Core Viewpoint - China State Construction Engineering Corporation (CSCEC) reported a stable performance in the first half of 2025, with a slight decrease in revenue but an increase in net profit, indicating resilience in a challenging market environment [1][3]. Financial Performance - In the first half of 2025, the company achieved operating revenue of 1,108.31 billion yuan, a year-on-year decrease of 3.17% - The net profit attributable to shareholders reached 30.40 billion yuan, an increase of 3.24% year-on-year - Basic earnings per share (EPS) was 0.73 yuan, reflecting a year-on-year growth of 2.8% [1] Profitability Metrics - The gross margin for the first half of 2025 was 9.43%, up by 0.02 percentage points year-on-year - The net profit margin improved to 3.65%, an increase of 0.12 percentage points year-on-year - The period expense ratio showed improvement, with selling expenses down by 0.04 percentage points to 0.37%, management expenses down by 0.08 percentage points to 1.51%, and financial expenses down by 0.11 percentage points to 0.80% [1] Business Structure and Contract Performance - The total value of new contracts signed in the first half of 2025 was 2,501 billion yuan, a year-on-year increase of 0.9% - The construction business saw new contracts of 1,496.4 billion yuan, a decrease of 2.3%, while the infrastructure business grew by 10% to 823.7 billion yuan - The energy engineering sector led with a contract value of 350.1 billion yuan, marking a significant year-on-year increase of 34.2% [2] Real Estate Sector Insights - The real estate segment experienced a slight decline, with contract sales amounting to 174.5 billion yuan, down 8.9% year-on-year - The company added 5.2 million square meters of land reserves, with a total acquisition cost of 85.8 billion yuan, focusing on first-tier and second-tier cities [2] Investment Outlook - As a leading player in the global construction industry, the company has shown stable performance amid cyclical downturns in real estate and construction - The growth in new contracts, particularly in infrastructure, is expected to support future performance - The company is projected to have EPS of 1.17 yuan and 1.21 yuan for 2025 and 2026, respectively, with corresponding PE ratios of 4.76 and 4.58, suggesting a "buy" rating [3]

Group 1 - The second China-Egypt Sustainable Development Forum was held in New Cairo, Egypt, focusing on cooperation in smart cities and sustainable development between China and Egypt [1] - Over 130 participants from various sectors, including the Egyptian Ministry of Housing and Chinese institutions, engaged in discussions on infrastructure, smart cities, and green building [1] - The forum highlighted successful projects such as the new capital CBD and Alamein New City, showcasing the achievements of China-Egypt cooperation in sustainable construction [1] Group 2 - The forum's core theme was "Building Livable Smart Cities," with discussions covering 11 topics related to smart cities, intelligent construction, livable environments, and green development [2] - Key representatives from various organizations shared insights on policy guidance, academic research, design trends, and case studies, emphasizing the importance of sustainable development as a lifestyle [2] - The event included the release of a report on "Innovative Construction Technology for Egypt's Sustainable Development," focusing on advanced technologies like C80 high-performance concrete and BIM intelligent management systems [2]

Market Overview - The housing construction sector increased by 0.14% on September 2, with China State Construction leading the gains [1] - The Shanghai Composite Index closed at 3858.13, down 0.45%, while the Shenzhen Component Index closed at 12553.84, down 2.14% [1] Stock Performance - China State Construction (601668) closed at 5.60, up 0.72% with a trading volume of 2.9417 million shares and a turnover of 1.64 billion [1] - Other notable stocks included Chongqing Construction (600939) down 0.29%, Yihai Jian (600170) down 0.81%, and Shaanxi Construction (600248) down 1.30% [1] Capital Flow - The housing construction sector experienced a net outflow of 275 million yuan from institutional investors, while retail investors saw a net inflow of 214 million yuan [1] - The overall capital flow for the sector indicated a mixed sentiment, with retail investors showing some confidence despite the institutional outflow [1] Detailed Capital Flow Analysis - Chongqing Construction (600939) had a net outflow of 422,000 yuan from institutional investors and a net inflow of 320,000 yuan from retail investors [2] - Dragon Construction (600491) saw a net outflow of 6.4149 million yuan from institutional investors, with retail investors contributing a net inflow of 947,050 yuan [2] - Shaanxi Construction (600248) experienced a significant net outflow of 17.67% from institutional investors, while retail investors had a net inflow of 632,150 yuan [2]

