Investment Rating - The report assigns a "Buy" rating to the company with a target price of 74.12 CNY [5][24]. Core Insights - The company is a significant supplier of solid propulsion and ammunition systems in China, benefiting from increased defense budgets and ammunition replenishment, leading to strong growth in military product sales [2][11]. - The company has established a dual product system focusing on missile solid propulsion and ammunition equipment, with a strong emphasis on military applications while extending technology into civilian sectors [11][26]. - The report anticipates steady revenue growth, with projected revenues of 1.04 billion CNY in 2023, increasing to 1.88 billion CNY by 2027, reflecting a compound annual growth rate (CAGR) of approximately 15.9% [4][16]. Financial Summary - Total revenue is expected to grow from 1,040 million CNY in 2023 to 1,883 million CNY in 2027, with year-on-year growth rates of 24.3%, 15.8%, 15.8%, 16.5%, and 15.9% respectively [4][16]. - Net profit attributable to the parent company is projected to rise from 141 million CNY in 2023 to 330 million CNY in 2027, with growth rates of 27.3%, 41.3%, 14.2%, 21.3%, and 19.8% [4][16]. - The earnings per share (EPS) is expected to increase from 0.67 CNY in 2023 to 1.58 CNY in 2027 [4][15]. Business Segmentation - Military products are the primary revenue source, expected to contribute over 90% of total revenue from 2023 to 2027, with military revenue projected to grow at rates of 16% to 17% during this period [15][40]. - Civilian products are anticipated to experience slower growth, with revenue fluctuations expected, including a projected decline in 2024 [15][40]. - The company is also involved in contracted research and development, which is expected to see a significant decline in revenue over the forecast period [15][40]. Market Trends - The global solid rocket motor market is projected to grow from approximately 10.4 billion USD in 2024 to 23.1 billion USD by 2034, driven by defense modernization and missile system upgrades [48][52]. - The demand for solid rocket engines is expected to remain strong due to their application in tactical and strategic missile systems, as well as in space launch vehicles [52][50]. - The ammunition market is also expected to expand steadily, supported by both military and civilian applications [55][56].

Investment Rating - The investment rating for the company is "Accumulate" with a target price of 181.08 CNY per share [6][12]. Core Insights - The report highlights that the current market is active, and the company's future performance is expected to improve due to its focus on AI-enabled product advancements, which enhances its market competitiveness [2]. - The company is a leading provider in the securities trading system software market, primarily serving domestic securities firms with core products such as market analysis systems and trading systems [12]. - The report forecasts the company's net profit attributable to shareholders for 2025-2027 to be 335 million, 357 million, and 385 million CNY, respectively, with corresponding EPS estimates of 1.31, 1.39, and 1.50 CNY [12]. Financial Summary - Total revenue is projected to be 435 million CNY in 2023, decreasing to 389 million CNY in 2024, and then increasing to 429 million CNY in 2025, 465 million CNY in 2026, and 505 million CNY in 2027, reflecting a growth rate of 35.2% in 2023 and a decline of 10.5% in 2024 [4]. - Net profit attributable to shareholders is expected to be 311 million CNY in 2023, slightly decreasing to 304 million CNY in 2024, and then increasing to 335 million CNY in 2025, 357 million CNY in 2026, and 385 million CNY in 2027, with a growth rate of 102.4% in 2023 [4]. - The company's return on equity (ROE) is projected to be 9.1% in 2023, decreasing to 8.4% in 2024, and then gradually increasing to 9.0% by 2027 [4]. Market Data - The company's market capitalization is approximately 36.377 billion CNY, with a total share count of 256 million shares [7]. - The stock price has ranged between 96.68 CNY and 180.13 CNY over the past 52 weeks [7]. Competitive Position - The company has a strong competitive position in the market, with its securities trading system being a core product and facing limited competition from firms like Tonghuashun and Dazhihui [12]. - The company has successfully integrated AI capabilities into its products, enhancing its offerings and adapting to the evolving market demands [12].

