Quantitative Models and Construction Methods - **Model Name**: Timing Radar Six-Dimensional Framework **Model Construction Idea**: The equity market is influenced by multiple dimensions of factors. This model selects 21 indicators from six dimensions: liquidity, economic fundamentals, valuation, capital flow, technicals, and crowding. These are summarized into four categories: "valuation cost-effectiveness," "macro fundamentals," "capital & trend," and "crowding & reversal," generating a composite timing score between [-1, 1][1][6][8] **Model Construction Process**: 1. Select 21 indicators across six dimensions 2. Group indicators into four categories: - Valuation cost-effectiveness - Macro fundamentals - Capital & trend - Crowding & reversal 3. Normalize the composite score to a range of [-1, 1] **Model Evaluation**: The model provides a comprehensive view of market conditions by integrating multiple dimensions, offering a balanced perspective on market timing[1][6][8] --- Quantitative Factors and Construction Methods Liquidity Factors 1. **Factor Name**: Monetary Direction Factor **Factor Construction Idea**: Measures the direction of monetary policy using central bank policy rates and short-term market rates[10] **Factor Construction Process**: - Calculate the average change in policy rates and short-term market rates over the past 90 days - If the factor > 0, monetary policy is considered expansionary; if < 0, it is contractionary **Factor Evaluation**: Effectively captures monetary policy direction[10] 2. **Factor Name**: Monetary Intensity Factor **Factor Construction Idea**: Based on the "interest rate corridor" concept, measures the deviation of short-term market rates from policy rates[12] **Factor Construction Process**: - Calculate deviation = DR007/7-year reverse repo rate - 1 - Smooth and z-score the deviation to form the factor - If the factor < -1.5 standard deviations, it indicates a loose environment; if > 1.5, it indicates a tight environment **Factor Evaluation**: Captures the relative intensity of monetary policy[12] 3. **Factor Name**: Credit Direction Factor **Factor Construction Idea**: Reflects the transmission of credit to the real economy using medium- and long-term loan data[15] **Factor Construction Process**: - Calculate the year-on-year growth of medium- and long-term loans over the past 12 months - If the factor rises compared to three months ago, it signals a positive trend; otherwise, negative **Factor Evaluation**: Provides insights into credit flow trends[15] 4. **Factor Name**: Credit Intensity Factor **Factor Construction Idea**: Measures whether credit data significantly exceeds or falls short of expectations[18] **Factor Construction Process**: - Calculate (new RMB loans - median forecast)/forecast standard deviation - If the factor > 1.5 standard deviations, it indicates a significantly positive credit environment; if < -1.5, it indicates a negative environment **Factor Evaluation**: Captures unexpected credit changes effectively[18] Economic Factors 1. **Factor Name**: Growth Direction Factor **Factor Construction Idea**: Based on PMI data, measures the direction of economic growth[20] **Factor Construction Process**: - Calculate the 12-month moving average of PMI and its year-on-year change - If the factor rises compared to three months ago, it signals a positive trend; otherwise, negative **Factor Evaluation**: Reflects economic growth trends accurately[20] 2. **Factor Name**: Growth Intensity Factor **Factor Construction Idea**: Measures whether economic growth data significantly exceeds or falls short of expectations[23] **Factor Construction Process**: - Calculate (PMI - median forecast)/forecast standard deviation - If the factor > 1.5 standard deviations, it indicates significantly positive growth; if < -1.5, it indicates negative growth **Factor Evaluation**: Captures unexpected economic growth changes effectively[23] 3. **Factor Name**: Inflation Direction Factor **Factor Construction Idea**: Measures the direction of inflation using CPI and PPI data[25] **Factor Construction Process**: - Calculate 0.5 × smoothed CPI year-on-year + 0.5 × raw PPI year-on-year - If the factor decreases compared to