26 August 2025 | 3:39PM HKT Luxshare (002475.SZ): 3Q25 guidance / 2Q25 results in line; NM sequentially improved in 2Q25 with diversifying end markets; Buy We are positive on Luxshare given its market share gain in iPhones, and the upcoming form factor changes in two consecutive years to support the end market demand and supply chain. The company's diversification into non-smartphone market is also a solid support to its long term growth. 2Q25 revenues increased by 2% QoQ, while net income was up by 18% QoQ ...

Group 1: Central-Local Fiscal Relations - The report discusses the historical, current, and future analysis of central-local fiscal relations, indicating that reforms may focus on cultivating local tax sources, moderately centralizing fiscal responsibilities, and promoting fiscal system reforms below the provincial level [5]. - It highlights that the macro tax burden is decreasing and land finance is waning, making it essential to cultivate new tax sources for local governments, with a projected increase in local revenue of approximately 209.3 billion yuan from consumption tax reforms [5]. - The report suggests that the central government may take on more fiscal responsibilities in areas with broader impacts, such as higher education, public health, and social security, to alleviate local fiscal pressures [5]. Group 2: Computer Industry - Cambrian Technology - Cambrian Technology reported a significant revenue increase of 4,348% year-on-year for H1 2025, reaching 28.81 billion yuan, with a net profit of 1.038 billion yuan, reflecting a 296% increase [9][10]. - The company maintained a gross margin of 55.88% in Q2 2025, indicating stable profitability despite rapid revenue growth, with expectations for strong cash flow and inventory recovery in Q3 [10][11]. - The report anticipates that the AI wave will significantly boost demand for computing power, with Cambrian positioned to benefit from increased domestic market share in the face of geopolitical challenges [11][12]. Group 3: Food and Beverage Industry - Nongfu Spring - Nongfu Spring reported a revenue of 25.622 billion yuan for H1 2025, a year-on-year increase of 15.6%, with a net profit of 7.622 billion yuan, up 22.1% [20]. - The company is expected to continue recovering market share in packaged water and is focused on innovation in beverage products, projecting net profits of 14.6 billion yuan by 2027 [20]. Group 4: Environmental Sector - Huahong Technology - Huahong Technology experienced significant profit growth in H1 2025, driven by improved cost control and the recovery of rare earth prices, with expectations for rapid growth as new capacities come online [21]. - The report maintains a "buy" rating, emphasizing the company's strong position in the recycling of rare earths and the anticipated demand from the automotive sector [21]. Group 5: Real Estate Sector - China Overseas Property - China Overseas Property reported a revenue increase of 3.7% in H1 2025, with a net profit of 7.69 billion yuan, reflecting a 4.3% growth [24]. - The company is focusing on optimizing its service structure and expanding its management area, with expectations for continued growth in the property management sector [25].

Core Insights - Lixun Precision (002475.SZ) continues to experience rapid growth, with a reported revenue of 124.5 billion yuan for the first half of 2025, marking a year-on-year increase of 20.18%, and a net profit of 6.644 billion yuan, up 23.13% [1][2] Financial Performance - The company's revenue from communication and precision components reached 11.098 billion yuan, a significant increase of 48.65%, accounting for 8.91% of total revenue [1][2] - Consumer electronics generated 97.799 billion yuan in revenue, reflecting a growth of 14.32% and representing 78.55% of total revenue [1][2] - The overseas revenue for the first half of 2025 was 105.726 billion yuan, up 17.38%, making up 84.82% of total revenue, while domestic revenue was 18.777 billion yuan, increasing by 38.82% and accounting for 15.08% [1][8] R&D Investment - R&D expenses reached 4.594 billion yuan, an increase of 8.86% [4] - The company allocates approximately 30% of its R&D budget to cutting-edge technology innovations, focusing on foundational materials, processes, and techniques [4] - Over the past three years, Lixun Precision has invested a total of 25.192 billion yuan in R&D and currently holds 7,164 patents [4] Future Outlook - The company anticipates a net profit of between 10.89 billion yuan and 11.344 billion yuan for the first three quarters of 2025, representing a growth of 20% to 25% compared to the previous year [6] - Lixun Precision is in the process of an IPO in Hong Kong, expected to raise over 1 billion USD, with funds primarily directed towards global strategic expansion [7][8] - The company aims to enhance its operational efficiency and cost control through "smart manufacturing upgrades" and "underlying technology innovations" [6]