Group 1: Market Overview - In 2026, the A-share M&A market is expected to focus on three main industrial lines: hard technology, cyclical industries, and state-owned enterprise restructuring[2] - The macroeconomic environment will emphasize the synergy between capital markets and the real economy, supported by a moderately loose monetary policy to lower financing costs[9] - In 2025, the A-share M&A market saw 1,632 asset acquisition announcements, a 14% increase year-on-year, with significant asset restructuring transactions rising by 80%[10] Group 2: Industrial Lines - The hard technology sector will be a key focus, with mergers in AI applications, commercial aerospace, and humanoid robotics expected to accelerate[17] - Cyclical industries will see consolidation through supply-side reforms, particularly in solar energy, automotive, and brokerage sectors, with a focus on optimizing supply-demand structures[22] - State-owned enterprises are anticipated to engage in significant asset restructuring and mergers, with a focus on strategic and commercial asset injections[25] Group 3: Transaction Lines - Control transactions in listed companies are expected to show structural differentiation, with a shift towards "industrial logic" rather than "arbitrage logic" due to regulatory changes[27] - The role of state-owned capital in M&A funds is expected to grow, with 29 new funds established in 2025, targeting over 100 billion yuan in total[32] - Innovative cross-border M&A transactions are likely to continue, with a focus on integrating global high-quality technology assets and enhancing A+H market synergy[37] Group 4: Risks and Challenges - M&A transactions involving equity stakes face higher uncertainties compared to cash transactions, with financial capacity of listed companies significantly impacting deal success[41] - The tightening of regulatory policies may increase the difficulty of mergers, particularly for cross-border transactions and those involving shell companies[41] - The restructuring of ST companies presents both opportunities and high risks, dependent on the successful execution of restructuring plans[43]

| | 国泰海通证券 | | --- | --- | | 2 | GUOTAI HAITONG SECURITIES | 目 录 | | 每日报告精选（2025-12-31 09:00——2026-01-05 15:00） 3 | | | --- | --- | --- | |  | 宏观周报：《地缘风险再起，国际油价或迎剧烈波动》2026-01-04 | 3 | |  | 宏观周报：《元旦"微度假"热度高》2026-01-04 | 3 | |  | 宏观快报点评：《PMI 逆季节性回升，预期改善》2025-12-31 | 4 | |  | 策略专题报告：《1 月金股策略：决胜"开门红"》2026-01-05 | 5 | |  | 资产配置周报：《地缘政治突变，建议超配黄金》2026-01-05 | 6 | |  | 策略专题报告：《AI 应用与机器人主题有望接力》2026-01-04 | 6 | |  | 海外策略研究：《长线外资积极增配港股软件服务》2026-01-04 | 7 | |  | 策略周报：《一年之计在于春》2026-01-04 | 8 | |  | 行业月报：房地产《TOP ...

Investment Rating - The report assigns a rating of "Buy" for the company [5]. Core Insights - The company focuses on high-end hydrodynamic oil film sliding bearings, with rapid growth in downstream demand from sectors such as wind power, nuclear power, gas turbines, and generators, indicating a potential for sustained performance [2][12]. - The projected earnings per share (EPS) for 2025, 2026, and 2027 are estimated to be 1.58, 1.86, and 2.19 yuan respectively, with a target price set at 65.10 yuan based on a 35x price-to-earnings (PE) ratio for 2026 [12][18]. Financial Summary - Total revenue is projected to grow from 523 million yuan in 2023 to 812 million yuan in 2027, reflecting a compound annual growth rate (CAGR) of approximately 16.2% [4][16]. - Net profit attributable to the parent company is expected to increase from 101 million yuan in 2023 to 190 million yuan in 2027, with a CAGR of 17.8% [4][16]. - The company’s return on equity (ROE) is forecasted to rise from 7.1% in 2023 to 10.0% in 2027 [4][16]. Market Position - The company has established a diversified product model centered on hydrodynamic oil film sliding bearings, with a strong technological foundation and a global customer base including major players like GE and Shanghai Electric [12][18]. - The hydrodynamic oil film sliding bearings market in China is projected to grow from 3.23 billion yuan in 2020 to approximately 6.72 billion yuan by 2026, with a compound annual growth rate (CAGR) of over 13% [12][18]. Industry Context - The demand for hydrodynamic oil film sliding bearings is driven by their advantages such as high speed, excellent load-bearing capacity, low friction coefficient, long service life, and strong impact resistance, making them suitable for various high-tech strategic emerging industries [12][18]. - The company’s products are increasingly being adopted in nuclear power and gas turbine applications, indicating a growing market for high-end energy equipment [12][18].