three months ago, it signals a deflationary environment; otherwise, inflationary **Factor Evaluation**: Reflects inflation trends effectively[25] 4. **Factor Name**: Inflation Intensity Factor **Factor Construction Idea**: Measures whether inflation data significantly exceeds or falls short of expectations[27] **Factor Construction Process**: - Calculate (CPI or PPI - median forecast)/forecast standard deviation - If the factor < -1.5, it indicates significantly lower-than-expected inflation; if > 1.5, it indicates higher-than-expected inflation **Factor Evaluation**: Captures unexpected inflation changes effectively[27] Valuation Factors 1. **Factor Name**: Shiller ERP **Factor Construction Idea**: Adjusts for economic cycles to measure equity risk premium[28] **Factor Construction Process**: - Calculate Shiller PE using 6-year inflation-adjusted average earnings - Compute ERP = 1/Shiller PE - 10-year government bond yield - Normalize using a 6-year z-score **Factor Evaluation**: Provides a cyclically adjusted view of equity valuation[28] 2. **Factor Name**: PB **Factor Construction Idea**: Measures valuation using price-to-book ratio[31] **Factor Construction Process**: - Multiply PB by -1 and normalize using a 6-year z-score - Standardize to ±1 after 1.5 standard deviation truncation **Factor Evaluation**: Offers a straightforward valuation metric[31] 3. **Factor Name**: AIAE **Factor Construction Idea**: Reflects market-wide equity allocation and risk appetite[33] **Factor Construction Process**: - Calculate AIAE = total market cap of CSI All Share/(total market cap + total corporate debt) - Multiply AIAE by -1 and normalize using a 6-year z-score **Factor Evaluation**: Captures market risk appetite effectively[33] Capital Flow Factors 1. **Factor Name**: Margin Trading Increment **Factor Construction Idea**: Measures market leverage through margin trading trends[36] **Factor Construction Process**: - Calculate the difference between financing and short-selling balances - Compare the 120-day average increment with the 240-day average increment - If the 120-day increment > 240-day increment, it signals a positive trend; otherwise, negative **Factor Evaluation**: Reflects market sentiment and leverage trends[36] 2. **Factor Name**: Turnover Trend **Factor Construction Idea**: Measures market activity through turnover trends[39] **Factor Construction Process**: - Calculate log turnover moving average distance = ma120/ma240 - 1 - If max(10, 30, 60-day moving averages) is positive, it signals a positive trend; otherwise, negative **Factor Evaluation**: Captures market activity effectively[39] 3. **Factor Name**: China Sovereign CDS Spread **Factor Construction Idea**: Reflects foreign investors' perception of China's economic and credit risk[43] **Factor Construction Process**: - Calculate the 20-day difference of smoothed CDS spreads - If the difference < 0, it signals a positive trend; otherwise, negative **Factor Evaluation**: Provides insights into foreign capital flow trends[43] 4. **Factor Name**: Overseas Risk Aversion Index **Factor Construction Idea**: Captures global market risk appetite using Citi RAI Index[45] **Factor Construction Process**: - Calculate the 20-day difference of smoothed RAI - If the difference < 0, it signals a positive trend; otherwise, negative **Factor Evaluation**: Reflects global risk sentiment effectively[45] Technical Factors 1. **Factor Name**: Price Trend **Factor Construction Idea**: Measures market trend direction and strength using moving averages[47] **Factor Construction Process**: - Calculate moving average distance = ma120/ma240 - 1 - Compute trend direction and strength scores, then average them **Factor Evaluation**: Captures market trend dynamics effectively[47] 2. **Factor Name**: New Highs and Lows **Factor Construction Idea**: Uses the difference between new highs and lows as a reversal signal[49] **Factor Construction Process**: - Calculate the 20-day moving average of new lows - new highs - If the value > 0, it signals a bottoming market; otherwise, a topping market **Factor Evaluation**: Provides reversal signals effectively[49] Crowding Factors 1. **Factor Name**: Implied Premium/Discount **Factor Construction Idea**: Derived from option pricing, reflects market sentiment[53] **Factor Construction Process**: - Use the put-call parity to calculate implied premium/discount

