Investment Rating - The report maintains a "Buy" rating for Nvidia (NVDA.O) based on strong demand for AI computing and robust shipment momentum from the Blackwell architecture [4][6]. Core Insights - Nvidia's FY26Q1 revenue reached $44.062 billion, exceeding market expectations with a year-over-year growth of 69% and a quarter-over-quarter increase of 12% [1][2]. - The company's guidance for FY26Q2 is slightly below consensus expectations, projecting revenue of $45 billion, which is lower than the Bloomberg consensus of $45.454 billion [1][4]. - The data center business is a key growth driver, with FY26Q1 revenue of $39.112 billion, reflecting a year-over-year increase of 73% [2][3]. Summary by Sections Financial Performance - FY26Q1 revenue was $44.062 billion, with a Non-GAAP gross margin of 61.0%, down from previous periods due to $4.5 billion in inventory and procurement obligations related to H20 [1][4]. - Non-GAAP net profit for FY26Q1 was $19.894 billion, with a corresponding Non-GAAP EPS of $0.81, surpassing the consensus estimate of $0.93 [1][4]. Business Segments - **Data Center Business**: Revenue of $39.112 billion in FY26Q1, with a significant contribution from Blackwell architecture, which is nearing completion in its transition [2][3]. - **Gaming Business**: Revenue reached $3.763 billion, marking a historical high driven by the launch of Blackwell architecture chips [3]. - **Automotive Business**: Revenue of $567 million, showing a year-over-year growth of 72%, primarily due to increased demand for autonomous driving [3]. Profitability Forecast - The report revises Nvidia's GAAP net profit estimates for FY2026 to FY2028 downwards to $113.882 billion, $149.200 billion, and $182.477 billion respectively, reflecting a year-over-year growth of 56%, 31%, and 22% [4][5]. - The projected GAAP EPS for FY2026, FY2027, and FY2028 are $4.67, $6.11, and $7.48 respectively [5][4].

Report Summary 1. Investment Rating No investment rating for the industry is provided in the report. 2. Core View The convertible bond market showed a slight recovery this week with continuous narrow - range fluctuations. Since the beginning of 2025, the convertible bond market has outperformed the equity market. Tariffs, fundamental trends, and macro - policies remain important influencing factors for the current convertible bond market. At present, investors can continue to focus on convertible bonds with excellent performance of underlying stocks in areas such as boosting domestic demand and domestic substitution [1][4]. 3. Summary by Directory Market行情 - From May 26 to May 30, 2025 (5 trading days), the convertible bond market slightly recovered with continuous narrow - range fluctuations. The weekly change of the CSI Convertible Bond Index was +0.2% (compared to - 0.1% in the previous trading week), while the CSI All - Share Index changed by - 0.1%. Since the beginning of 2025, the CSI Convertible Bond Index has risen by +3.6%, and the CSI All - Share Index has risen by +0.3%, indicating that the convertible bond market has performed better than the equity market [1]. - By rating, high - rated bonds (AA + and above), medium - rated bonds (AA), and low - rated bonds (AA - and below) had weekly changes of +0.27%, +0.03%, and - 0.04% respectively, with high - rated bonds having the largest increase. By convertible bond scale, large - scale convertible bonds (bond balance > 5 billion yuan), medium - scale convertible bonds (balance between 500 million and 5 billion yuan), and small - scale convertible bonds (balance < 500 million yuan) had weekly changes of +0.22%, +0.01%, and +0.01% respectively, with large - scale convertible bonds having the largest increase. By conversion parity, ultra - high - parity bonds (conversion value > 130 yuan), high - parity bonds (conversion value between 110 and 130 yuan), medium - parity bonds (conversion value between 90 and 110 yuan), low - parity bonds (conversion value between 70 and 90 yuan), and ultra - low - parity bonds (conversion value < 70 yuan) had weekly changes of +0.62%, - 0.21%, +0.02%, - 0.05%, and - 0.05% respectively, with ultra - high - parity bonds having the largest increase. By industry, the top 30 convertible bonds in terms of increase mainly came from building materials (3), chemical industry (3), electronics (3), and building decoration (3); the top 30 convertible bonds in terms of decline mainly came from the automobile (6), chemical industry (5), machinery and equipment (4), and household appliances (4) industries [2]. Convertible Bond Price, Parity, and Conversion Premium Rate - As of May 30, 2025, there were 473 outstanding convertible bonds (the same as at the end of last week), with a balance of 665.922 billion yuan (compared to 674.315 billion yuan at the end of last week). The average convertible bond price was 120.19 yuan (compared to 120.75 yuan last week), and the quantile was 72.9% (compared to 75.6% last week). The average convertible bond parity was 92.52 yuan (compared to 92.02 yuan last week), and the quantile was 61.5% (compared to 57.2% last week). The average conversion premium rate of convertible bonds was 30.3% (compared to 30.2% last week), and the quantile was 60.9% (compared to 60.8% last week). Among them, the conversion premium rate of medium - parity convertible bonds (conversion value between 90 and 110 yuan) was 23.4% (compared to 24.2% last week), higher than the median conversion premium rate of medium - parity convertible bonds since 2018 (19.8%) [3]. Convertible Bond Performance and Allocation Direction - The convertible bond market slightly recovered this week, with the CSI Convertible Bond Index rising by +0.2% and showing continuous narrow - range fluctuations recently. Since the beginning of 2025, the convertible bond market has outperformed the equity market. Looking forward, tariffs, fundamental trends, and macro - policies are still important influencing factors for the current convertible bond market. At present, investors can continue to focus on convertible bonds with excellent performance of underlying stocks in areas such as boosting domestic demand and domestic substitution [4]. Convertible Bond Rise Situation - The top 15 convertible bonds in terms of increase this week include Zhongqi Convertible Bond (18.54% increase), Limin Convertible Bond (16.22% increase), and Tianyang Convertible Bond (15.59% increase) [22].