Investment Rating - The report maintains a "Buy" rating for the construction and decoration industry, highlighting specific companies as key investment targets [4][7]. Core Insights - The construction sector has experienced significant fluctuations over the past sixteen years, with eight winning phases (40% of the time) and seven losing phases (60% of the time) [1][12]. - The current market environment is characterized by a gradual easing of policies since late 2021, which has historically correlated with better performance in the construction sector [1][3]. - The report emphasizes the importance of thematic influences, such as the "Belt and Road Initiative" and "PPP" projects, which have driven substantial short-term excess returns in the sector [2][3]. Summary by Sections 1. Historical Review of the Construction Sector - The report divides the historical performance of the construction sector from June 2008 to December 2024 into fifteen phases based on excess returns relative to the CSI 300 index [11]. - Winning phases include significant periods of policy easing and economic recovery, while losing phases often coincide with tighter monetary policies [1][12]. 2. Policy Cycle and Market Trends - The report identifies four major policy cycles since 2008, with the current phase being a gradual easing that began in late 2021 [1][3]. - The correlation between excess returns and macroeconomic indicators is noted to be weak, with expectations of policy changes being more influential [1][3]. 3. Thematic Characteristics and Valuation - The construction sector's valuation is currently low, with a price-to-book ratio (PB) of 0.8, which is below historical averages and indicates potential for rebound [2][3]. - The report highlights that the sector's performance is sensitive to thematic catalysts, suggesting that upcoming regional initiatives could provide investment opportunities [3][4]. 4. Comparison with Banking Sector - The construction sector is compared to the banking sector, noting similarities in business models and sensitivity to credit environment changes [3]. - The current price-to-book ratio of the construction sector relative to banks is at a critical point, suggesting potential for significant excess returns if historical patterns hold [3]. 5. Investment Recommendations - Key investment targets include leading companies benefiting from strategic infrastructure projects, such as Sichuan Road and Bridge, China Metallurgical Group, and China Communications Construction [4][7]. - The report also suggests monitoring local leaders in Xinjiang and companies involved in coal chemical projects as potential high-return investments [4].

Investment Rating - The report maintains an "Accumulate" rating for China State Construction Engineering Corporation (601668) [2][5]. Core Views - The company reported a steady performance in its 2025 interim results, with a revenue of 1,108.31 billion yuan, a year-on-year decrease of 3.17%, and a net profit attributable to shareholders of 30.40 billion yuan, an increase of 3.24% [5]. - The gross margin and net margin improved slightly, with a gross margin of 9.43% and a net margin of 3.65% for the first half of 2025 [5]. - The company continues to optimize its business structure, with significant growth in infrastructure and energy sectors, while the real estate sector experienced a slight decline [5]. Summary by Sections Financial Performance - In the first half of 2025, the company achieved a total revenue of 1,108.31 billion yuan, a decrease of 3.17% year-on-year, and a total profit of 49.83 billion yuan, an increase of 0.13% [5]. - The net profit attributable to shareholders was 30.40 billion yuan, reflecting a year-on-year increase of 3.24%, with basic earnings per share at 0.73 yuan, up 2.8% [5]. Margin Analysis - The gross margin for the first half of 2025 was 9.43%, up by 0.02 percentage points year-on-year, while the net margin was 3.65%, an increase of 0.12 percentage points [5]. - The company improved its expense ratios, with a sales expense ratio of 0.37%, a management expense ratio of 1.51%, and a financial expense ratio of 0.80% [5]. Business Segments - The total new contracts signed in the first half of 2025 amounted to 25,010 billion yuan, a year-on-year increase of 0.9% [5]. - The construction business saw new contracts of 14,964 billion yuan, down 2.3%, while the infrastructure business grew by 10% to 8,237 billion yuan [5]. - The real estate sector reported a contract sales amount of 174.5 billion yuan, a decrease of 8.9%, with a sales area of 6.33 million square meters, down 3.3% [5]. Investment Outlook - The report suggests that the company, as a leading player in the global construction industry, has shown resilience during the cyclical downturn in the real estate and construction sectors [5]. - The forecast for earnings per share (EPS) for 2025 and 2026 is 1.17 yuan and 1.21 yuan, respectively, with corresponding price-to-earnings (PE) ratios of 4.76 and 4.58 [5][7].

