock prices, indicating growing interest and potential in this market [1] - Companies such as Bojie Co., Ltd. (002975), Far East Holdings Group Co., Ltd. (600869), Dayuan Pump Industry Co., Ltd. (603757), and Hengtong Optic-Electric Co., Ltd. (600487) have reached their daily price limit [1] - Zhongke Shuguang (603019) has achieved a new intraday high in its stock price, reflecting strong market performance [1]

Core Viewpoint - The submarine cable industry in China is experiencing rapid growth driven by the expansion of offshore wind power and marine energy development, supported by comprehensive government policies and technological advancements [1][6][12]. Industry Overview - Submarine cables are essential infrastructure for connecting power and communication networks across oceans, categorized into submarine communication cables and submarine power cables [2][3]. - The industry is positioned as a strategic resource for supporting the digital transformation of the marine economy and the construction of a global energy internet [6]. Policy Analysis - China's policies, including the "14th Five-Year Plan" for renewable energy, aim to promote the large-scale development of offshore wind power and marine energy, providing a robust support system for the submarine cable industry [6][10]. Industry Chain - The submarine cable industry chain in China includes upstream raw material supply, midstream cable manufacturing, and downstream installation and operation, with leading companies like Zhongtian Technology, Hengtong Optic-Electric, and Dongfang Cable dominating the market [8][12]. Market Demand - The offshore wind power market is the primary driver of submarine cable demand, with installed capacity expected to grow significantly from 9 million kW in 2020 to 41.27 million kW by 2024, reflecting a compound annual growth rate of 46.33% [10][12]. - Marine energy is also a key market, with a target of 400,000 kW installed capacity by 2030, further expanding the demand for high-end submarine cables [11][12]. Current Industry Status - The submarine cable industry in China is in a phase of technological leadership and market expansion, with a projected market size of approximately 230 billion yuan by 2024 [12]. - The industry has achieved significant technological advancements, including a complete technical system covering voltage levels from 220kV to 500kV [12]. Competitive Landscape - The industry exhibits a concentrated oligopoly structure, with the top three companies—Dongfang Cable, Zhongtian Technology, and Hengtong Optic-Electric—holding a combined market share of 87% [13][14]. - International competitors like Prysmian and Nexans dominate the high-end market, while Chinese companies are expanding into emerging markets in Southeast Asia and Africa [13][14]. Future Development Trends - The submarine cable industry is expected to undergo a transformation towards high-end, intelligent, and green technologies, with a focus on dynamic cables and AI operation systems [16]. - The market is anticipated to expand globally, with emerging scenarios such as submarine data center interconnections and marine observation networks contributing to significant growth [17]. - The industry will evolve towards a collaborative ecosystem, enhancing supply chain resilience and establishing international standards [18][19].

Group 1: Macro Strategy and Market Overview - The report highlights a gradual convergence of overseas central bank policies, impacting asset allocation strategies [3][28] - In the A-share market, major indices saw significant gains in early September, with the CSI 100 and CSI 500 indices rising by 4.45% and 6.33% respectively [3][28] - The central bank's net cash injection was 196.1 billion yuan, maintaining a loose liquidity environment with DR007 staying below 1.48% [3][28] Group 2: Agricultural Bank of China - The Agricultural Bank of China is expected to benefit from the release of potential in county economies, with greater credit growth opportunities compared to peers [4] - The bank has the lowest non-performing loan ratio among its peers, with a strong ability to manage risks related to real estate exposure [4] - Future profit growth is projected at 1.98%, 3.94%, and 4.63% for 2025-2027, with corresponding BPS values of 7.69, 8.12, and 8.53 yuan [4] Group 3: Unmanned Forklifts Industry - The unmanned forklift market is experiencing rapid growth, with shipments increasing from 2,700 units in 2019 to an estimated 19,500 units in 2023, representing a penetration rate of 1.66% [6] - The market size for unmanned forklifts in China is projected to reach 2.385 billion USD in 2023, accounting for 45% of the global market [6] - Major players in the industry include Linde, Hangcha, and Geek+, with significant advancements in technology and market share [6][10] Group 4: Communication Sector - Runxin Technology - Runxin Technology reported a revenue of 1.358 billion yuan in H1 2025, marking a 16.42% year-on-year increase, with net profit rising by 18.23% [13][34] - The company is focusing on AIoT and automotive electronics, diversifying its revenue sources and enhancing long-term growth potential [34] - The firm has established strong partnerships with leading semiconductor suppliers, which bolsters its competitive edge in the market [34] Group 5: Semiconductor Testing Industry - Weicet Technology - Weicet Technology achieved a revenue of 634 million yuan in H1 2025, reflecting a 47.53% increase, with net profit soaring by 831.03% [36][39] - The company is expanding its testing capacity for high-end and reliable chips, with significant investments in new facilities [37] - The semiconductor market is expected to maintain optimistic growth, driven by advancements in AI and automotive electronics [39] Group 6: Pharmaceutical Sector - China Resources Pharmaceutical - China Resources Pharmaceutical reported a revenue of 131.867 billion yuan in H1 2025, a 2.5% increase, while net profit decreased by 20.3% due to impairment losses [21] - The company is focusing on external growth through acquisitions and innovation in its pharmaceutical business [21] - The firm has successfully launched 21 new products in H1 2025, with a robust pipeline of 476 projects under development [21]