Investment Rating - The report maintains a "Buy" rating for the company [5] Core Views - The company is expected to benefit from the upcoming release of new games and the progress in advertising commercialization [3] - The gaming business is anticipated to contribute positively to revenue growth, particularly with the launch of the S8 season of "Three Kingdoms" and the new mobile game "Shining! Yujun Girl" [1][2] - The company has a strong user base with MAU reaching 368 million and DAU at 107 million, indicating robust engagement [2] Summary by Sections Game Business Update - The company has updated its gaming portfolio with significant enhancements to "Shining! Yujun Girl" and the launch of the S8 season for "Three Kingdoms" [1] - The S7 season achieved a record high DAU, and the S8 season is expected to further boost user engagement through new features and events [1] Financial Performance - In Q1 2025, the company reported revenue of 7.003 billion RMB, a year-over-year increase of 24% [2] - The adjusted net profit for the same period was 362 million RMB, exceeding market expectations due to effective cost control [2] - The mobile gaming segment saw revenue growth of 76%, driven by stable performance from "Three Kingdoms" [2] AI Integration - AI technology has been deeply integrated into various business operations, enhancing content review efficiency and reducing production costs in game development [3] - The company plans to launch an AI tool for content creators by the end of 2025 [3] Profit Forecast and Valuation - The adjusted net profit forecasts for 2025 and 2026 have been raised to 2.146 billion RMB and 3.511 billion RMB, respectively [3][4] - The company is projected to achieve a revenue of 30.24 billion RMB in 2025, with a growth rate of 12.7% [4]

