Investment Rating - The report does not explicitly state an investment rating for the industry Core Insights - The U.S. "Genesis Mission" aims to establish a national-level technology initiative comparable to the "Manhattan Project," focusing on integrating scientific datasets, supercomputing resources, and AI models to enhance the U.S.'s global technology leadership [12][14] - The initiative emphasizes the application of AI in scientific discovery as a national security priority, indicating a shift from commercial AI applications to a more integrated national research approach [13][14] - The plan outlines six priority sectors: advanced manufacturing, biotechnology, critical materials, nuclear energy, quantum information science, and semiconductors, which will guide federal budget allocations and industrial policies [14][15] Summary by Sections Event Overview - The Genesis Mission was officially launched on November 24, 2025, by President Trump, with the goal of accelerating scientific breakthroughs in critical fields [12] - The initiative is led by the Department of Energy and aims to create a unified "American Science and Security Platform" [12][14] Strategic Shift - The focus has shifted from regulation to national research empowerment, establishing "AI for Science" as a strategic priority [13] - The government intends to leverage national resources to overcome scientific bottlenecks in key areas [13] Infrastructure Development - The plan includes building a national-level hardware and software infrastructure that integrates supercomputers, cloud-based AI environments, and extensive federal scientific data [14] - This infrastructure aims to create significant barriers to entry for competitors, positioning entities with high-quality data and computing capabilities at the core of future technology ecosystems [14] Priority Sectors - The six identified priority sectors are expected to drive demand for upstream computing infrastructure and benefit industry leaders that can integrate AI into their R&D processes [14][15] - Specific sectors include semiconductors, biotechnology, and clean technology, which are poised for growth due to the initiative [14] Public-Private Partnerships - The initiative emphasizes collaboration with private sector companies and universities, allowing technology firms to participate in national projects [15] - Clear execution milestones have been set, including resource audits and initial platform capabilities, which are expected to accelerate technology transfer from research to application [15]

Investment Rating - The report provides various investment ratings for companies in the consumer staples sector, with "Outperform" ratings for several companies including China Feihe, Haidilao, and China Resources Beer, while Budweiser APAC is rated as "Neutral" [1]. Core Insights - The report highlights significant price increases in vegetables and corrugated paper, with the spot cost index for vegetables rising by 7.08% month-on-month and 16.16% year-on-year, while corrugated paper prices increased by 8.81% month-on-month and 17.49% year-on-year [6][24][27]. - Most spot cost indices for monitored consumer goods have risen, while futures cost indices have generally declined, indicating a mixed outlook for the sector [31]. Summary by Category Beer - The spot cost index for beer decreased by 2.25% month-on-month, with a cumulative decline of 3.04% since the beginning of the year [12][32]. - The futures index also fell by 2.62% month-on-month, reflecting ongoing supply-demand imbalances [12][32]. Condiments - The spot cost index for condiments decreased by 0.95% month-on-month, with a cumulative decline of 3.50% since the start of the year [15][33]. - Soybean prices have shown an increase, with spot prices rising by 1.38% month-on-month [15][33]. Dairy Products - The spot cost index for dairy products increased by 0.74% month-on-month, while the futures index decreased by 1.07% [18][34]. - Fresh milk prices have declined to 3.03 yuan/kg, a year-on-year decrease of 3.2% [18][34]. Instant Noodles - The spot cost index for instant noodles increased by 0.64% month-on-month, while the futures index decreased by 1.47% [21][35]. - Palm oil prices have decreased significantly, impacting production costs [21][35]. Frozen Foods - The spot cost index for frozen foods increased by 0.37% month-on-month, while the futures index rose by 0.52% [24][36]. - Vegetable prices have surged due to adverse weather conditions, contributing to rising costs [24][36]. Soft Drinks - The spot cost index for soft drinks increased by 2.50% month-on-month, while the futures index decreased by 1.70% [27][37]. - The price of PET chips has declined, affecting overall production costs [27][37].