Core Viewpoint - The National Enterprise Win ETF (159719) has shown a positive performance with a recent increase of 0.63%, reflecting a broader trend of rising profits and dividends among Chinese listed companies, particularly state-owned enterprises [3][4]. Performance Summary - As of September 1, 2025, the National Enterprise Win ETF has achieved a net value increase of 51.31% over the past three years, ranking 215 out of 1860 index equity funds, placing it in the top 11.56% [4]. - The ETF has recorded a maximum monthly return of 14.61% since its inception, with the longest consecutive monthly gains reaching 7 months and a total increase of 24.70% [4]. - The average monthly return during rising months is 4.14%, with a total annual profit percentage of 100.00% and a historical three-year holding profit probability of 100.00% [4]. - Over the past three months, the ETF has outperformed its benchmark with an annualized return of 11.82% [4]. Liquidity and Scale - The ETF experienced a turnover rate of 6.84% with a trading volume of 4.9045 million yuan on September 1, 2025, and an average daily trading volume of 16.6744 million yuan over the past year [3]. - In the past week, the ETF's scale increased by 2.187 million yuan, ranking it in the top third among comparable funds [3]. - The number of shares increased by 2 million in the past week, also placing it in the top third among comparable funds [3]. Fee Structure and Tracking Precision - The management fee for the National Enterprise Win ETF is 0.25%, and the custody fee is 0.05%, which are the lowest among comparable funds [5]. - The tracking error for the ETF over the past month is 0.060%, indicating high tracking precision compared to similar funds [5]. Index Composition - The ETF closely tracks the FTSE China National Enterprises Open Win Index, which reflects the performance of Chinese state-owned enterprises listed in mainland China and Hong Kong, focusing on globalization and sustainable development [5]. - The index consists of 100 constituent stocks, including 80 A-share companies and 20 companies listed in Hong Kong [5]. Top Holdings - The top holdings in the National Enterprise Win ETF include: - China Petroleum (601857) with a weight of 15.94% and a price increase of 2.18% - China Petrochemical (600028) with a weight of 11.93% and a price increase of 1.40% - China State Construction (601668) with a weight of 9.59% and a price increase of 0.18% [7].

Core Insights - Wu Bingqi, Vice President of China State Construction, has joined the management team of Overseas Chinese Town, pending formal notification from the State-owned Assets Supervision and Administration Commission [1] - Wu's absence from the mid-year performance meeting on August 29, 2023, marks his first absence since assuming the vice presidency in September 2023 [1] - Wu's career spans across China Resources Group, China Resources Land, and China State Construction, showcasing his strong capabilities in real estate and cultural tourism operations [1] - His appointment comes at a critical time as the current chairman, Zhang Zhenggao, is nearing retirement, potentially facilitating a key step in Overseas Chinese Town's transformation in the "cultural tourism + real estate" sector [1]

Group 1 - The core viewpoint of the article highlights the movements of the social security fund's stock holdings, revealing that it appeared in the top ten circulating shareholders of 577 stocks by the end of the second quarter, with new investments in 136 stocks and increased holdings in 152 stocks [1][2] - The total number of shares held by the social security fund is 10.438 billion, with a total market value of 165.9 billion yuan [1] - Among the stocks held, 6 stocks have 4 social security funds appearing in their top ten shareholders, with the highest holdings in Changshu Bank, Sun Paper, and Hualu Hengsheng, holding 277.79 million shares, 151.11 million shares, and 132.68 million shares respectively [1][2] Group 2 - In terms of performance, 352 stocks held by the social security fund reported a year-on-year increase in net profit, with the highest increase being 15,646.55% for *ST Songfa [2] - The distribution of stocks held by the social security fund includes 405 on the main board, 93 on the ChiNext, and 79 on the Sci-Tech Innovation Board, with a concentration in the pharmaceutical, machinery, and basic chemical industries [2] - The average increase in the social security fund's heavy stocks since July is 16.35%, outperforming the Shanghai Composite Index, with the best performer being Yingweike with a cumulative increase of 169.81% [2]