Investment Rating - The report maintains an "Accumulate" rating for the pharmaceutical and biotechnology sector [7]. Core Insights - The report highlights that the pharmaceutical index increased by 3.29% during the week of November 10-14, 2025, indicating a positive market trend for innovative drugs and flu-related products [11][12]. - The report emphasizes the ongoing investment phase of major products in the pharmaceutical sector, particularly focusing on the BD (Business Development) second act for companies like Sanofi and their collaboration with Pfizer on SSGJ-707 [20][28]. - The report projects a bullish outlook for innovative drugs over the next 5-10 years, suggesting that a new wave of innovation and a bull market for innovative drugs is just beginning, with a focus on "disruption" rather than mere revaluation [14][12]. Summary by Sections 1. Recent Performance - The pharmaceutical sector showed resilience with a 3.29% increase in the index, while innovative drugs and flu treatments performed particularly well [11][12]. - The market is experiencing a rotation between high and low styles, benefiting both consumer and pharmaceutical sectors, especially innovative drugs [12][13]. 2. Investment Strategies - The report outlines specific investment strategies focusing on innovative drugs, including major overseas pharmaceutical companies and small to mid-cap technology revolutions [15][16]. - Key companies to watch include Innovent Biologics, Sanofi, and others in the innovative drug space, as well as those involved in new technologies like brain-computer interfaces and AI in healthcare [15][16]. 3. Future Outlook - The report anticipates continued optimism in the pharmaceutical sector, particularly around innovative drugs, with a focus on overseas major drugs and small-cap technology revolutions [14][15]. - It suggests that the investment landscape will evolve with a focus on leading companies that exhibit characteristics of leadership, disruption, and seriousness in their operations [14]. 4. Clinical Development Highlights - Pfizer's global clinical development plan for SSGJ-707 was disclosed, marking a significant milestone for Sanofi, with a $1.25 billion upfront payment for the collaboration [17][20]. - The report notes that the clinical trial phase for SSGJ-707 is just beginning, which is expected to catalyze further stock price increases for Sanofi [28][20]. 5. Sector Performance Comparison - The report compares the performance of the innovative drug index against the broader pharmaceutical index and the CSI 300 index, noting that the innovative drug index has outperformed both [31][32]. - The innovative drug index has increased by 30.65% since the beginning of 2025, indicating strong market interest and performance [32].

Investment Rating - The report maintains an "Overweight" rating for the real estate industry [4][6]. Core Insights - The report emphasizes that the current policy environment is being driven by fundamental pressures, suggesting that the policy response may exceed the levels seen in 2008 and 2014 [4]. - Real estate is identified as an early-cycle indicator, serving as a barometer for economic trends, making it a strategic investment focus [4]. - The competitive landscape within the industry is improving, with leading state-owned enterprises and select mixed-ownership and private firms expected to benefit more in the future [4]. - The report continues to support investment in first-tier cities and two-thirds of second-tier cities, indicating that this combination has historically performed better during sales rebounds [4]. - Supply-side policies, including land storage and management of idle land, are highlighted as critical areas to monitor, with first and second-tier cities likely to benefit more from these changes [4]. Summary by Sections New Housing Market - In the week, new housing transaction area in 30 cities was 1.59 million square meters, showing a week-on-week increase of 17.4% but a year-on-year decrease of 34.6% [2]. - The new