Core Insights - Lixun Precision (002475) reported a total revenue of 124.5 billion yuan for the first half of 2025, a year-on-year increase of 20.18%, and a net profit attributable to shareholders of 6.644 billion yuan, up 23.13% year-on-year [1] - The company's second-quarter revenue reached 62.715 billion yuan, reflecting a 22.51% increase compared to the same period last year, with a net profit of 3.601 billion yuan, up 23.09% year-on-year [1] - The accounts receivable as a percentage of net profit reached 231.05%, indicating a significant amount of receivables relative to profit [1][26] Financial Performance - Gross margin was reported at 11.61%, a decrease of 0.81% year-on-year, while net margin improved to 5.86%, an increase of 5.4% [1] - Total expenses (selling, administrative, and financial) amounted to 3.559 billion yuan, accounting for 2.86% of revenue, which is a 2.09% increase year-on-year [1] - Earnings per share (EPS) increased to 0.92 yuan, a rise of 22.67% year-on-year, while operating cash flow per share was -0.23 yuan, a significant decrease of 168.4% [1] Balance Sheet Changes - Cash and cash equivalents increased by 50.94% to 58.565 billion yuan, attributed to improved performance ensuring normal payments [3] - Accounts receivable rose by 23.68% to 30.881 billion yuan, influenced by seasonal fluctuations and the collection of overdue accounts [3] - Interest-bearing liabilities increased by 55.37% to 91.25 billion yuan, indicating a rise in debt levels [1] Investment and Cash Flow - The company reported a 244.08% increase in trading financial assets, driven by investments in foreign exchange and wealth management [14] - Net cash flow from operating activities decreased by 169.05%, primarily due to payments to suppliers for overdue accounts [25] - The company’s return on invested capital (ROIC) was 11.81%, indicating average capital returns [25] Market Position and Analyst Sentiment - Analysts expect Lixun Precision's performance in 2025 to reach 16.289 billion yuan, with an average EPS forecast of 2.25 yuan [26] - The company is held by several prominent fund managers, with notable increases in holdings from certain funds [27] - The leading fund manager, Xie Zhiyu from Xingquan Global Fund, has a strong track record in identifying value and growth stocks [26]

Group 1 - The "A+H" listing model is gaining momentum, with nearly 20 A-share companies announcing plans to list in Hong Kong since August, indicating a strategic move towards internationalization [1][2] - The new IPO regulations effective from August 4 have provided significant impetus for this trend, allowing for a more flexible allocation mechanism and reducing compliance costs for A-share companies [1][2] - Companies like Greeenme have explicitly stated that their goal for listing in Hong Kong is to enhance their global strategy and improve their international brand image and competitiveness [1][3] Group 2 - Enterprises with large asset scales, high capital expenditures, and mature international operations are becoming the main players in the "A+H" model, utilizing the Hong Kong market for financing to support cross-border mergers and overseas expansions [2] - The "A+H" model is reshaping the valuation system and liquidity structure of Chinese listed companies, with significant foreign capital inflows into Hong Kong stocks, surpassing last year's total by 90% as of mid-2025 [2] - The dual listing structure helps mitigate valuation risks associated with market volatility, as seen with companies like CATL, which attracted substantial international long-term capital post-listing [2][3] Group 3 - There is a noticeable shift in the types of companies pursuing "A+H" listings, with more emerging sectors like renewable materials and biomedicine entering the fray, reflecting a deeper integration of China's tech industry with international capital markets [3] - The continued support from policies and the optimization of related systems are expected to propel the "A+H" model into a new phase of high-quality development, with more competitive Chinese companies likely to pursue this path for global capital and strategic positioning [3] - The maturation of the "A+H" model is a natural outcome of the ongoing deepening of China's capital market openness and a strategic choice for companies to enhance their international competitiveness [3]

Core Insights - The Hong Kong IPO market has raised over 123 billion HKD this year, ranking among the top global exchanges [1][2] - A total of 11 A-share companies have successfully listed on the Hong Kong Stock Exchange (HKEX) this year, with 49 more in the queue [1][2] - The trend of A-share companies listing in Hong Kong is driven by policy support and a recovering capital market, indicating a new upward cycle for the A+H model [1][9] Group 1: IPO Performance - The Hong Kong IPO market has shown strong recovery, with over 50 new stocks listed and total fundraising exceeding 123 billion HKD as of August 26 [2][9] - Among the A-share companies, the top three—CATL, Hengrui Medicine, and Haitian Flavoring—account for nearly 80% of the total fundraising from A+H listings [3][4] - The average market capitalization of the listed A-share companies is significantly high, with most exceeding 200 billion HKD [2][7] Group 2: Market Trends - The A+H listing trend is expanding, with over 49 A-share companies already in the queue for HKEX, including several industry leaders [7][8] - The market is witnessing a notable phenomenon where H-shares of some leading companies are trading at higher valuations than their A-shares, indicating strong international capital interest [4][9] - Analysts predict that the Hong Kong IPO market will continue to accelerate, supported by improved liquidity and favorable policies [9][10] Group 3: Future Outlook - Deloitte forecasts that 80 new stocks will be listed in Hong Kong in 2025, raising 200 billion HKD, with 25 of these being A+H listings [11] - The ongoing reforms in the Hong Kong market are expected to attract more quality companies and enhance the market's asset quality and liquidity [10][11] - The A+H listing wave is anticipated to improve the structure of the Hong Kong market, attracting more capital and reinforcing its position as a key investment hub [10]