Investment Rating - The investment rating for the company is "Accumulate" with a target price of 7.07 CNY [1][3]. Core Insights - The company's net profit attributable to shareholders decreased by 15.9% year-on-year for the first three quarters of 2025, while new contracts signed increased by 6.5% [2][4]. - The company is implementing a comprehensive strategic layout across the province, nation, industry chain, and globally, leveraging its integrated "investment, construction, and operation" model [2][5]. Financial Performance Summary - For the first three quarters of 2025, total revenue was 450.3 billion CNY, a decrease of 16.6% year-on-year. The net profit attributable to shareholders was 8.1 billion CNY, down 15.9% year-on-year [4]. - The gross profit margin increased by 0.9 percentage points to 13.1%, while the net profit margin rose slightly to 1.8% [4]. - The company’s operating cash flow net outflow narrowed to 19.7 billion CNY, compared to a net outflow of 52.6 billion CNY in the same period of 2024 [5]. Order Book and Market Strategy - New contracts signed in the first three quarters of 2025 totaled 1,122.1 billion CNY, reflecting a 6.5% increase year-on-year [5][15]. - The breakdown of new contracts includes 1,093.3 billion CNY from engineering construction, with significant contributions from infrastructure projects [15]. - The company is focusing on expanding its market presence and accelerating transformation in traditional industries towards digitalization, intelligence, and sustainability [5][15]. Financial Forecast - The earnings per share (EPS) estimates for 2025, 2026, and 2027 are projected to be 0.70 CNY, 0.78 CNY, and 0.86 CNY respectively, reflecting a decrease of 11.1% in 2025, followed by growth in subsequent years [3][6]. - The company is expected to maintain a price-to-earnings (PE) ratio of 9.1 times for 2026, with a target price of 7.07 CNY [3][6]. Valuation Metrics - The current dividend yield is 4.1%, with a dividend payout ratio of 34.5% for the 2024 annual report [5]. - The company’s market capitalization is approximately 8,051 million CNY, with a price-to-book (PB) ratio of 0.5 [7][8].

Economic Overview - Vietnam's GDP growth averaged 7.2% from 1988 to 1999, significantly higher than the emerging market average of 3.7%[5] - From 2000 to 2024, Vietnam's GDP growth averaged 6.4%, surpassing the emerging market average of 5.2% and the global average of 3.5%[5] - In 2024, Vietnam's GDP reached approximately $460 billion, marking a 50-fold increase since 1990[8] Foreign Investment and Trade - Foreign Direct Investment (FDI) accounted for 14.3% of fixed asset formation in Vietnam as of 2023, well above the global average of 5.1%[14] - Vietnam's trade surplus reached $24.2 billion in 2024, with trade accounting for 170.9% of GDP, significantly higher than the global average of 57%[18] - Vietnam's exports to the U.S. constituted 29.5% of its total exports by 2024, while imports from China made up 37.8% of total imports[22] Industry Focus for Chinese Enterprises - Chinese enterprises in Vietnam primarily focus on industrial (28.0%), consumer (28.0%), and information technology (25.6%) sectors, collectively accounting for over 81% of their presence[28] - In the industrial sector, over 40% of Chinese investments are in electrical equipment, while the consumer sector sees over 50% in automotive and parts[30] Compliance Considerations - Vietnam has 25 prohibited industries and 59 industries with market entry restrictions for foreign investors as per the new Investment Law[42] - Foreign companies can lease land for up to 50 years, extendable to 70 years under certain conditions[47] - Foreign workers must obtain a labor permit to work in Vietnam, with specific exemptions for company owners and board members[48]

