Investment Rating - Target price is RMB 29.84, maintaining 'Outperform' rating [12] Core Views - The company is implementing the "300×300" strategy for its digital wind tunnel products, with a focus on AI applications and educational training solutions [12] - Revenue for 2024 is projected at RMB 356 million, down 9.99% YoY, with a net profit attributable to shareholders of RMB 8 million, down 72.73% YoY [12] - The company launched the Yuanfang-AI teaching and training platform to support AI talent development [12] Financial Summary - 2023A revenue was RMB 396 million, with a net profit of RMB 31 million [3] - 2024A revenue is expected to be RMB 356 million, with a net profit of RMB 8 million [3] - EPS for 2025-2027 is forecasted at RMB 0.43, 0.61, and 0.80 respectively [12] Product and Market Insights - Digital wind tunnel testing revenue for 2024 is expected to be RMB 175 million, up 50.50% YoY, while network range and operations revenue is projected at RMB 157 million, down 33.84% YoY [12] - The company has signed over 150 clients for its digital wind tunnel products, with an average order value exceeding RMB 1 million [12] - The network range business has seen a decline due to reduced client budgets and project delays [12]

Consumption - Marginal improvement in consumer goods, with automotive wholesale and retail sales showing seasonal recovery[6] - High-end dining and liquor, particularly Moutai, continue to decline due to policy impacts, with Moutai prices down 6.8% week-on-week[6] - Textile and apparel demand is recovering, with a second consecutive week of improvement[6] Investment - Special bond issuance accelerated, totaling CNY 2.16 trillion as of June 28, reflecting a faster pace compared to previous years[17] - New home sales in 30 cities showed seasonal recovery but were down 15.8% year-on-year, indicating a slower recovery in second and third-tier cities[17] - Construction progress in infrastructure and real estate is marginally improving, with asphalt operating rates rising[17] Trade and Export - External demand remains weak, with South Korea's exports and imports from China growing by 3.4% and 8.3% year-on-year, respectively[22] - Port data indicates a recovery in the number of ships but a slight decline in cargo tonnage, suggesting a mismatch between supply and demand[22] - The Baltic Dry Index (BDI) fell by 12.4%, indicating weakened freight rates despite restored shipping capacity[22] Production - Power generation shows seasonal coal consumption recovery, but steel and petrochemical industries are under pressure[31] - The operating rates for steel and petrochemical products continue to decline, indicating ongoing industry stress[32] Inventory - Coal inventories at ports have dropped for six consecutive weeks, reaching a yearly low, while cement inventory ratios are recovering[41] - Downstream industries are primarily focused on restocking, reflecting subdued demand[41] Prices - Consumer Price Index (CPI) and Producer Price Index (PPI) are both declining, with oil prices dropping below $70 per barrel, down 10.6% week-on-week[46] - Industrial prices are also falling, with the South China price index down 1.1%[46] Liquidity - The US dollar index fell below 98, marking its lowest level since February 2022, while the People's Bank of China injected CNY 10,672 billion to support liquidity[55] - The 10-year government bond yield rose by 0.7 basis points to 1.65%[55]

Profit Trends - In May, the profit growth rate of industrial enterprises fell to -9.1%, a decrease of 12.1 percentage points from April[3] - Cumulative profit growth from January to May was -1.1%, down from 3.2% in the previous four months[4] - The profit margin for May was 5.3%, slightly down from April, indicating a significant year-on-year decline due to high profit margins last year[5] Industry Performance - The share of profits from midstream industries dropped from 54% to 49%, reflecting weaker demand compared to upstream and downstream sectors[6] - Upstream industries faced profit declines primarily due to falling prices and volumes, while midstream sectors, particularly export-oriented ones, struggled to pass costs downstream[10] - Specific sectors like specialized equipment and electrical machinery saw profit growth rates drop by over 20 percentage points due to changing export dynamics[10] Economic Outlook - Active inventory reduction has continued for two months, with finished goods inventory growth at 3.5%[16] - Future profit recovery for enterprises will depend on the effectiveness of domestic demand policies amid ongoing external uncertainties[16] - The report anticipates that proactive policies will support domestic demand improvement, aiding in profit recovery for businesses[3]