Industry Overview - Self-adhesive membranes are a new type of waterproof material characterized by low-temperature flexibility, self-healing properties, and strong adhesion, allowing for quick construction at room temperature and compliance with environmental standards [1][2] - The production of self-adhesive membranes in China is projected to grow from 402 million square meters in 2015 to 1.477 billion square meters by 2024, driven by advancements in technology and expanding applications [1][8] Industry Development History - The self-adhesive membrane industry in China began in the 1990s with the introduction of products from international brands, followed by local production efforts [4] - By 2000, advancements in technology led to mass production of self-adhesive waterproof membranes, and industry standards were established in 2002 to ensure product quality [4][5] Industry Supply Chain - The supply chain consists of upstream raw material suppliers (asphalt, polymer resins, polyethylene films), midstream manufacturers who produce various self-adhesive membrane products, and downstream applications in construction and infrastructure [6] - The production of petroleum asphalt, a key component, has seen fluctuations, with a projected output of 34.508 million tons in 2024, down from 62.88 million tons in 2020 [6][7] Market Demand and Trends - The self-adhesive membrane industry is closely linked to the real estate sector, which is currently experiencing a downturn, impacting demand [7] - However, infrastructure investment remains robust, with a 3.2% year-on-year growth in the first half of 2025, providing some demand for self-adhesive membranes [7][8] Competitive Landscape - Major players in the self-adhesive membrane industry include Beijing Oriental Yuhong Waterproof Technology Co., Ltd. and Keshun Waterproof Technology Co., Ltd., which leverage technology and brand strength to maintain market leadership [9][11] - Smaller companies focus on niche products and regional markets due to limited resources compared to larger firms [9] Future Industry Trends - The industry is expected to see increased concentration as stricter environmental regulations and rising production costs lead to the elimination of less competitive firms [14] - Companies are expanding internationally to seek new growth opportunities, with notable efforts from leading firms to establish overseas operations [15] - Government policies are increasingly supportive of high-performance waterproof materials, enhancing the growth prospects for self-adhesive membranes [16]

Investment Rating - The investment rating for the company is "Buy" (maintained) [5] Core Views - The company is experiencing revenue pressure but is seeing improvements in profitability supported by infrastructure projects [5] - The revenue for the first half of 2025 was 1,108.31 billion yuan, a year-on-year decrease of 3.17%, while the net profit attributable to shareholders was 30.40 billion yuan, reflecting a growth of 3.24% [6] - The company is focusing on strategic emerging industries, which contributed 91.6 billion yuan in revenue, providing incremental momentum for business structure optimization [6] Financial Performance Summary - The company achieved a gross profit margin of 9.43% in the first half of 2025, with a net profit margin of 3.63% [6] - The total signed construction contracts amounted to 2,326.5 billion yuan, a year-on-year increase of 1.7%, with domestic contracts growing by 2.2% [6] - The company’s cash flow improved, with a net cash outflow from operating activities of 82.83 billion yuan, which was 25.94 billion yuan less than the previous year [6] Revenue and Profit Forecast - The forecast for net profit attributable to shareholders for 2025-2027 is 47.5 billion, 49.4 billion, and 51.2 billion yuan, with respective growth rates of 2.86%, 3.88%, and 3.73% [7] - The projected price-to-earnings ratios for the same period are 4.86, 4.68, and 4.51 times [7] Market Dynamics - The infrastructure sector continues to grow, while the real estate business is undergoing adjustments [6] - The company’s strategic focus on high-demand segments, such as energy and municipal engineering, is expected to drive future growth [6]