Summary of Huaqin Technology Conference Call Company Overview - **Company**: Huaqin Technology - **Industry**: Technology, specifically focusing on original design manufacturing (ODM) for smartphones, notebooks, wearables, AIOT, and server products Key Financial Highlights - **3Q25 Performance**: - Revenue growth of 23% year-over-year (yoy) - Net profit growth of 59% yoy - Gross Profit Margin (GPM) improved by 0.5 percentage points yoy - Despite a quarter-over-quarter (qoq) revenue decline of 8%, net profit increased by 16% qoq due to better performance in smartphones, wearables, and PCs [6][10][24] - **4Q25 Outlook**: - Anticipates continued earnings growth on a yoy basis - Targets smartphone shipments to exceed 180 million and notebook shipments to exceed 18 million in 2025, representing growth rates of over 30% and 20% respectively [6][10] Long-term Projections - **2030 Targets**: - Management aims for total revenue of Rmb300 billion by 2030 - Net profit target of Rmb10 billion, implying a compound annual growth rate (CAGR) of 23% from 2024 to 2030 - Growth driven by share gains in intelligent terminals, PCs, and strong datacenter growth projected at ~30% yoy in 2026 [6][10][20] Investment Rating and Price Target - **Current Rating**: Overweight (OW) - **Revised Price Target**: Rmb130 for June 2026, based on a 23x one-year forward P/E ratio, up from a previous target of Rmb115 [2][11][21] Market Position and Competitive Landscape - **Market Performance**: Huaqin shares have underperformed the sector index by 7 percentage points year-to-date (YTD) - **Concerns**: Investor concerns regarding GPU supply uncertainties may be overshadowing the company's solid growth potential in non-AI segments [6][10] Financial Estimates - **Revenue Projections**: - FY2025: Rmb169.861 billion - FY2026: Rmb187.863 billion - FY2027: Rmb213.980 billion - Expected revenue growth rates of 54.6% in FY2025 and 10.6% in FY2026 [9][17] - **Earnings Projections**: - Adjusted net income for FY2025: Rmb4.017 billion - Adjusted net income for FY2026: Rmb5.028 billion - Adjusted net income for FY2027: Rmb6.326 billion [9][17] Risks to Investment Thesis - **Downside Risks**: - Increased competition among ODMs affecting growth and margins - Potential supply constraints on GPUs - Risk of share price correction post-lock-up period expiration [22][20] Conclusion - Huaqin Technology is positioned for strong growth driven by its diversified business model and robust demand in key segments. The company’s ambitious long-term targets and recent performance suggest a positive outlook, despite some market concerns. The revised price target reflects confidence in the company's ability to capitalize on growth opportunities in both AI and non-AI sectors.

Core Insights - Recent data indicates a significant increase in international capital confidence towards the Chinese market, as evidenced by the presence of new foreign investors in A-share companies [1] - The return of foreign capital is seen as a logical outcome of valuation recovery, industrial upgrades, and global asset rebalancing, suggesting a long-term growth potential for A-shares and Hong Kong stocks [1] Group 1: New Foreign Investors - Traut Consulting has emerged as a new top shareholder in Yara International (000893), holding 8.5285 million shares, representing 1.05% of the circulating shares [2] - The Brunei Investment Agency has also entered the top ten shareholders of China International Capital Corporation (601995) with 10.3183 million shares, valued at approximately 381 million yuan [2] Group 2: Returning Foreign Players - Korea Bank has reappeared in the top ten shareholders of Hezhong Intelligent (603011) after more than a year, holding 1.8213 million shares valued at 35.7885 million yuan [3] - Quantitative trading firm Jane Street has returned to the top ten shareholders of A-share companies after more than two years, indicating a renewed interest in the market [3] Group 3: Increased Foreign Interest - HSBC reported a significant increase in foreign investors' exposure to the Chinese A-share market, marking the third consecutive month of net growth in foreign investment [4] - In August, foreign investors allocated nearly $45 billion to emerging market stocks and bonds, with a substantial portion directed towards the Chinese market, contrasting with capital outflows from other emerging markets [5] Group 4: Positive Market Outlook - Goldman Sachs anticipates a sustained upward trend in the Chinese stock market, projecting a 30% increase in major indices by the end of 2027 [5] - JPMorgan is optimistic about the performance of the CSI 300 index over the next year, highlighting that leading companies in healthcare, finance, and entertainment sectors are currently valued reasonably compared to their historical medians [5]