housing transaction area for first-tier cities was 432,000 square meters, up 12.6% week-on-week but down 42.5% year-on-year [2]. - Second-tier cities recorded a transaction area of 881,000 square meters, up 24.7% week-on-week and down 23.4% year-on-year [2]. - Third-tier cities had a transaction area of 276,000 square meters, up 4.9% week-on-week but down 47.7% year-on-year [2]. Second-Hand Housing Market - The total transaction area for second-hand housing in 14 sample cities was 2.003 million square meters, reflecting a week-on-week growth of 4.7% but a year-on-year decline of 17.0% [2]. - First-tier cities accounted for 856,000 square meters in second-hand transactions, up 8.7% week-on-week [2]. - Second-tier cities had a transaction area of 873,000 square meters, up 1.4% week-on-week [2]. - Third-tier cities recorded 273,000 square meters, up 3.7% week-on-week [2]. Credit Bonds - In the week of November 10-16, four credit bonds were issued by real estate companies, a decrease of eight from the previous week, with a total issuance of 3.62 billion yuan, down 6.63 billion yuan [3]. - The total repayment amount was 10.829 billion yuan, an increase of 4.359 billion yuan, resulting in a net financing amount of -7.209 billion yuan, down 10.989 billion yuan [3]. Market Performance - The report notes that the Shenwan Real Estate Index had a cumulative change of 2.7%, outperforming the CSI 300 Index by 3.78 percentage points, ranking 7th among 31 Shenwan primary industries [14]. - A total of 84 stocks in the real estate sector rose, while 30 stocks fell, with the top five gainers being Qianjing Garden, China Wuyi, Huaxia Happiness, Guancheng Datong, and Rongsheng Development, with gains of 61.0%, 30.0%, 26.3%, 21.6%, and 18.2% respectively [14].

Investment Rating - The report maintains a "Buy" rating for the industry [6] Core Insights - The semiconductor industry is experiencing strong demand driven by AI computing power, leading to a supply-demand imbalance and price increases in storage components [2][30] - SMIC's revenue is expected to exceed $9 billion for the first time, with Q3 2025 revenue reaching $2.38 billion, a year-on-year increase of 9.7% [11][30] - The storage market is facing a short-term supply gap, with NAND flash prices increasing by up to 50% due to manufacturers' price hikes and supply control strategies [2][32] Summary by Sections SMIC Performance - SMIC's Q3 2025 revenue reached $2.38 billion, with a gross profit of $522.81 million and a gross margin of 22.0%, reflecting continuous improvement in profitability [11][12] - The company's monthly production capacity increased from 991,300 wafers in Q2 to 1,022,800 wafers in Q3, with a capacity utilization rate of 95.8% [11][12] - The company expects Q4 2025 revenue to remain flat or grow by 2%, with a gross margin guidance of 18%-20% [30][31] Storage Market Dynamics - The storage market is experiencing widespread price increases, with NAND flash prices rising significantly due to supply constraints and manufacturers' price adjustments [2][32] - Major manufacturers like SanDisk and SK Hynix are implementing supply control strategies, leading to a forecasted price increase of 20%-30% [2][32] - The SSD market is also seeing price increases, with high-capacity products experiencing notable price hikes [38][40] Hon Hai Precision Industry - Hon Hai's Q3 2025 revenue reached NT$2.06 trillion, with a net profit of NT$57.67 billion, benefiting from strong AI computing demand [3] - The company anticipates a high double-digit growth in AI cabinet shipments for Q4 2025, driven by robust demand from major cloud service providers [3] Key Investment Targets - The report highlights several stocks with a "Buy" rating, including SMIC, with projected earnings per share (EPS) growth from 0.51 in 2024 to 0.67 in 2025 [8]