Investment Rating - The report maintains an "Outperform" rating for CSPC Pharmaceutical Group [2][12][23] Core Insights - In 9M25, CSPC achieved revenue of CNY 19.9 billion, a year-on-year decrease of 12%, with finished drug revenue at CNY 15.5 billion, down 17% year-on-year [3][16] - The gross profit margin (GPM) was reported at 65.6%, a decline of 4.9 percentage points year-on-year [3][16] - Management anticipates a return to positive growth in finished drug sales by 2026, despite uncertainties surrounding the renewal rules for generic drug procurement [3][16] Financial Performance Summary - Revenue projections for FY25 and FY26 have been adjusted to CNY 27.3 billion and CNY 30.1 billion, respectively, reflecting slower-than-expected out-licensing income recognition [9][23] - Net profit attributable to shareholders is forecasted at CNY 5.0 billion for FY25 and CNY 5.1 billion for FY26, down from previous estimates [9][23] - The company reported a net profit of CNY 3.5 billion in 9M25, a decrease of 7% year-on-year [3][16] Segment Performance - In 3Q25, all segments of finished drugs showed quarter-on-quarter improvement, with total finished drug revenue reaching CNY 4.7 billion, an increase of 8% quarter-on-quarter [5][18] - Notable revenue contributions in 3Q25 included CNY 1.91 billion from the nervous system segment and CNY 0.32 billion from the respiratory system, which saw a 73% year-on-year increase [21][18] Research and Development - R&D expenses for 9M25 were CNY 4.2 billion, an increase of 8% year-on-year, with an R&D expense ratio of 21.0% [3][16] - The company is advancing multiple clinical pipelines, including SYS6010, with clinical data expected to be released in 2026 [20][22] Out-Licensing Opportunities - The report highlights significant potential for out-licensing multiple assets, including SYS6010, which is progressing well in clinical trials [6][19] - The company's business development strategy is entering a phase of tangible results, with expectations for continuous deals that will enhance net profit [6][19]

wo[Table_Title] Research Report 25 Nov 2025 中国电子 China (Overseas) Technology 全球科技业绩快报：文远知行 25Q3 WeRide: 3Q25 Losses Narrow on Operating Leverage; L2++/L4 Strategy to Drive Path to Profitability 姚书桥 Barney Yao 吕小潼 Xiaotong Lyu barney.sq.yao@htisec.com xt.lyu@htisec.com [Table_yemei1] Flash Analysis [Table_summary] (Please see APPENDIX 1 for English summary) 事件 文远知行 25Q3 业绩表现：2025 年 11 月 24 日，文远知行-W 发布 2025 年第三季度业绩报告：第三季度，公司实现 总收入 1.71 亿元，较去年同期大幅增长 144.3%，创下历史单季最高增幅；毛利达 5630 万元，同比跃升 1123.9%， 毛利率为 32.9%，盈利能力显著 ...

Market Performance - Global markets experienced a widespread decline, with MSCI Global down by 2.1%, MSCI Developed Markets down by 2.0%, and MSCI Emerging Markets down by 3.0% [3][7][30] - In the developed markets, the UK FTSE 100 showed the strongest performance with a decline of 1.6%, while the South Korean Composite Index was the weakest, down by 3.9% [7][30] - Among emerging markets, India's Sensex 30 was the best performer, up by 0.8%, while the ChiNext Index in China fell by 6.2% [7][30] Trading Sentiment - The short-selling ratio in Hong Kong continued to rise, reaching 17.7%, indicating a historical low in investor sentiment [18][22] - North American manager positions decreased, with the NAAIM manager exposure index dropping to 86.6%, reflecting a high historical sentiment [18][22] Earnings Expectations - Hong Kong's earnings expectations for 2025 were revised upward, with the Hang Seng Index's EPS forecast increasing from 2077 to 2085, particularly in the materials sector [61] - In the US, the S&P 500's EPS forecast for 2025 remained stable at 272, with the technology sector seeing the most significant upward revision [61] - European earnings expectations remained unchanged, with the STOXX 50's EPS forecast for 2025 holding steady at 333 [61] Economic Outlook - Economic sentiment in China and the US showed signs of marginal improvement, with the Citigroup Economic Surprise Index for the US rising due to mixed non-farm payroll data and Fed rate cut expectations [3][61] - The European Economic Surprise Index significantly declined, influenced by geopolitical risks and political instability [3][61] Fund Flows - The market is increasingly focused on the Fed's interest rate cut expectations, with futures indicating a 0.63 rate cut anticipated by the end of the year [48][50] - Global liquidity trends showed significant inflows into the US, China, India, Japan, and South Korea, with Hong Kong experiencing a net inflow of 56 billion HKD [57][60]