Group 1 - The China Quality Conference held in Nanjing gathered around 600 representatives from over 30 countries to discuss quality management and its role in enhancing new productivity [1] - The fifth China Quality Award was presented at the conference, with Jiangsu Hengtong Optic-Electric Co., Ltd. and eight other organizations receiving the award, while 78 organizations and six individuals received nominations [1] - Hengtong Group's chairman emphasized that quality is both designed and manufactured, highlighting their unique quality management model developed over 30 years [1] Group 2 - Jiangsu province leads in quality infrastructure with 196 national and provincial quality inspection centers and 88 international and national standardization organizations [2] - A series of cooperation projects were signed during the conference, including a partnership between Yangzhou Municipal Government and a certification group to enhance industrial quality and promote green transformation [2] - The Jiangsu Institute of Metrology signed a strategic cooperation agreement with TÜV Rheinland to provide localized testing and certification services, marking a significant step in aligning Chinese manufacturing with EU standards [2]

Investment Rating - The report maintains a "Buy" rating for the company, with a target price not specified [7]. Core Views - The company achieved a revenue of 32.05 billion yuan in the first half of 2025, representing a year-on-year growth of 20.42%. The net profit attributable to shareholders was 1.613 billion yuan, with a slight increase of 0.24% [1]. - In Q2 2025, the company reported a revenue of 18.781 billion yuan, a year-on-year increase of 26.64%, while the net profit attributable to shareholders was 1.056 billion yuan, showing a decrease of 3.63% compared to the previous year [2]. - The company has secured multiple marine project contracts, with an order backlog of approximately 20 billion yuan in the energy interconnection sector, which is expected to support future growth [3]. - The company has demonstrated the capability for industrialization of various new types of optical fibers, including hollow-core fibers, which have achieved international advanced performance levels [4]. - The company is actively expanding production to meet future demand, with a new advanced optical fiber materials R&D and manufacturing center set to be completed by February 2026 [5]. - The company is strategically positioning itself in the AI sector, launching new cooling solutions and a full range of optical module products to support domestic supercomputing centers [6]. Financial Summary - The company’s gross margin for H1 2025 was 13.59%, with a net profit margin of 5.4%. In Q2, the gross margin was 13.56%, and the net profit margin improved to 6.05% [2]. - The forecast for net profit attributable to shareholders for 2025-2027 is adjusted to 3.3 billion, 4.1 billion, and 5 billion yuan respectively, with corresponding PE ratios of 15, 12, and 10 times [7]. - The company’s total assets are projected to grow from 62.49 billion yuan in 2023 to 85.54 billion yuan by 2027, indicating a strong growth trajectory [13].

Core Viewpoint - Hengtong Optic-Electric Co., Ltd. announced the approval of its 2024 employee stock ownership plan, allowing the allocation of a total of 6.21 million shares to eligible participants [1] Group 1 - The company will allocate a total of 6.21 million shares from the 2024 employee stock ownership plan and shares recovered from departing employees [1] - The allocation will be made to no more than three eligible participants [1] - The decision was made during the 23rd meeting of the 9th Board of Directors held on September 16, 2025 [1]

Core Viewpoint - The company has achieved a significant technological breakthrough in its hollow core anti-resonant optical fiber, reaching an international advanced level of loss at ≤0.2 dB/km, with ongoing improvements in attenuation loss [1] Group 1 - The hollow core anti-resonant optical fiber was showcased in July 2025, demonstrating the company's capability for mass delivery [1] - The company has independently innovated and established a comprehensive core preparation technology system [1] - The attenuation loss value is expected to decrease further, indicating rapid technological advancement [1] Group 2 - The company's AI advanced optical fiber materials R&D and manufacturing center expansion project is set to commence construction in 2025, with completion planned for February 2026 [1]

Core Viewpoint - The article highlights that Jiangsu Hengtong Optic-Electric Co., Ltd., a subsidiary of Hengtong Group, won the prestigious China Quality Award for its innovative "Four Full and Two-Sided" quality management model, marking it as the only award-winning enterprise in its industry this year [1][5]. Group 1 - The China Quality Award is the highest honor in the quality field in China, aimed at recognizing organizations and individuals that have made significant innovations in quality management models, methods, and systems [5]. - Hengtong Group's Chairman, Cui Genliang, emphasized that the award represents both honor and responsibility, and the company will use it as a new starting point to continue innovating in quality management [4][6]. - Hengtong has established a quality strategy focused on "independent research and innovation, controllable supply chains, creating value for customers, and ensuring national marine communication safety" [6][7]. Group 2 - The "Four Full and Two-Sided" quality management model is a culmination of Hengtong's years of practical exploration in quality management, driving the company towards high-end, intelligent, and green upgrades [7]. - Hengtong has implemented a "Digital Navigation" plan to promote digitalized quality management throughout its processes, establishing itself as a leader in smart manufacturing within the optical communication industry [7]. - This award marks a new height for Hengtong in quality management, following nominations in the second and third editions of the China Quality Award [7].