Investment Rating - The report maintains an "Accumulate" rating for the computer industry [4] Core Insights - The report identifies three categories of AI applications worth mid-term investment: Custom Agent Platforms, High Barrier Vertical Applications, and AI Infrastructure [10][12][26] - OpenAI's recent developments, including the Apps SDK and AgentKit, signify a shift towards creating an AI application ecosystem, allowing developers to build interactive applications within ChatGPT [12][13] - Major companies like Tencent and Alibaba are also developing their own AI ecosystems, with Tencent planning to integrate AI capabilities into WeChat and Alibaba revamping its mobile AI application to compete with ChatGPT [14][17] Summary by Categories Custom Agent Platforms - OpenAI's Apps SDK enables developers to create interactive applications within ChatGPT, enhancing user experience and functionality [12][13] - The introduction of AgentKit allows for easy development of AI agents without extensive coding knowledge, showcasing its efficiency through a live demonstration [13] - Partnerships with various sectors, including education and real estate, highlight the broad applicability of these AI applications [12][14] High Barrier Vertical Applications - The report emphasizes that strong industry know-how, proprietary data, complex workflows, and regulatory compliance create significant barriers to entry for competitors [18][19][20][22] - Companies with deep industry expertise and unique data sources are positioned to leverage large models as tools to enhance their existing advantages rather than being threatened by them [18][19] - Examples include Palantir, which has established a strong foothold in the defense sector through its AI platform [22][23] AI Infrastructure - Infrastructure providers are positioned to gain stable returns by serving all companies involved in the AI arms race, with Snowflake and CrowdStrike highlighted as key players [26][29] - Snowflake's cloud data platform supports scalable AI deployments, while its Cortex suite allows users to run advanced AI models without data migration [28] - CrowdStrike's Falcon platform aims to secure AI operations by protecting against various cyber threats, collaborating with major tech companies to enhance AI security [29][30] Investment Recommendations - The report suggests focusing on companies in the computing sector, particularly those involved in AI infrastructure and agent development, including notable firms like Cambricon, Alibaba, Tencent, and Salesforce [7][34]

Investment Rating - The report maintains a "Buy" rating for several steel companies, including Hualing Steel, Nanjing Steel, Baosteel, and New Steel [8][9][10]. Core Viewpoints - The steel sector has shown a strong performance this year, with a year-to-date increase of over 30%, ranking 7th among Shenwan's primary industries [2]. - The report highlights that the average daily pig iron production has increased to 236.9 thousand tons, while steel production has decreased [11]. - The total inventory of steel has decreased, with a week-on-week decline of 1.7%, indicating a tightening supply [23]. - Apparent steel consumption has shown a slight decline, with a week-on-week decrease of 0.7% [52]. - The report notes that iron ore prices have strengthened, influenced by reduced shipments from Australia and Brazil [49]. Summary by Sections Market Review - The CITIC Steel Index closed at 1,999.70 points, up 0.83%, outperforming the CSI 300 Index by 1.91 percentage points [1][94]. Supply Analysis - Daily pig iron production increased by 2.8 thousand tons, while steel production has decreased, particularly in rebar [11][17]. - The capacity utilization rate for 247 steel mills is reported at 88.8%, reflecting a slight increase [17]. Inventory Analysis - The total inventory of five major steel products decreased to 1,061.4 million tons, down 1.3% week-on-week [25]. - Steel mill inventories also saw a decline, with a 2.9% reduction [25]. Demand Analysis - Apparent consumption of five major steel products decreased by 0.7% week-on-week, with rebar demand dropping more significantly [40][52]. - The average weekly transaction volume for construction steel was 100 thousand tons, reflecting a 3.9% increase [41]. Price and Profitability - The report indicates a slight increase in steel prices, with the Myspic comprehensive steel price index rising to 121.2, up 0.1% week-on-week [75]. - Current costs for long-process rebar and hot-rolled coils are reported at 3,518 yuan/ton and 3,744 yuan/ton, respectively, with negative margins [75][76].