Investment Rating - Investment advice is to outperform the market, with a focus on specific companies such as Huali Industrial Group, Stella International Holdings, Shenzhou International, and Best Pacific International [40][16]. Core Insights - October Swiss watch exports to China increased by 12.6% year-on-year, marking two consecutive months of double-digit growth. The overall Swiss watch exports showed a global decline of 4.4% [40][4]. - The report highlights a clearer recovery logic for the export manufacturing sector in 2026, driven by three main factors: clarity in US tariff policies, reduced tariff pressure with brands, and improved production efficiency [40][4]. - The North American luxury market is showing leading growth, supported by expectations of interest rate cuts, although Q4 performance needs to be monitored due to high base effects [40][4]. Industry Data Tracking - In October 2025, China's retail sales of clothing increased by 6.8%, while textile and apparel exports fell by 12.6% [17][19]. - Cumulative textile and apparel exports from January to October 2025 amounted to approximately $243.94 billion, reflecting a year-on-year decline of 1.79% [19][19]. - The report notes that the export of textiles and clothing in October 2025 was approximately $22.26 billion, down 12.64% year-on-year [19][19]. Recommended Stocks and Valuation - Recommended stocks include Huali Group, Stella International, Shenzhou International, and Best Pacific International, all rated as outperforming the market [16][40]. - The report provides earnings forecasts for these companies, indicating a positive outlook for their performance in the coming years [16][40].

Market Performance - The US hotel sector increased by 2.8%, with Marriott and Hilton rising by 3.8% and 1.83% respectively, demonstrating resilience under pressure[6] - The overseas sportswear sector decreased by 0.2%, with Amer Sports surging by 12.2% due to strong Q3 performance, leading to a revenue increase of 30%[14] - The jewelry sector fell by 2.1%, influenced by AI bubble concerns and reduced expectations for a December rate cut, strengthening the dollar[14] Sector Analysis - The domestic sportswear sector dropped by 2.4%, with major OEMs like Shenzhou International and Crystal International declining by 6.7% and 2.6% respectively due to geopolitical tensions[14] - The retail sector saw a decline of 4.0%, with China Duty Free falling by 10.5% as investors took profits amid uncertain policy outlooks[14] - The pet sector decreased by 5.7%, with concerns over sustainability as sales expenses outpaced revenue growth[14] Valuation Insights - The expected PE for the overseas sportswear sector in 2025 is 29.0x, which is 54% of the past 5-year average[15] - The expected PE for the domestic cosmetics sector is 27.6x, representing 52% of the past 5-year average[15] - Most sectors are valued below their historical 5-year averages, indicating potential investment opportunities[15]