Macro Research - The recovery momentum in consumption is strong, but investment and production still require further policy support [2] - The A-share market is expected to welcome a "spring opening red" as policy expectations, liquidity, and fundamentals resonate positively [2] - The price signals indicate that industrial prosperity is beginning to emerge and continue [2] Strategy Research - The A-share market closed 2025 at 3968.84 points, with an annual increase of 18.41%, confirming the strategic judgment made by Guotai Junan [3] - The market is anticipated to stabilize and appreciate due to the upcoming announcement of the new Federal Reserve chairman and expectations of U.S. interest rate cuts in 2026 [3][24] - The decision-makers have emphasized the need to "promote investment stabilization," indicating a potential increase in policy support for growth [3][24] Food and Beverage Research - Yanjing Beer shows strong reform momentum, with significant potential for national expansion of its U8 product line, expected to exceed 1.5 million tons in the future [3][8] - The company is expected to enhance its product structure and profitability through the expansion of high-priced products above 10 yuan [8][9] - The beer industry is stabilizing, with leading companies like Yanjing benefiting from structural upgrades and improved profit margins [8][9] Industry Comparison - The report highlights a favorable outlook for technology, non-bank financials, and consumer sectors, driven by the industrialization of emerging markets and the AI trend [6][27] - The technology sector is expected to benefit from global chip technology breakthroughs and rising storage prices, with domestic infrastructure shortages accelerating the pace of domestic production [6][27] - Non-bank financials are poised to gain from increased wealth management demand and capital market reforms, while cyclical stocks are seen as bottoming out and benefiting from domestic demand expansion [6][27]

Investment Rating - The report maintains an "Overweight" rating for the real estate sector, indicating a positive outlook for the industry in the upcoming year [3][23]. Core Insights - The year 2026 marks the beginning of the "14th Five-Year Plan," with expectations for high-quality development in the real estate sector. The current new housing market, valued at 8 trillion yuan, shows potential for absorption, particularly as fiscal policies are expected to strengthen and a competitive landscape among blue-chip companies emerges [2][23]. - In December 2025, the top 100 real estate companies achieved a sales amount of 3,246.5 billion yuan, reflecting a month-on-month increase of 39.3% but a year-on-year decrease of 26.1%. The equity sales amount reached 2,615.3 billion yuan, with a month-on-month increase of 42.0% and a year-on-year decrease of 28.7% [4][7]. Summary by Sections Sales Performance - In December 2025, the top 100 real estate companies recorded a total sales amount of 31,344.8 billion yuan, down 19.0% year-on-year, with a narrowing decline compared to November 2025. The equity sales amount was 24,645.1 billion yuan, down 20.1% year-on-year [7][11]. - The top 50 companies had a sales amount of 27,341.2 billion yuan, down 18.6% year-on-year, while the equity sales amount was 21,143.8 billion yuan, down 18.8% year-on-year [11][17]. Company Recommendations - The report recommends several companies for investment: 1. Development companies: Vanke A, Poly Developments, China Overseas Development, and others [23]. 2. Commercial and residential: China Resources Land, Longfor Group [23]. 3. Property management: Wanwu Cloud, China Overseas Property, Poly Property, and others [23]. 4. Cultural tourism: Overseas Chinese Town A [23]. Monthly Sales Trends - In December 2025, the majority of the top 100 companies experienced negative year-on-year sales growth. Notably, China Overseas Development led with a monthly sales figure of 380 billion yuan, followed by China Resources Land at 369 billion yuan [19][23]. - Among the top 50 companies, nine achieved positive year-on-year growth, with China State Construction East achieving the highest growth rate of 213.2% [19][23].

Group 1 - The report suggests tactical overweighting in A/H shares, US stocks, and gold, while recommending standard allocation in government bonds and underweighting in oil due to rising global risk aversion driven by geopolitical changes in South America [2][3][18] - Multiple factors support the performance of Chinese equities, including expectations of expanded fiscal deficits and more proactive economic policies as the 14th Five-Year Plan begins [16][17] - The US stock market is expected to perform well, supported by resilient corporate earnings and a cautious monetary policy direction from the Federal Reserve, despite marginal economic cooling [16][17] Group 2 - The report highlights the importance of gold as a safe-haven asset amid rising geopolitical uncertainties, with central banks continuing to purchase gold, which supports long-term price stability [18][19] - The oil market is anticipated to face short-term volatility, with consistent supply-demand expectations and geopolitical events potentially increasing US influence on global oil prices, leading to continued pressure on oil prices [18][19] - The tactical asset allocation model indicates a strategic weight of 45% in equities, 45% in bonds, and 10% in commodities, with specific allocations detailed for various asset classes [20][26]