Investment Rating - The report assigns an "Outperform" rating to multiple companies in the discretionary sector, including Nike, Midea Group, JD Group, Gree Electric, Anta Sports, Haier Smart Home, and many others [1]. Core Insights - The report highlights a positive resonance between old and new consumption sectors, indicating an upward trend in the discretionary market [4][14]. - The gaming sector showed the best performance, with average daily gross gaming revenue (GGR) recovering to 686 million MOP, reaching 89% of pre-pandemic levels [5][14]. - Nike's stock surged by 18.5% due to better-than-expected Q4 FY25 results and positive future outlooks, particularly in the running segment [5][14]. - The report notes that many sectors are still undervalued compared to their historical averages, suggesting potential investment opportunities [9][17]. Weekly Performance Review - The report details the weekly performance of various sectors, with gaming, overseas sportswear, and U.S. hotels leading the gains, while luxury goods and daily necessities showed negative growth [4][11]. - Year-to-date performance highlights that gold and jewelry, domestic cosmetics, and pet sectors have outperformed the MSCI China index [11][12]. Sector Valuation Analysis - The report provides a valuation analysis indicating that most sectors are trading below their five-year average P/E ratios, with the overseas sportswear sector expected P/E at 34.4x, which is 55% of its historical average [9][17]. - The domestic sportswear sector's expected P/E is 12.6x, representing 73% of its five-year average, while the luxury goods sector is at 21.7x, 44% of its historical average [17].

Investment Rating - The report assigns an "Outperform" rating to multiple companies including Pop Mart, Anta Sports, Haidilao, and China Feihe, while Budweiser APAC is rated "Neutral" [1]. Core Insights - The report highlights significant developments in the F&B, designer toys, and home appliance sectors, including new product launches and strategic moves by key players [2][6]. - Pop Mart is reportedly exploring entry into the home appliance sector, indicating potential diversification and growth opportunities [2][6]. - The report notes a strong performance in the restaurant sector, with companies like Xiaocaiyuan and Green Tea Group showing substantial weekly gains [3][7]. Summary by Category F&B Sector - Key performers include Xiaocaiyuan (+17.2%), Green Tea Group (+14.0%), and DPC Dash (+10.8%), while Chagee saw a decline of -7.8% [3][7]. - Guming launched a promotional campaign for freshly brewed coffee at 8.9 RMB, and Yum China introduced its first AI agent for restaurant operations [2][6]. Designer Toys Sector - Pop Mart and Miniso performed well with gains of +7.6% and +3.5% respectively, while Bloks experienced a decline of -3.9% [3][7]. - Pop Mart's inclusion in Time Magazine's list of the world's 100 most influential companies in 2025 marks a significant recognition for the brand [2][6]. Home Appliance Sector - Roborock led the home appliance sector with a +5.4% increase, while Hisense HA faced a decline of -5.6% [3][7]. - Haier announced the formation of an industrial robotics division, indicating a strategic shift towards automation and innovation in the sector [2][6].