Investment Rating - The report maintains a "Buy" rating for Kuaishou-W (1024.HK) with a target price of HKD 68.8, compared to the current price of HKD 54.20 [4]. Core Views - Kuaishou's Q1 2025 performance slightly exceeded expectations, with total revenue of RMB 32.6 billion, a year-on-year increase of 10.9%, and adjusted net profit of RMB 4.58 billion, up 4.4% year-on-year [1][2]. - The growth in revenue is driven by the online marketing segment, which generated RMB 18 billion, reflecting an 8% year-on-year increase, and e-commerce GMV of RMB 332.3 billion, up 15.4% year-on-year [2]. - The report highlights the acceleration of commercialization for Kuaishou's AI capabilities, contributing to revenue growth and potential valuation increments [2]. Summary by Sections Financial Performance - Kuaishou's Q1 2025 gross margin was 54.6%, with operating profit at RMB 4.26 billion, a 6.6% year-on-year increase [1]. - Sales expenses rose to RMB 9.9 billion, a 5.5% increase year-on-year, attributed to increased subsidies for growth businesses [1]. - R&D expenses reached RMB 3.3 billion, a 16% increase year-on-year, reflecting investments in AI-related personnel [1]. Business Segments - Online marketing revenue was RMB 18 billion, slightly above expectations, driven by AI model improvements [2]. - E-commerce GMV was RMB 332.3 billion, with a 15.4% year-on-year growth, supported by a 30% increase in new merchants [2]. - Live streaming rewards reached RMB 9.8 billion, a 14.4% increase year-on-year, with significant growth in contracted agencies and streamers [2]. Growth Drivers - The commercialization of Kuaishou's AI, particularly the Keling AI, is expected to drive revenue growth, with Q1 2025 revenue from Keling AI exceeding RMB 150 million [2]. - Local life services revenue doubled year-on-year, and overseas revenue reached RMB 1.3 billion, a 33% increase year-on-year [2]. - User engagement metrics showed a 6% year-on-year increase in total usage time, with daily active users (DAU) at 410 million [2]. Profit Forecast and Valuation - The report slightly raises the adjusted net profit forecasts for 2025-2027 to RMB 20.13 billion, RMB 24.18 billion, and RMB 27.70 billion, respectively [2][3]. - The report emphasizes the potential valuation increment from Kuaishou's AI developments, with a target price of HKD 68.8 based on robust fundamentals [2].

Investment Rating - The report maintains a "Buy" rating for Kuaishou-W (1024.HK) with a target price of HKD 68.8, compared to the current price of HKD 54.20 [4]. Core Insights - Kuaishou's Q1 2025 performance slightly exceeded expectations, with total revenue of RMB 32.6 billion, a year-on-year increase of 10.9%, and adjusted net profit of RMB 4.58 billion, up 4.4% year-on-year [1][2]. - The company's gross margin was 54.6%, in line with expectations, while operating profit reached RMB 4.26 billion, reflecting a year-on-year growth of 6.6% [1]. - The report highlights the acceleration of AI commercialization as a potential valuation increment, particularly through the application of Kuaishou's AI capabilities across various sectors [2]. Revenue Breakdown - Online marketing revenue was RMB 18 billion, growing 8% year-on-year, driven by improved marketing material conversion efficiency from AI models [2]. - E-commerce GMV reached RMB 332.3 billion, a year-on-year increase of 15.4%, with active buyers growing by 7.1% to 135 million [2]. - Live streaming rewards amounted to RMB 9.8 billion, up 14.4% year-on-year, with significant growth in the number of contracted agencies and streamers [2]. Growth Drivers - The report notes that Kuaishou's AI, particularly the Keling AI, has been widely applied, generating over RMB 150 million in revenue in Q1 2025, contributing to a 15.2% increase in other revenues [2]. - Local life services revenue doubled year-on-year, with a 73% increase in monthly paying users, while overseas revenue grew by 33% to RMB 1.3 billion [2]. - User engagement metrics showed a 6% year-on-year increase in total usage time, with daily active users (DAU) and monthly active users (MAU) at 410 million and 710 million, respectively [2]. Financial Forecasts - The adjusted net profit forecasts for 2025-2027 have been slightly raised to RMB 20.13 billion, RMB 24.18 billion, and RMB 27.70 billion, reflecting a modest increase from previous estimates [2][3]. - Revenue projections for 2025 are set at RMB 142.6 billion, with a growth rate of 12.4% [3]. - The report indicates a stable fundamental outlook, with potential valuation increments driven by advancements in AI applications [2].