Core Insights - Huajin Technology achieved a net profit attributable to shareholders of 3.099 billion yuan in the first three quarters, representing a year-on-year increase of 51.17% [1] - In Q3 2025 alone, the net profit attributable to shareholders was 1.210 billion yuan, showing a year-on-year growth of 59.46% and a quarter-on-quarter increase of 15.53% [1] - The company's revenue for the first three quarters of 2025 surpassed the total revenue for the entire year of 2024, indicating strong growth across various business segments under the 3+N+3 strategy [1] Business Performance - The smart terminal business generated revenue of 45 billion yuan in the first three quarters, with smartphones, as a mature business, showing good growth [1] - The expected growth rate for smartphone shipments in 2025 is over 30%, indicating a significant growth potential in the future [1] - The company is continuously optimizing its customer structure and increasing efforts in market expansion, which is contributing to the gradual improvement of gross margins [1] Product Strategy - There is an increasing proportion of switches and general servers in the product mix, which is further supporting the enhancement of gross margins [1] - The company maintains a "buy" rating, reflecting confidence in its ongoing growth and strategic direction [1]

Core Insights - The demand for AI servers is rapidly expanding, leading major global cloud service providers (CSPs) to increase procurement of NVIDIA GPU solutions and expand data center infrastructure [1] - Capital expenditures for eight major CSPs, including Google, AWS, Meta, Microsoft, Oracle, Tencent, Alibaba, and Baidu, are projected to exceed $420 billion by 2025, representing a 61% year-on-year increase [1] - By 2026, total capital expenditures for CSPs are expected to reach a new high of over $520 billion, driven by the continued rollout of AI cabinet solutions [1] - Morgan Stanley forecasts that global cloud capital expenditures could reach $820 billion by 2026, with a year-on-year growth of 31%, significantly surpassing the market consensus of 16% [1] - Capital expenditures for AI servers are anticipated to grow by 70%, indicating an unprecedented growth trajectory [1] Industry Focus - The AI sector is identified as a high-growth investment theme with strong demand certainty, prompting recommendations to focus on companies such as Hon Hai Precision Industry, Huaqin Technology, Huadian Technology, Loongson Technology, Lenovo Group, Luxshare Precision, and Amlogic [1]

Core Insights - The demand for AI servers is rapidly expanding, leading major global cloud service providers (CSPs) to increase procurement of NVIDIA GPU solutions and expand data center infrastructure [1] - Capital expenditures for eight major CSPs, including Google, AWS, Meta, Microsoft, Oracle, Tencent, Alibaba, and Baidu, are projected to exceed $420 billion by 2025, representing a 61% year-on-year increase [1] - By 2026, total capital expenditures for CSPs are expected to reach a new high of over $520 billion, driven by the continued rollout of AI cabinet solutions [1] - Morgan Stanley forecasts that global cloud capital expenditures could reach $820 billion by 2026, a 31% year-on-year growth, significantly surpassing the market consensus of 16% [1] - Capital expenditures for AI servers are anticipated to grow by 70%, indicating an unprecedented growth trajectory [1] Industry Focus - The AI sector remains a high-growth investment theme with strong demand certainty, prompting recommendations to focus on companies such as Hon Hai Precision Industry, Huaqin Technology, Huadian Technology, Loongson Technology, Lenovo Group, Luxshare Precision, and Amlogic [1]