Investment Rating - The report assigns an "Outperform" rating to several companies in the high-performance outdoor apparel sector, including Anta Sports, Shenzhou International, Li Ning, Samsonite, Xtep International, and 361 Degrees, with target prices set for each [1]. Core Insights - The high-performance outdoor apparel industry in China is entering a trillion-yuan era, with significant growth potential. The market size increased from 53.9 billion yuan in 2019 to 102.7 billion yuan in 2024, reflecting a compound annual growth rate (CAGR) of 13.8%. It is projected to reach 215.8 billion yuan by 2029, with a CAGR of 16% from 2024 to 2029 [3]. - The report highlights Pelliot as a leading brand in high-performance outdoor apparel, which has established a broad product matrix and a direct-to-consumer (DTC) sales channel. The company reported a revenue of 1.766 billion yuan in 2024, a 94.5% year-on-year increase [2][17]. - Pelliot's product matrix includes four main series: Peak Series, Professional Performance Series, Mountain Series, and Classic Series, with the Classic Series contributing over 80% of sales revenue [34]. Summary by Sections Company Overview - Pelliot has been a key player in the high-performance outdoor apparel market since its establishment in 2012, focusing on a wide range of products suitable for outdoor activities, fitness, and urban commuting [2][10]. - The company has developed a multi-channel sales and distribution network, with online sales accounting for 76.5% of total revenue in 2024, while offline sales grew by 257.1% [2][19]. Financial Performance - Pelliot's revenue grew from 379 million yuan in 2022 to 1.766 billion yuan in 2024, with a remarkable growth rate of 139.9% in 2023 and 94.5% in 2024 [17][18]. - The company's gross margin improved from 54.3% in 2022 to 59.6% in 2024, driven by business scale expansion, enhanced pricing power, and effective cost control [7]. Market Position - The high-performance outdoor apparel market in China is relatively fragmented, with the top ten brands holding a combined market share of 27.3% in 2024. Pelliot's market share was 1.7% [3]. - Pelliot ranked third in online retail sales among high-performance outdoor apparel brands in mainland China, with a market share of 3.7% [3]. Product Development - The company employs a dual-track technology system of "internal innovation + external procurement," focusing on proprietary technologies such as Storm Breath and Storm Shield [6]. - Pelliot's core products demonstrate its technological capabilities and market positioning, contributing significantly to revenue and brand strength [39].

Investment Focus - The report indicates that despite a cautious medium-term outlook, there is potential for a short-term market rebound following recent declines, especially if geopolitical tensions ease [1][10] - The Hang Seng Index experienced a strong rebound, rising 3.2%, with technology stocks showing significant recovery potential after sufficient corrections [1][10] - The report highlights that sectors such as materials, technology, and finance led the gains in the Hong Kong market, while A-shares saw strong performance in technology, materials, and industrials [1][10] Liquidity Analysis - Signs of liquidity disturbances have emerged, with the Hong Kong Monetary Authority (HKMA) responding quickly to strong-side convertibility triggers by injecting significant amounts of HKD into the market [2][11] - The HKMA's actions in May 2023 included selling nearly HKD 130 billion, which led to a drop in HIBOR to very low levels, impacting the HKD-USD interest rate spread [2][11] - The report notes that as liquidity remains loose, speculative trading has increased, with several low-priced stocks doubling in value within a single day [3][12] Southbound Fund Flows - Southbound fund inflows increased to HKD 28.4 billion amid easing Middle Eastern tensions, although this remains significantly lower than inflows seen earlier in the year [3][13] - Notable purchases included Guotai Junan International, while Alibaba and Tencent experienced moderate outflows, indicating shifting investor sentiment [3][13] - The report identifies that southbound funds primarily flowed into financials, pharmaceuticals, and semiconductors, while reducing exposure to communication services and energy [3][13] A-Share Market Dynamics - The brokerage sector's rally led to an increase in margin financing and securities lending balances, indicating renewed investor interest [4][14] - However, macroeconomic uncertainties may limit incremental capital inflows, potentially leading to funding supply pressures if margin financing continues to rise [4][14] - The banking sector experienced a sharp decline after sustained gains, reflecting signs of marginal liquidity weakening in the market [4][14] Market Outlook - The report concludes that while a short-term rebound is likely, the broader oscillation pattern in the market has not ended, with risks in high-flying sectors still not fully released [4][15] - Positive developments in U.S.-China relations and strong earnings expectations in overseas AI infrastructure stocks may support market sentiment in the short term [4][15] - Investors are advised to gradually reduce exposure during the rebound, particularly in sectors that have seen significant recent gains, to prepare for potential volatility [4][15]

[Table_Title] 研究报告 Research Report 27 Jun 2025 Research Report on the Entire 618 Cycle of the Beauty Category on both Taobao/Tmall and Douyin Platforms 中国化妆品 China (A-share) Cosmetics 美妆品类 618 全周期淘系和抖音双平台调研报告 寇媛媛 Yuanyuan Kou 吴颖婕 Mindy Wu yy.kou@htisec.com mindy.yj.wu@htisec.com [Table_yemei1] 热点速评 Flash Analysis [Table_summary] (Please see APPENDIX 1 for English summary) 本次 618 期间，淘系为美妆销售主战场但销售略低于预期，抖音美妆增速高于抖音大盘增速。淘系平台 5.13-6.20 的 GMV 略超 400 亿，同比增长超 10%，不及平台预期目标。总体淘系平台大盘增速同样不及预期，主要由于政策 调整导致爆发力减弱，去年跨店满减活动单日 ...

