Group 1 - The company is making progress in its collaboration with Hangzhou Huigan Intelligent Technology Co., Ltd. on the development of robotic electronic skin [2] - As of July 28, 2025, the company's subsidiary, Singapore Xingyuan, has acquired over 5% of Ferrotec Corporation's shares [2] - The company will fulfill its information disclosure obligations regarding subsequent developments as required [2]

Core Insights - QuantumScape has achieved a significant milestone by integrating the Cobra separator manufacturing process into its benchmark battery product, leading to a stock price increase of over 30% [1] - The Cobra process represents a major breakthrough in ceramic separator manufacturing, improving heat treatment speed by approximately 25 times compared to the previous Raptor process, while significantly reducing the space occupied by each film [1] - The advancements in the Cobra technology are expected to help QuantumScape reduce the overall production footprint and time for solid-state batteries, laying the groundwork for commercialization [1] Company Developments - Star源材质 has been developing similar products, with progress reported in solid electrolyte membranes, including oxide composite and polymer composite types that enhance battery cycle life and safety [1] - The company has developed various rigid skeleton membranes, including high-strength heat-resistant composite membranes and high porosity skeleton membranes, aimed at producing flexible solid-state batteries with high energy density and intrinsic safety [2] - Star源材质 has established strategic partnerships for the development of solid electrolyte membranes and high-performance solid-state batteries, including collaborations with 中科深蓝汇泽 and 瑞固新材 [2]

Core Viewpoint - The report highlights the opportunities for profit recovery in core materials for lithium batteries under the influence of anti-involution policies, as the industry faces significant losses due to accelerated capacity expansion and increased competition [1][4]. Industry Developments - A closed-door meeting was held on August 8 in Shenzhen with key representatives from eight major dry-process lithium battery separator manufacturers to address "involution" competition and promote healthy industry development [2][3]. - The participating companies reached five key agreements: price self-discipline, scientific capacity release, suspension of capacity expansion, strengthening industry chain cooperation, and social supervision to ensure compliance with standards [3]. Investment Recommendations - The report suggests focusing on companies with cost and technological advantages that are likely to benefit from the expected increase in market concentration, including Wanrun New Energy, Hunan Youneng, CATL, Yiwei Lithium Energy, Zhongchuang Innovation, Tianci Materials, New Zobon, Putailai, Keda Li, Enjie, and Xingyuan Materials [2][4].

Group 1: Market Overview - Global trade optimism boosts investor confidence, with US July CPI data reinforcing expectations for a Fed rate cut in September. Risk assets see significant inflows, with the Nasdaq and S&P 500 both rising over 1% to reach all-time highs. The S&P 500 closes up 1.13%, the Dow up 1.10%, and the Nasdaq up 1.39% [1] - The Russell 2000 index surges by 3%, indicating strong performance in small-cap stocks [1] - The Nasdaq Golden Dragon China Index rises by 1.49%, with notable gains from companies like Zhengye Bio (+40%), Tencent Music (+12%), and Jiayin Technology (+9.35%). However, companies like Xiaoma Zhixing and NIO see declines of 3.49% and 8.96%, respectively [1] Group 2: Economic Indicators - US Treasury yields drop significantly following inflation data, although they recover slightly later. The 2-year yield ends down nearly 3 basis points [2] - The US dollar declines by 0.47%, while gold fluctuates around $3,350 [3] - Crude oil prices fall, with WTI oil dropping nearly 2% from its daily high [4] Group 3: Corporate Developments - AI company Perplexity proposes a $34.5 billion acquisition of Google's Chrome, indicating a competitive shift in the AI search market [5][13] - In the lithium battery sector, a closed-door meeting among key dry-process lithium battery separator manufacturers in Shenzhen results in agreements on price discipline, capacity management, and industry cooperation [14] - The insurance sector sees a strong performance in Hong Kong, with companies like China Pacific Insurance and China Taiping rising by 6.77% and 5.89%, respectively. Analysts suggest that the Chinese insurance industry has significant growth potential compared to international standards [15] Group 4: Financial Announcements - Notable financial results include Kweichow Moutai reporting a net profit of 45.403 billion yuan for the first half of the year, a year-on-year increase of 8.89%. China Unicom's net profit for the same period is 6.349 billion yuan, up 5.1% [23]

Group 1 - The meeting held in Shenzhen aimed to address the "involution" competition in the lithium battery separator industry and promote healthy development [1] - Eight major companies, including Xingyuan Material and Enjie, discussed their production and sales plans for 2024 and the first half of 2025, as well as product cost structures [1] - The companies reached several key agreements: price self-discipline, scientific capacity release, suspension of capacity expansion, strengthening supply chain cooperation, and encouraging social supervision [1] Group 2 - The lithium battery separator is a critical component that separates the positive and negative electrodes, ensuring lithium ions pass through while preventing electron transmission [1] - According to the "China Lithium-Ion Battery Separator Industry Development White Paper (2025)," the output of lithium battery separators in China is expected to reach 22.75 billion square meters in 2024, accounting for 79.4% of the global market [1] - In the first half of 2024, China's separator production reached 9.24 billion square meters, a year-on-year increase of 20%, but prices have been declining due to a mismatch between supply and demand [1][2]