Economic Overview - In October, industrial added value increased by 4.9% year-on-year, down from 6.5% in the previous period[1] - Retail sales grew by 2.9% year-on-year, slightly lower than the previous value of 3.0%[1] - From January to October, fixed asset investment decreased by 1.7%, compared to a decrease of 0.5% previously[1] External Demand - October export growth significantly declined, marking the lowest level since March due to base disturbances and falling export prices[2] - The decline in external demand is exacerbated by the misalignment of new consumer electronics product launches[3] Internal Demand - Real estate investment fell by 14.7% year-on-year, worsening from a previous decline of 13.9%[1] - Infrastructure investment showed a slight increase of 1.5%, down from 3.3% previously, while narrow infrastructure investment fell by 0.1%[1] Investment Trends - Manufacturing investment decreased by 2.7% year-on-year, down from 4.0% previously, with October showing a significant drop of 6.7%[1] - The overall investment landscape indicates a broad decline across real estate, infrastructure, and manufacturing sectors[3] Consumption Patterns - Consumer spending continues to decline, with retail sales growth at 2.9%, marking five consecutive months of decline[5] - The impact of the "trade-in" policy is diminishing, particularly in sectors like home appliances and automobiles[5] Policy Outlook - Achieving the annual GDP growth target of 5% is deemed feasible, with a required growth rate of 4.4% in Q4[4] - Short-term policies are expected to intensify, focusing on accelerating existing measures and preparing for next year's economic layout[4] Employment Situation - The urban survey unemployment rate slightly decreased to 5.1%, down by 0.1 percentage points from the previous value[44] Risks - Potential risks include changes in policy strength, overseas economic conditions, and geopolitical conflicts, which could lead to unexpected outcomes[8]

Report Industry Investment Rating No industry investment rating is provided in the report. Core Viewpoints The report explores investment opportunities in the Hong Kong bond market under the expansion of the "Southbound Connect." It analyzes the market conditions of Chinese dollar-denominated bonds and Dim Sum bonds, and points out potential investment opportunities based on factors such as interest rates, exchange rates, and credit risks [2]. Summary by Directory I. Bond "Southbound Connect" Introduction - Launched on September 24, 2021, it allows domestic investors to invest in bonds traded in the Hong Kong bond market through a connected mechanism [9]. - Initially, it only supported spot bond trading and later gradually introduced repo trading. In 2025, measures were announced to expand trading currencies and extend trading hours [10]. - Regulatory authorities have defined the current participants and trading counterparties. The scope of participants is expected to expand to include non-bank institutions such as securities firms, insurance companies, and asset management companies [11]. II. "Southbound Connect" Investment Target Situation Hong Kong Bond Market Situation - The Hong Kong bond market consists of three main segments: Hong Kong dollar, offshore RMB, and G3 currency markets. As of the end of 2024, the outstanding amounts of Hong Kong dollar bonds, offshore RMB bonds, and G3 currency bonds were 195.5 billion, 173.2 billion, and 565.6 billion US dollars respectively, with G3 currency bonds dominating the market [24]. - From 2015 to 2024, the total size of the Hong Kong bond market showed a significant upward trend, reaching HK$2.83 trillion in 2024. The Exchange Fund and the Hong Kong Special Administrative Region Government are the cornerstones of the market, and overseas issuers and local statutory bodies have also contributed to its growth [26]. Hong Kong Chinese Dollar-Denominated Bond Market Status - Affected by factors such as the US dollar interest rate hike, rising overseas financing costs, and changes in the credit environment, the issuance volume of Chinese dollar-denominated bonds in Hong Kong has declined significantly since 2022, with negative net financing in the past three years [32]. - As of October 30, 2025, the outstanding amount of Chinese dollar-denominated bonds traded on the Hong Kong Stock Exchange and CMU was 361.5 billion US dollars, with 1,180 bonds. They are mainly concentrated in industries such as finance and energy, with coupon rates mostly between 3% - 5% and maturities mostly over 3 years [37][40]. Dim Sum Bond Market Status - The