Investment Rating - The report maintains an "Increase" rating for the petrochemical and chemical transportation industry [6] Core Viewpoints - The process of domestic substitution continues to advance, with a positive outlook on semiconductor materials, MXD6, and ion exchange resins [1][2] - The U.S. government has effectively cut off certain American companies from selling semiconductor design software to China, impacting companies like Cadence, Synopsys, and Siemens EDA [2] - Global semiconductor sales are expected to improve in 2024, with an estimated sales figure of approximately $630.5 billion, representing a year-on-year growth of about 19.7% [2] - The semiconductor materials industry in China has achieved significant progress in key areas, but high-end materials remain dominated by foreign manufacturers, necessitating innovation and increased domestic production [2] - MXD6, a high-performance engineering plastic, is projected to grow from $410 million in 2024 to $760 million by 2033, with a CAGR of approximately 7.1% [3] - The ion exchange resin market is primarily dominated by foreign companies, but domestic leaders are making strides in substituting imports and enhancing their market competitiveness [4] Summary by Sections Semiconductor Materials - The semiconductor market is expected to reach $697.1 billion in 2025, with a year-on-year growth of 11% [2] - Domestic semiconductor materials have largely achieved production in key areas, but high-end materials still rely heavily on imports [2] MXD6 - MXD6 is utilized in lightweight applications for automobiles and drones, with domestic companies overcoming technical barriers to increase production [3] - Major domestic players are ramping up production capabilities, with projects like the 5,000 tons/year MXD6 project by Qicai Chemical entering trial production [3] Ion Exchange Resins - The high-end ion exchange resin market is largely monopolized by foreign companies, but domestic firms are progressively replacing imports and enhancing their brand recognition [4] - Domestic companies like Blue Sky Technology and Jiangsu Suqing are achieving competitive performance in core products [4] Investment Recommendations - The report suggests focusing on undervalued, high-dividend, and well-performing companies in the "three barrels of oil" and oil service sectors, as well as materials companies benefiting from domestic substitution trends [5]

Investment Rating - The report maintains an "Overweight" rating for the petrochemical and chemical transportation industry [6] Core Viewpoints - The process of domestic substitution continues to advance, with a positive outlook on semiconductor materials, MXD6, and ion exchange resins [1][2] - The U.S. government has effectively cut off certain American companies from selling semiconductor design software to China, impacting companies like Cadence, Synopsys, and Siemens EDA [2] - Global semiconductor sales are expected to improve in 2024, with an estimated sales figure of approximately $630.5 billion, representing a year-on-year growth of about 19.7% [2] - The semiconductor materials industry in China has achieved significant progress in key areas, but high-end materials are still dominated by foreign manufacturers [2] - MXD6, a high-performance engineering plastic, is projected to grow from $410 million in 2024 to $760 million by 2033, with a CAGR of approximately 7.1% [3] - The ion exchange resin market is primarily dominated by foreign leaders, but domestic companies are making strides in achieving domestic substitution [4] Summary by Sections Semiconductor Materials - The semiconductor market is expected to reach $697.1 billion in 2025, with a year-on-year growth of 11% [2] - Domestic semiconductor materials have largely achieved layout or mass production in key areas, but high-end materials still rely heavily on imports [2] MXD6 - MXD6 is used in lightweight applications for automobiles and drones, with domestic companies overcoming technical barriers to increase production [3] - Major domestic players like Sinochem International and Qicai Chemical are advancing in MXD6 production capabilities [3] Ion Exchange Resins - The high-end ion exchange resin market is largely monopolized by multinational corporations, while domestic companies are gradually improving their competitive edge [4] - Domestic companies are achieving significant performance levels in core products and expanding their market influence [4] Investment Recommendations - The report suggests focusing on undervalued, high-dividend, and well-performing companies in the "three barrels of oil" and oil service sectors, including China National Petroleum, Sinopec, and CNOOC [5] - It also recommends attention to domestic material companies benefiting from the substitution trend, such as Jingrui Electric Materials and Tongcheng New Materials [5] - Positive monetary and fiscal policies are expected to benefit the real estate chain and leading companies, with a focus on agricultural chemicals and private refining sectors [5]