Group 1 - The meeting of lithium battery dry separator manufacturers in Shenzhen resulted in five key agreements aimed at stabilizing the industry, including price discipline and capacity management [1] - Companies agreed to pause expansion plans for the next two years to focus on optimizing existing capacity due to significant supply-demand imbalance [1] - The meeting is seen as a response to national policies promoting sustainable development and aims to foster a healthy ecosystem within the industry [1] Group 2 - The lithium battery materials industry is facing significant challenges, with major revenue declines reported across key materials: over 40% drop in cathode materials, 20% in electrolytes, 4.5% in anodes, and 11.7% in separators [2] - Approximately half of the 38 listed lithium battery material companies are experiencing losses, with cathode and electrolyte companies reporting negative overall profits [2] - The industry is urged to adhere to quality improvement and avoid price dumping to restore healthy competition and profitability, which is essential for future innovation and development [2]

Core Viewpoint - The meeting of key dry lithium battery separator manufacturers in Shenzhen aimed to address the "involution" competition and promote healthy industry development [1][2][3] Industry Overview - The lithium battery separator, a critical component in lithium batteries, has a thickness of only one-tenth of a human hair and accounts for approximately 10% of the battery's cost [2] - The separator industry has experienced rapid growth due to the surge in demand from electric vehicles and energy storage sectors, but irrational capacity expansion has led to oversupply [2][6] - In 2024, the dry separator industry faced severe price wars, with some models dropping below cost, resulting in widespread losses among manufacturers [2][3] Consensus Reached - Eight companies reached several important agreements during the meeting: 1. Price self-discipline to maintain prices above cost for survival 2. Scientific capacity release based on market supply and demand dynamics 3. Suspension of capacity expansion to focus on optimizing existing production 4. Strengthening industry chain cooperation for mutual benefits 5. Acceptance of social supervision to ensure compliance with standards [4][3] Market Data - In 2024, China's lithium battery separator market is expected to reach a shipment volume of 21.73 billion square meters, a year-on-year increase of 31% [5] - The wet separator shipment volume is projected to exceed 16.88 billion square meters, while dry separator shipments are expected to surpass 4.85 billion square meters [5] - "Chinese separators" are anticipated to account for 91% of the global market share [5] Industry Challenges - The lithium battery separator industry faces intense competition and declining prices due to increased supply and downstream cost control efforts [6] - The China Plastics Processing Industry Association has previously issued initiatives to promote high-quality development and avoid excessive competition [6] Technological Advancements - Companies are shifting focus towards technological innovation and solid-state battery materials to enhance profitability [6][7] - Star Source Materials has established a joint venture for solid-state electrolyte and rigid skeleton membrane development, successfully passing rigorous testing [6] - Enjie Co., another leading separator manufacturer, is also advancing its solid-state battery material development, focusing on lithium sulfide and solid electrolyte membranes [7]

Investment Rating - The industry investment rating is "Overweight," indicating that the industry index is expected to outperform the market index by more than 10% over the next six months [6]. Core Insights - In July 2025, the production and sales of new energy vehicles (NEVs) continued to show rapid year-on-year growth, with production and sales reaching 1.243 million and 1.262 million units, respectively, representing year-on-year increases of 26.3% and 27.4% [4]. - The penetration rate of NEVs reached 48.7% in July, up 2.9 percentage points from the previous month, while the cumulative penetration rate for January to July was 45% [4]. - The total battery production in July was 133.8 GWh, with a year-on-year growth of 44.3%, while battery sales were 127.2 GWh, showing a year-on-year increase of 47.8% [4]. - The demand for power batteries is expected to recover as the traditional peak season for NEVs approaches, driven by the continuous development of renewable energy and the increasing demand for energy storage [4]. Summary by Sections New Energy Vehicle Market - In July 2025, NEV sales reached 1.262 million units, a year-on-year increase of 27.4%, while the cumulative sales from January to July were 8.232 million units, up 39.2% year-on-year [4]. - Pure electric vehicle sales in July were 811,000 units, up 47.1% year-on-year, while plug-in hybrid sales were 451,000 units, up 2.8% year-on-year [4]. Battery Production and Sales - In July, the total battery production was 133.8 GWh, with a month-on-month increase of 3.6% and a year-on-year increase of 44.3% [4]. - Power battery sales accounted for 91.1 GWh, representing 71.6% of total sales, with a year-on-year growth of 45.8% [4]. Export and Market Dynamics - In July, the total battery exports were 23.2 GWh, a year-on-year increase of 35.4%, with power battery exports at 14.8 GWh, up 48.4% year-on-year [4]. - The report highlights the potential for price increases in lithium carbonate due to supply expectations and the ongoing development of solid-state battery technology [4]. Investment Recommendations - The report suggests focusing on leading companies in the battery and materials sectors that have technological and production advantages, particularly in solid-state electrolytes and new electrode materials [4]. - Key companies to watch include CATL, Yiwei Lithium Energy, and others that are actively involved in the solid-state battery supply chain [4].