今年以来，港股市场IPO募资总额超1230亿港元，位居全球交易所前列。宁德时代、恒瑞医药、海天味 业等一批A股市值超过千亿元的龙头企业相继登陆港交所，成为A+H上市热潮中的主力军。 截至8月26日，今年以来共有11家A股上市公司成功登陆港股市场，49家A股上市公司已在港交所排队， 还有超40家A股上市公司已公告拟在港交所上市，但目前尚未递表。从市值构成上看，在已排队港交所 的A股上市公司中，不乏立讯精密、牧原股份、赛力斯等千亿市值龙头公司，近八成公司市值均在200 亿元以上。 行业人士认为，A股上市公司赴港上市热潮的背后有政策支持、资本市场回暖等因素共同推动，今年港 股IPO市场有望加速回暖，A+H模式正进入新一轮上行周期。 ● 本报记者 吴玉华 葛瑶 行业龙头成A+H上市排头兵 2025年以来，港股IPO市场展现出强劲的复苏势头，募资市场活跃度较去年同期大幅提升。Choice数据 显示，截至8月26日，港股市场有超过50只新股成功挂牌交易，募资总额超1230亿港元，这一募资规模 居全球交易所前列。其中，A股上市公司表现尤为抢眼，今年已有11家在港交所挂牌上市，合计首发募 集资金突破800亿港元。 值得关注的 ...

Group 1: Consumer Electronics Sector - The consumer electronics sector showed strong performance on August 26, with stocks like GoerTek hitting the daily limit up [3] - The industry is experiencing a gradual recovery, with leading company Luxshare Precision expecting a net profit of 10.89 billion to 11.344 billion yuan for the first three quarters of 2025, representing a year-on-year growth of 20% to 25% [3] - The third quarter is traditionally a peak season for consumer electronics, with major releases of AI smartphones and AR glasses anticipated [3][4] Group 2: Livestock Sector - The livestock sector also performed well, with companies like Xiaoming Co. and Aonong Biological achieving significant gains [6] - Leading pig farming company Muyuan Foods reported a revenue of 76.463 billion yuan for the first half of the year, a year-on-year increase of 34.46%, and a net profit of 10.53 billion yuan, up 1169.77% [6] - The company aims to reduce its pig farming costs to an average of 12 yuan per kilogram by the end of the year, with current costs already decreasing [6] Group 3: Market Outlook - Analysts suggest that certain industries may have opportunities for rebound, particularly those that have not returned to their September 2021 highs [7] - The market is expected to maintain a positive trend, driven by ample liquidity and the influx of long-term capital [7] - The technology sector is likely to see increased market activity due to supportive policies and the entry of new capital [7]

Group 1 - The consumer electronics sector in A-shares is experiencing a significant surge due to major announcements from Huawei and Apple, with stocks like Fenda Technology and GoerTek hitting the daily limit [1] - The third quarter is identified as a golden season for consumer electronics, with Huawei's Mate 80 and Apple's iPhone 17 series launches expected to drive demand [3] - Companies in the domestic supply chain, such as Lens Technology and Luxshare Precision, are showing strong performance, with Lens Technology's net profit increasing by 32.68% in the first half of the year [3] Group 2 - The integration of AI technology into consumer electronics is accelerating hardware upgrades, with devices like the Xiaomi 14 and Huawei's HarmonyOS 4.0 showcasing enhanced capabilities [4] - The long-term outlook for consumer electronics is positive, as companies involved in foundational technologies for AI, such as Lens Technology and those developing Micro LED and waveguide technologies, are positioned for growth [4] - Industrial Fulian, a leader in AI servers with a global market share of 40%, reported a 35% revenue increase in the first quarter, highlighting the importance of strong fundamentals for long-term investors [4]

Core Viewpoint - The "A+H" listing trend is gaining momentum, with nearly 20 A-share companies announcing plans to list in Hong Kong since August, indicating a strategic move towards internationalization and capital market access [1][2]. Group 1: A+H Listing Trend - Companies like Grinmei, Huqin Technology, and Kexing Pharmaceutical are among those pursuing Hong Kong listings, highlighting the effectiveness of the "A+H" dual-track model for international expansion [1]. - The new IPO regulations effective from August 4 have provided a significant boost to this trend, allowing for more flexible allocation mechanisms and reducing compliance costs for A-share companies [1][2]. Group 2: Characteristics of A+H Companies - Enterprises with large asset scales, high capital expenditures, and mature international operations are leading the "A+H" model, utilizing the Hong Kong market for financing to support cross-border mergers and overseas expansions [2]. - Growth-oriented technology companies are also showing high interest in the "A+H" model, which offers broader capital allocation opportunities [2]. Group 3: Impact on Valuation and Liquidity - The "A+H" model is reshaping the valuation system and liquidity structure of Chinese listed companies, with significant foreign capital inflow observed in the Hong Kong market [2][3]. - For instance, by mid-2025, net inflows through the Hong Kong Stock Connect exceeded 730 billion HKD, surpassing 90% of last year's total [2]. Group 4: Future Outlook - The ongoing policy support and institutional optimization are expected to elevate the "A+H" model into a new phase of high-quality development, with more competitive Chinese companies likely to adopt this path for global capital and strategic positioning [3]. - The maturation of the "A+H" model reflects the deepening of China's capital market opening and the strategic choice of Chinese enterprises to enhance their international competitiveness [3].