issuance volume and net financing of Dim Sum bonds have increased significantly since 2022, reflecting the promotion of RMB internationalization and the expansion of the "Southbound Connect" [43]. - As of October 29, 2025, the outstanding amount of Dim Sum bonds traded on the Hong Kong Stock Exchange and CMU was 1.5666 trillion RMB, with 1,266 bonds. They are mainly concentrated in industries such as finance, real estate, and consumption, with coupon rates mostly between 3% - 5% and maturities mostly between 1 - 3 years [48][50]. III. Investment Opportunities in Chinese Dollar-Denominated Bonds - The benchmark interest rate for Chinese dollar-denominated bonds is US Treasury bonds. In the first three quarters of 2025, US Treasury bond yields fluctuated and declined in the third quarter. It is expected to remain volatile at a low level in the future [55]. - Investment-grade Chinese dollar-denominated bonds have declined with US Treasury bonds this year, and the spread has narrowed to a low level since 2024. High-yield bonds have fluctuated, and the spread is at a high percentile [57]. - Due to the continuous advancement of debt resolution policies, the spread of overseas Chinese dollar-denominated urban investment bonds has significantly compressed since mid-2024 [59]. - The spread of real estate Chinese dollar-denominated bonds has shown significant differentiation. The spread of investment-grade bonds has continued to compress, while that of non-investment-grade bonds has fluctuated at a high level [63]. - In terms of exchange rates, the US dollar has depreciated against the RMB in 2025, and the narrowing of the discount has reduced the exchange rate hedging cost, increasing the allocation value of Chinese dollar-denominated bonds [66]. - From a credit perspective, the number of defaults or extensions of local state-owned enterprises and central enterprises has decreased, and the investment strategy can focus on bonds of central and state-owned enterprises with large onshore-offshore spreads [67]. IV. Investment Opportunities in Dim Sum Bonds - The benchmark interest rate for Dim Sum bonds is offshore RMB sovereign bonds. This year, Dim Sum bonds have outperformed onshore bonds, and the spread has narrowed to about 50bp [69]. - On the supply side, due to the financing cost advantage and policy support, the issuance of Dim Sum bonds has increased in recent years, and the product structure is expected to become more diverse [71]. - On the demand side, the expansion of the "Southbound Connect" has broadened cross-border investment channels, and the strong demand of domestic institutions for overseas investment is beneficial to the secondary market performance of Dim Sum bonds. Some Dim Sum bonds still have relatively high spreads compared to onshore bonds, offering good value [71].

Investment Rating - The report maintains a "Buy" rating for the company [5] Core Views - The company reported a total revenue of 4.63 billion yuan for the first three quarters of 2025, representing a year-on-year growth of 11.82%. The net profit attributable to shareholders was 800 million yuan, up 12.66% year-on-year [1] - The company expects a full-year revenue growth of 13%-15%, driven by the ramp-up of emerging businesses and improved client delivery schedules [1] - Emerging businesses, including peptides, oligonucleotides, and ADCs, showed significant growth, with a 71.87% increase in revenue year-on-year for the first three quarters [2] Summary by Sections Financial Performance - For Q3 2025, the company achieved a revenue of 1.44 billion yuan, a slight decrease of 0.09% year-on-year, and a net profit of 183 million yuan, down 13.46% year-on-year [1] - The net cash flow from operating activities for the first three quarters was 1.144 billion yuan, an increase of 8.67% year-on-year [1] Business Segments - Small molecule business revenue remained stable with a gross margin of 46.99% [2] - Emerging businesses (including peptides, oligonucleotides, ADCs) saw a revenue increase of 71.87% with a gross margin of 30.55%, up 10.57 percentage points year-on-year [2] - The chemical macromolecule business experienced over 150% revenue growth, marking it as the fastest-growing segment [2] Customer Structure - Revenue from large pharmaceutical companies was 2.053 billion yuan, a year-on-year increase of 1.98%, while revenue from small and medium-sized pharmaceutical companies reached 2.577 billion yuan, up 21.14% year-on-year [3] - The company is actively expanding its diversified customer base to enhance business resilience [3] Profit Forecast and Investment Advice - The company’s projected net profits for 2025-2027 are 1.186 billion yuan, 1.324 billion yuan, and 1.568 billion yuan, with growth rates of 25.0%, 11.6%, and 18.5% respectively [3]