Investment Rating - The report assigns an "Outperform" rating to multiple companies in the essential consumer goods sector, including Guizhou Moutai, Wuliangye, and others [1]. Core Insights - The wholesale prices of Baijiu have mostly declined, while prices for instant foods and condiments have rebounded [1][10]. - Discounts for convenience foods and seasonings have narrowed compared to the end of October, indicating a potential recovery in consumer spending [19][38]. - The report highlights the stability of discounts for infant formula and beer, while discounts for liquid milk and soft drinks have increased [21][38]. Summary by Sections Baijiu Pricing - The wholesale prices for various Baijiu brands, such as Moutai and Wuliangye, have shown significant declines compared to previous months and year-to-date figures [9][40]. - For instance, the price of Feitian Moutai (case) is 1650 yuan, down by 110 yuan from last month, and down 590 yuan year-to-date [40]. Consumer Goods Discounts - Convenience foods have seen an increase in average and median discount rates, moving from 93.2%/95.9% at the end of October to 95.8%/97.0% [19][38]. - Seasonings also experienced a rise in discount rates, from 83.7%/84.9% to 85.9%/88.9% [19][38]. - In contrast, liquid milk discounts have widened, with average rates dropping from 69.6% to 66.0% [21][38]. Company Ratings - The report lists several companies with an "Outperform" rating, including: - Guizhou Moutai - Wuliangye - Luzhou Laojiao - Shanxi Fenjiu - Yanghe - Others [1].

Investment Rating - The report recommends a positive investment outlook on the AI-enabled manufacturing sector, particularly focusing on industrial software and automation companies that facilitate the digital transformation of lighthouse factories [3]. Core Insights - The report emphasizes that lighthouse factories are evolving into key carriers of new productivity and industrialization, driven by AI and the "14th Five-Year Plan" [1]. - It highlights the significant role of domestic industrial software and automation vendors in this ecosystem, which are becoming the core driving force behind the development of lighthouse factories [1]. Summary by Sections 1. From Technical Benchmark to Ecological Leadership - Lighthouse factories are recognized as the most advanced factories globally, representing the highest level of smart manufacturing [7]. - The focus of lighthouse factories has shifted from single-point applications of Industry 4.0 to comprehensive operational upgrades, emphasizing customer-centricity, production efficiency, supply chain resilience, sustainability, and talent development [10][12]. - The application of AI technologies is increasingly significant, with generative AI and predictive maintenance technologies notably reducing defect rates, energy consumption, and production cycles [16]. 2. Policy and AI Dual Empowerment - National policies are driving the rapid development of lighthouse factories, with a focus on digitalization, networking, intelligence, and green development [35]. - As of September 2025, China has 85 lighthouse factories, accounting for 42.29% of the global total, showcasing its leadership in this sector [20][22]. - The distribution of lighthouse factories in China shows a trend of coastal concentration with inland regions catching up, supported by local government initiatives [39][42]. 3. Domestic Industrial Software and Automation Vendors as Key Drivers - Hikvision is highlighted for its "Hikvision Guanlan" model, which empowers smart IoT scenarios and supports the transformation of leading factories into lighthouse factories [54]. - The report discusses the significant advancements made by various companies, including Dahua Technology, Zhongkong Technology, and others, in enhancing supply chain collaboration and digital transformation [54][56].

Investment Rating - The report rates the company as "Outperform" with a target price of 47.74 USD based on a 25x PE for 2025 [4][12]. Core Insights - The company focuses on growth and market share, with a significant increase in store numbers and same-store sales driven by takeaway demand [14]. - Financial performance shows strong revenue growth, with a projected increase in net profit for 2025-2027 [4][12]. Financial Summary - Total revenue is forecasted to grow from 24,903 million RMB in 2023 to 66,341 million RMB in 2027, reflecting an 87.34% increase in 2023 and a 10.92% increase in 2027 [3]. - Net profit is expected to rise from 2,848 million RMB in 2023 to 5,320 million RMB in 2027, with a notable growth of 483.30% in 2023 [3]. - The company’s operating profit margin (OPM) for Q3 2025 is reported at 17.5%, down 6.0 percentage points year-on-year [15]. Store Expansion and Market Dynamics - As of Q3 2025, the company operates 29,214 stores, a 36.88% increase year-on-year, with a net addition of 3,008 stores in Q3 [14]. - The average monthly active users reached 112.30 million, up 40.6% year-on-year, indicating strong customer engagement [14]. Cost Structure and Profitability - The company is optimizing its cost structure through refined operations, despite facing pressure from high international coffee bean prices [15]. - The takeaway fee rate increased to 18.90%, up 9.79% year-on-year, impacting profit margins [15].