Core Insights - The company reported strong financial performance for the first three quarters of 2025, achieving revenue of 128.88 billion yuan, a year-on-year increase of 69.56%, and a net profit attributable to shareholders of 3.099 billion yuan, up 51.17% year-on-year [1] Group 1: Financial Performance - In Q3 2025, the company achieved revenue of 44.943 billion yuan, a year-on-year increase of 22.75% but a quarter-on-quarter decrease of 8.17% [1] - The net profit attributable to shareholders for Q3 2025 was 1.210 billion yuan, reflecting a year-on-year increase of 59.46% and a quarter-on-quarter increase of 15.53% [1] - The company's gross profit margin for Q3 2025 was 8.17%, an increase of 0.54 percentage points year-on-year and 1.04 percentage points quarter-on-quarter [1] Group 2: Business Segments Growth - All four major business segments reported revenue growth exceeding 70% year-on-year [1] - The smart terminal business saw revenue growth of 84.4% year-on-year, while the high-performance computing segment grew by 70% [1] - The AIoT and other businesses experienced a revenue increase of 72.9%, and the automotive and industrial products segment grew by 77.1% [1] Group 3: Future Outlook - The smart terminal business is expected to achieve a smartphone shipment growth rate exceeding 30% in 2025, benefiting from increased ODM penetration and market share gains among leading ODM manufacturers [2] - The data center business is projected to maintain double-digit revenue growth, with expectations of exceeding 40 billion yuan in revenue for the year [2] - The automotive electronics segment is anticipated to surpass 1 billion yuan in revenue for the first time this year, with continued investment in this area [2] Group 4: Investment Recommendations - The company is expected to achieve net profits attributable to shareholders of 4.006 billion yuan, 4.940 billion yuan, and 5.987 billion yuan for 2025, 2026, and 2027 respectively, with corresponding EPS of 3.94, 4.86, and 5.89 yuan [2] - The projected PE ratios for the same years are 25.8, 20.9, and 17.3 times [2]

Core Insights - The consumer electronics sector experienced a significant increase of 5.24% on October 29, with Tonglian Precision leading the gains [1] - The Shanghai Composite Index closed at 4016.33, up 0.7%, while the Shenzhen Component Index closed at 13691.38, up 1.95% [1] Consumer Electronics Sector Performance - Tonglian Precision (688210) closed at 59.98, with a rise of 12.55% and a trading volume of 115,200 shares, amounting to a transaction value of 665 million yuan [1] - Industrial Fulian (601138) saw a closing price of 80.80, increasing by 9.20% with a trading volume of 1,991,900 shares, resulting in a transaction value of 15.896 billion yuan [1] - Hongxi Technology (920857) closed at 30.42, up 8.84%, with a trading volume of 32,800 shares and a transaction value of 9.629 million yuan [1] - Other notable performers included Haosheng Electronics (920701) with a 7.59% increase, Huqin Technology (603296) with a 5.19% increase, and Weiliu Electronics (920346) with a 5.05% increase [1] Capital Flow Analysis - The consumer electronics sector saw a net inflow of 1.174 billion yuan from institutional investors, while retail investors experienced a net outflow of 167 million yuan [2][3] - Major stocks like Industrial Fulian and Lixun Precision had significant net inflows from institutional investors, indicating strong institutional interest [3] - Conversely, stocks such as YN Industrial and Huizhi Technology faced notable net outflows from retail investors, suggesting a shift in sentiment among smaller investors [3]

关于向专业投资者公开发行科技创新公司债券 注册申请获得中国证监会批复的公告 本公司董事会及全体董事保证本公告内容不存在任何虚假记载、误导性 陈述或者重大遗漏，并对其内容的真实性、准确性和完整性承担法律责任。 近日，华勤技术股份有限公司（以下简称"公司"）收到中国证监会出具的 《关于同意华勤技术股份有限公司向专业投资者公开发行科技创新公司债券注 册的批复》（证监许可[2025]2327 号）（以下简称"批复"），现将批复内容公告如 下： 华勤技术股份有限公司 证券代码：603296 证券简称：华勤技术 公告编号：2025-102 一、同意公司向专业投资者公开发行面值总额不超过 20 亿元科技创新公司 债券的注册申请。 二、本次发行科技创新公司债券应严格按照报送上海证券交易所的募集说明 书进行。 三、本批复自同意注册之日起 24 个月内有效，公司在注册有效期内可以分 期发行科技创新公司债券。 四、自同意注册之日起至本次科技创新公司债券发行结束前，公司如发生重 大事项，应及时报告并按有关规定处理。 公司将按照有关法律法规和批复文件的要求及公司股东大会的授权，积极推 进相关工作，并及时履行信息披露义务。 特此公告。 ...