Investment Rating - The report maintains a "Buy" rating for the photovoltaic and wind power sectors, indicating a positive outlook for these industries in the near to medium term [4][5]. Core Insights - The photovoltaic industry is undergoing a "de-involution" movement at the national strategic level, focusing on capacity integration in the silicon material segment and strengthening price regulation across the supply chain. The industry is currently at the bottom of the cycle, with future policy strength being a key variable influencing its trajectory. In the medium to long term, the photovoltaic sector is expected to enter a phase of high-quality development, with technological upgrades and market structure optimization becoming core competitive factors [4]. - The wind power sector in China has a strong global competitive advantage, with a relatively reasonable supply-demand structure and robust profitability among companies. The year 2025 is anticipated to be a significant year for offshore wind power development in China, with accelerated construction and favorable export trends [4]. Weekly Market Review - From August 4 to August 8, 2025, the Shanghai Composite Index rose by 2.11%, while the Shenzhen Component Index and the ChiNext Index increased by 1.25% and 0.49%, respectively. The Shenwan Electric Power Equipment Index rose by 1.94%, outperforming the CSI 300 by 0.71 percentage points. Within sub-sectors, photovoltaic equipment, wind power equipment, batteries, and grid equipment experienced changes of +1.29%, +4.50%, +0.99%, and +3.08%, respectively [12][18]. Key Sector Tracking - **Photovoltaic Sector**: The report highlights a significant project where JA Solar is the candidate for a 50MW photovoltaic component procurement project in Tibet, with a bid amount of approximately 36 million CNY and a unit price of 0.7215 CNY/W [3][21]. - **Wind Power Sector**: The report emphasizes the strong profitability of domestic wind power companies in the first half of the year and suggests focusing on leading companies such as Goldwind Technology and Dongfang Cable [4]. Investment Recommendations - **Photovoltaic**: Focus on segments that have undergone sufficient corrections, such as silicon materials, glass, and battery cells. Recommended companies include Aiko Solar, Flat Glass Group, GCL-Poly Energy, and Junda Technology [4]. - **Wind Power**: Maintain a positive outlook on the domestic wind power supply chain, with recommendations for companies like Goldwind Technology and Zhongtian Technology [4]. - **New Energy Vehicles**: The sector continues to grow rapidly, with recommendations to focus on battery and structural components benefiting from low upstream raw material prices, including companies like CATL and EVE Energy [5]. Industry Price Data - The report includes price trends for key materials in the photovoltaic supply chain, indicating fluctuations in silicon material, battery cell, and module prices, which are critical for assessing market dynamics [35][36][38].

Investment Rating - The investment rating for the industry is "Outperform the Market" (maintained) [2][13] Core Viewpoints - The "anti-involution" policy is expected to lead to a turning point in profitability for the lithium battery industry. The recent acceleration in capacity expansion and increased competition have resulted in significant losses for many companies in the energy storage battery and lithium battery materials sectors. However, with the ongoing push for "anti-involution" and the revision of pricing laws, market concentration is likely to increase, and leading companies with cost and technological advantages are expected to show improved profitability [3][7]. Summary by Relevant Sections Policy Developments - On July 24, the National Development and Reform Commission and the State Administration for Market Regulation released a draft for public consultation regarding the revision of the Price Law, which aims to clarify standards for identifying unfair pricing behaviors and regulate market pricing order to combat "involution" competition [2][4]. - A meeting held on July 28 emphasized the need to address eight key areas, including the elimination of overdue payments to enterprises and the consolidation of the "anti-involution" efforts in the new energy vehicle sector [5][6]. Investment Recommendations - The report suggests that leading companies in the lithium battery sector are likely to see stable improvements in profitability due to the "anti-involution" backdrop. Companies to watch include Wanrun New Energy, Hunan Youneng, CATL, Yiwei Lithium Energy, Zhongxin Innovation, Tianci Materials, New Zobon, Putailai, Keda Li, Enjie, and Xingyuan Materials [3][7]. Financial Projections - The report provides financial forecasts for several companies, indicating expected net profits in billions of RMB for 2024A to 2026E, with notable companies like CATL projected to achieve a net profit of 507.4 billion RMB in 2024A [9].