Investment Rating - The report suggests a focus on upstream suppliers that provide core technologies and high barriers to entry, rather than direct investment in launch vehicle companies that face significant market and capital expenditure risks [4][50]. Core Insights - The global aerospace launch market is undergoing a profound and irreversible structural expansion driven by a revolution in cost structures, shifting from a government budget-dominated paradigm to a commercially driven era focused on high launch frequency and cost efficiency [1][7]. - The key catalyst for this transformation is SpaceX's disruptive cost reductions achieved through reusable rocket technology, which has set new price benchmarks and operational expectations for the market [1][7]. - Future launch demand will be supported by three solid pillars: the large-scale deployment of commercial broadband constellations (e.g., Starlink and Kuiper), increasing geopolitical competition and national security needs, and the revival of scientific and deep space exploration missions represented by the Artemis program [1][10]. Industry Background and Market Drivers - The report highlights a significant increase in global orbital launches, with a record of 259 launches expected in 2024, up from 223 in 2023, and a forecast of over 300 launches in 2025 [7][10]. - The transition to a commercial-driven market is exemplified by SpaceX's 138 launches in 2024, which accounted for half of the global market, establishing a new operational rhythm [7][10]. Core Technology Path Analysis - The competition in the launch market is fundamentally a competition of underlying propulsion technologies, converging on the "Methalox + Reusability + Additive Manufacturing" combination [2][13]. - Methalox engines are recognized as the future mainstream path due to their clean combustion characteristics and ability to simplify the reuse process, addressing the carbon buildup issues of traditional kerosene fuels [15][19]. Value Chain and Supply Chain Analysis - The report identifies a shift in value and profit concentration towards upstream suppliers of core technologies and high-barrier components, moving away from midstream assembly integration [3][36]. - The "smile curve" analysis indicates that high-value areas are concentrated at the upstream and downstream ends of the value chain, while midstream assembly faces profit margin pressures [36][37]. Investment Recommendations - The report recommends focusing on companies such as Howmet Aerospace, LOAR, VSE Corporation, BAE Systems, Rolls-Royce, Safran, L3Harris Technologies, and Velo3D, which are positioned as key technology enablers in the supply chain [4][50].

Investment Rating - The report assigns an "Outperform" rating for the industry, suggesting a positive outlook for investment opportunities [2]. Core Insights - The launch of Xiaomi YU7 is expected to structurally change the prosperity of the automotive parts industry, alleviating previous market concerns regarding the domestic passenger car market in late 2025 to 2026 [4][10]. - The YU7 has received a strong initial response, with over 289,000 orders within the first hour of its launch, indicating significant market demand [9]. - The report highlights potential investment opportunities in the supply chain of YU7, specifically mentioning companies such as Wuxi Zhenhua, Desay SV, Huayang Group, and Nexteer Automotive, which are expected to benefit from increased revenue as YU7 production ramps up [10]. Summary by Sections Investment Advice - Following the launch of Xiaomi YU7, there is a surge in orders, indicating a new opportunity in the supply chain. The report suggests focusing on the supply chain companies associated with YU7 [7][10]. Product Details - Xiaomi YU7 is priced starting at RMB 253,500, featuring advanced specifications such as the Xiaomi Super Motor V6s Plus, a 0-100 km/h acceleration time of 3.23 seconds, and a maximum range of 835 km [8][9]. - The YU7 is available in three configurations: YU7 at RMB 253,500, YU7 Pro at RMB 279,900, and YU7 Max at RMB 329,900, which are considered competitive in the market [8]. Market Potential - The report estimates that YU7's annual sales could reach between 300,000 to 400,000 units, with the potential to drive additional market growth in the RMB 200,000 to 300,000 electric vehicle segment, which is substantial [9][10]. - The total SUV market in the RMB 200,000 to 300,000 price range is estimated to exceed 1 million units, indicating a significant opportunity for YU7 to capture market share [9].