Report Industry Investment Rating No relevant content provided. Core Viewpoints - Credit demand is generally weak, and the loan growth rate is expected to continue to slow. The bond market will maintain a volatile recovery trend, and the 10-year Treasury bond rate (old active bond) is expected to recover to the pre-adjustment level of 1.6%-1.65% by the end of the year [1][6]. Summaries by Related Catalogs Credit Situation - In October, the new credit was 22 billion yuan, a year-on-year decrease of 28 billion yuan, and the new credit scale has decreased year-on-year for four consecutive months. Except for bill financing, the new scale of medium and long-term loans for residents and enterprises decreased year-on-year to varying degrees, and short-term corporate loans were the same as the previous value [1][9]. - In terms of corporate credit, the new corporate credit in October was 35 billion yuan, a year-on-year increase of 22 billion yuan, mainly due to bill financing. The new medium and long-term corporate loans were 3 billion yuan, a year-on-year decrease of 14 billion yuan; short-term corporate loans were -19 billion yuan, the same as the previous year; bill financing was 50.06 billion yuan, a year-on-year increase of 33.12 billion yuan [2][9]. - In terms of household loans, the new household loans in October were -36.04 billion yuan, a year-on-year increase of 52.04 billion yuan in reduction. The new medium and long-term household loans were -7 billion yuan, a year-on-year increase of 18 billion yuan in reduction; short-term household loans were -28.66 billion yuan, a year-on-year increase of 33.56 billion yuan in reduction. Short-term loans have decreased year-on-year for four consecutive months, and real estate sales have continued to decline since mid-October, indicating weak social terminal demand [2][9]. Social Financing Situation - The growth rate of social financing further declined. In October, the new social financing was 81.49 billion yuan, a year-on-year decrease of 59.71 billion yuan. The year-on-year growth rate of social financing stock was 8.5%, 0.2 percentage points lower than the previous month. The issuance of government bonds was stable, with a new scale of 48.93 billion yuan, a month-on-month decrease of 70 billion yuan and a year-on-year decrease of 56.02 billion yuan [3][13]. - Assuming that 1 trillion yuan of next year's issuance quota is issued in the fourth quarter of this year, it is estimated that government bonds from November to December will still decrease year-on-year. By the end of the year, the social financing growth rate may drop to about 8.3% [3][13]. Money Supply Situation - In October, the year-on-year growth rate of M1 dropped from 7.2% to 6.2%, partly due to the base effect and partly related to the outflow of household deposits. The two-year compound growth rate of M1 in October was 1.85%, basically the same as the previous value. The year-on-year growth rate of M2 was 8.2%, 0.2 percentage points lower than the previous month [4][17]. Deposit and Loan Situation - In October, new deposits were 61 billion yuan, a year-on-year increase of 1 billion yuan. The stock index broke through 4,000 points on October 29, and household and corporate deposits may have flowed to non-bank institutions. Household deposits decreased by 1.34 trillion yuan, a year-on-year increase of 770 billion yuan in reduction; corporate deposits decreased by 1.09 trillion yuan, a year-on-year increase of 355.3 billion yuan in reduction; non-bank deposits increased by 1.85 trillion yuan, a year-on-year increase of 770 billion yuan [5][19]. - The overall deposit growth rate in October was 8.0% year-on-year, the same as the previous month, while the loan growth rate dropped slightly by 0.1 percentage points to 6.5%. The gap between deposit and loan growth rates widened to 1.5 percentage points, indicating a continued asset shortage [5][19]. Bond Market Situation - The broad-spectrum interest rate continued to decline, and the bond market continued to recover in a volatile manner. The year-on-year growth rates of social financing, M1, and M2 all declined in October, and household credit decreased, indicating a weak recovery in the current fundamentals. The bond market is expected to maintain a volatile recovery trend, and the interest rate is expected to decline more smoothly in the second half of the fourth quarter [6][21].