Group 1 - The Computer ETF (159998) has risen by 0.28% as of October 28, 2025, marking its fourth consecutive increase, with a turnover rate of 4.25% and a transaction volume of 121 million yuan [3] - The Computer ETF (159998) has seen a cumulative increase of 3.82% over the past week, ranking first among comparable funds, with a significant growth in scale of 8.639 million yuan [3] - The Tianhong Sci-Tech Index ETF (589860) has a turnover rate of 11.44% and a transaction volume of 40.4241 million yuan, indicating active market trading [3] Group 2 - The Computer ETF (159998) covers a wide range of sectors including information technology services, application software, and communication equipment, featuring leaders in AI applications and hardware manufacturing [4] - The Tianhong Sci-Tech Index ETF (589860) covers 97% of the market capitalization of the Sci-Tech board, with a balanced allocation in strategic emerging industries such as semiconductors and artificial intelligence [4] - The U.S. Department of Energy has announced a collaboration with NVIDIA and Oracle to build seven new AI supercomputers, emphasizing the importance of AI in scientific research [5] Group 3 - The quantum technology market is expected to exceed $6.1 billion globally by 2025, with China's market projected to reach 11.56 billion yuan, reflecting a compound annual growth rate of over 30% [6] - CITIC Securities highlights the need to accelerate innovation in AI and digital technologies, predicting significant growth in capital expenditure related to AI model development [7]

Group 1: Macro Insights - The "14th Five-Year Plan" has established a clear direction for the "15th Five-Year Plan," emphasizing foundational consolidation and comprehensive efforts, with a focus on "common prosperity" and strengthening "internal circulation" [6] - The plan identifies four strategic emerging industries and six future industries, aiming to promote key core technology breakthroughs in six priority areas through extraordinary measures [6] Group 2: Fixed Income - Er Yong Bonds - Recent market conditions have led to a decline in risk appetite, benefiting Er Yong bonds with both interest rate and spread reductions [7] - The supply of Er Yong bonds remains weak, continuing the trend of asset scarcity, while the monthly turnover rate has remained stable [7] - The pricing model suggests that the yield of 5-year AAA-rated secondary capital bonds may decline to approximately 2.07% next year [7] Group 3: Banking Sector - Precious Metals - The banking sector is expected to see growth in precious metals business despite challenges from high volatility in the gold market [8] - As of September 2025, China's official gold reserves reached 74.06 million ounces, marking an increase for 11 consecutive months, with a global trend of central banks increasing gold reserves [8] - The introduction of pilot programs for insurance funds to invest in gold is creating new opportunities for banks to provide services and increase intermediary income [8] Group 4: Textile and Apparel - Baoxini - Baoxini's revenue is expected to stabilize, with a projected decline in net profit due to ongoing adjustments in its main brand [12] - The company is anticipated to achieve a net profit of 2.95 billion, 3.74 billion, and 4.49 billion yuan from 2025 to 2027, maintaining a "buy" rating [12] Group 5: Food and Beverage - Haitian Flavoring - Haitian Flavoring reported a revenue of 21.628 billion yuan for the first three quarters of 2025, reflecting a year-on-year increase of 6.02% [13] - The company is expected to benefit from its leadership position in the industry and aims for significant growth in overseas markets [13] Group 6: Computer Industry - Zhongke Chuangda - Zhongke Chuangda's revenue for Q3 2025 reached 1.848 billion yuan, a year-on-year increase of 42.87% [15] - The company is projected to achieve net profits of 606 million, 695 million, and 782 million yuan from 2025 to 2027, maintaining a "buy" rating [15] Group 7: Home Appliances - Hisense - Hisense's profitability has slightly declined, but the company remains optimistic about its long-term globalization strategy [16] - The projected net profits for 2025 to 2027 are 3.398 billion, 3.771 billion, and 4.154 billion yuan, with a "hold" rating [16] Group 8: Coal Industry - China Coal Energy - China Coal Energy reported a revenue of 110.584 billion yuan for the first three quarters of 2025, a year-on-year decrease of 21.24% [27] - The company is expected to achieve net profits of 16 billion, 17.1 billion, and 18.5 billion yuan from 2025 to 2027, maintaining a "buy" rating [27] Group 9: Automotive - Huguang - Huguang's revenue for the first three quarters of 2025 was 5.84 billion yuan, reflecting a year-on-year increase of 6% [34] - The company is expanding its customer base and enhancing its overseas market presence, which is expected to drive future growth [34]