Group 1: Market Strategy - The report continues to focus on three asset categories, highlighting the monthly stock selection for A-shares and Hong Kong stocks for June 2025, including companies like Gree Electric, China Petroleum, and Tencent Holdings [1] Group 2: Fiscal Policy Analysis - The evolution of fiscal policy in China is analyzed, categorizing it into three major phases and eight sub-phases, with a shift from single to multiple objectives and a deepening understanding of fiscal sustainability constraints [2] Group 3: Industry Research - The report maintains a positive outlook on the "three major oil companies" and oil service sectors, recommending stocks such as China Petroleum and China National Offshore Oil Corporation, while also favoring domestic material companies benefiting from the trend of domestic substitution [3] - It also highlights the agricultural chemicals and private refining sectors, suggesting stocks like Wanhua Chemical and Hualu Hengsheng, and expresses optimism for the vitamin and methionine sectors with recommendations for companies like Zhejiang Medicine [3] Group 4: Company Research - Xiaomi Group's Q1 2025 performance shows a return to the top of the domestic smartphone market, with record revenue and adjusted net profit, supported by advancements in self-developed chips and AI models, leading to an upward revision of profit forecasts for 2025-2027 [4] - Pinduoduo's Q1 2025 revenue increased by 10.2% year-on-year, but GAAP net profit declined by 47.3%, prompting a downward adjustment of profit forecasts for the next three years [5] - Meituan's Q1 2025 revenue grew by 18.1%, with a significant increase in net profit, although future profit forecasts were also adjusted downward due to ongoing industry competition [7]

Investment Rating - The report maintains a "Buy" rating for the company [4] Core Views - The company's revenue for Q1 2025 reached 95.672 billion yuan, a year-on-year increase of 10.2%, while GAAP net profit decreased by 47.3% to 14.742 billion yuan [1] - The decline in profit is attributed to increased costs from platform investments and uncertainties in overseas tariffs, leading to a downward revision of profit forecasts for 2025, 2026, and 2027 by 34%, 37%, and 41% respectively [4] Summary by Sections Financial Performance - In Q1 2025, the company's gross margin was 57.2%, down 5.1 percentage points year-on-year, primarily due to ongoing overseas expansion and investments to maintain platform competitiveness [2] - Sales expense ratio increased by 7.9 percentage points to 34.9% due to higher promotional expenditures [2] Revenue Streams - Online marketing service revenue grew by 15% year-on-year to 48.722 billion yuan, while commission revenue increased by 6% to 46.950 billion yuan [3] - The company has implemented measures to support merchants and optimize the platform ecosystem, including the establishment of a "Merchant Rights Protection Committee" and a "Billion Support" strategy [3] Profit Forecasts and Valuation - The report provides a detailed profit forecast, with expected revenues of 437.712 billion yuan in 2025, reflecting an 11% growth rate [5] - GAAP net profit is projected to be 91.006 billion yuan in 2025, indicating a decline of 19% compared to the previous year [5]

Investment Rating - The report maintains a "Buy" rating for the company [4] Core Views - The company's revenue for Q1 2025 increased by 10.2% year-on-year, while GAAP net profit decreased by 47.3% [1] - The decline in profit is attributed to increased costs from platform investments and uncertainties in overseas tariffs [4] - The company is focusing on enhancing platform competitiveness and supporting merchants through various initiatives [3] Revenue and Profitability - Q1 2025 revenue reached 956.72 billion yuan, with a GAAP net profit of 147.42 billion yuan [1] - The company's gross margin for Q1 2025 was 57.2%, down 5.1 percentage points year-on-year, primarily due to overseas expansion and increased promotional spending [2] - Online marketing service revenue grew by 15% year-on-year, while commission revenue increased by 6% [3] Cost Structure - Sales expense ratio increased by 7.9 percentage points to 34.9% in Q1 2025, driven by higher promotional expenditures [2] - Management expense ratio decreased slightly to 1.7%, reflecting improved overall efficiency [2] Future Earnings Forecast - The earnings forecast for GAAP net profit has been revised down by 34%/37%/41% for 2025/2026/2027 to 910.06/1002.16/1082.33 billion yuan [4] - Revenue projections for 2025 are estimated at 437.71 billion yuan, with a growth rate of 11% [5] Valuation Metrics - The report provides a P/E ratio of 11 for 2025 and a P/B ratio of 2.4 [5][13] - The expected EPS for 2025 is 16.03 yuan [5]