Investment Rating - The report maintains a positive outlook on the formulation sector's performance and valuation recovery opportunities due to the optimization of centralized procurement [14][18]. Core Viewpoints - The current valuation of the pharmaceutical sector is at a low point, with public funds (excluding pharmaceutical funds) having low allocation to this sector. Considering the positive recovery of macroeconomic factors such as US Treasury rates, the report remains optimistic about the growth of the pharmaceutical industry by 2025, expecting a variety of investment opportunities to emerge [11][12]. - The report highlights the impact of the tenth batch of national procurement, which is expected to have an average price drop of 75%, causing significant market sentiment disturbances. This is attributed to an increase in the number of bidding companies and changes in procurement rules [16][14]. - The report emphasizes the ongoing recovery in the medical device sector, particularly in imaging equipment and home medical devices, and suggests focusing on companies like Mindray and Yuyue [11]. Summary by Sections Market Review - The CITIC Pharmaceutical Index rose by 2.21%, outperforming the CSI 300 Index by 3.30 percentage points, ranking third among 30 primary industries [8]. - The top ten stocks by increase included Shutaishen, Huasan Pharmaceutical, and Changshan Pharmaceutical, while the top ten stocks by decrease included ST Xiangxue and Hai Sheng Pharmaceutical [8]. Overall View and Investment Themes - The report suggests a shift from quantity logic to quality logic in the domestic innovative drug sector, recommending a focus on differentiated and internationalized pipelines that can deliver profits by 2025 [11]. - In the medical device sector, there is a notable recovery in bidding volumes for imaging equipment, and the home medical device market is supported by subsidy policies [11]. - The report identifies a potential growth cycle in the specialty raw materials pharmaceutical industry, which is currently at a near ten-year low in valuation [11]. Traditional Chinese Medicine - The report anticipates a rebound in the market for essential medicines, with a focus on companies like Kunming Pharmaceutical and Kangyuan Pharmaceutical, as the growth rate of exclusive essential medicines is expected to significantly exceed that of non-essential medicines [13]. Pharmacy Sector - The report expresses confidence in the pharmacy sector's investment opportunities, driven by prescription outflow and market optimization, with a recommendation to focus on companies like YaoBaiYao and YiFeng Pharmacy [13]. Medical Services - The report notes that anti-corruption measures and centralized procurement are expected to enhance the competitive environment in the private medical sector, with recommendations for companies like Huashan Eye Hospital and Aier Eye Hospital [13]. Blood Products - The report indicates a favorable long-term growth path for the blood products industry, with companies like Tiantan Biological and Boya Biological expected to benefit from increased supply and demand elasticity post-pandemic [13].

Quantitative Models and Construction - **Model Name**: Volume Model **Construction Idea**: This model evaluates market sentiment and liquidity by analyzing trading volume trends[12][69] **Evaluation**: The model currently signals a neutral stance for the short term[12][69] - **Model Name**: Low Volatility Model **Construction Idea**: This model focuses on identifying periods of low market volatility to predict potential market movements[12][69] **Evaluation**: The model currently signals a neutral stance for the short term[12][69] - **Model Name**: Institutional Feature Model (Top Trader Board) **Construction Idea**: This model leverages institutional trading patterns and top trader board data to assess market sentiment[12][69] **Evaluation**: The model currently signals a neutral stance for the short term[12][69] - **Model Name**: Feature Volume Model **Construction Idea**: This model analyzes specific volume features to predict market trends[12][69] **Evaluation**: The model currently signals a bearish stance for the short term[12][69] - **Model Name**: Smart Index Models (CSI 300 and CSI 500) **Construction Idea**: These models use machine learning algorithms to analyze the CSI 300 and CSI 500 indices for predictive insights[12][69] **Evaluation**: The CSI 300 model signals neutrality, while the CSI 500 model signals a bullish stance for the short term[12][69] - **Model Name**: Limit-Up/Limit-Down Model **Construction Idea**: This model evaluates the frequency and distribution of limit-up and limit-down events to gauge market momentum[13][70] **Evaluation**: The model signals a bullish stance for the mid-term[13][70] - **Model Name**: Calendar Effect Model **Construction Idea**: This model incorporates seasonal and calendar-based patterns to predict market movements[13][70] **Evaluation**: The model signals a neutral stance for the mid-term[13][70] - **Model Name**: Long-Term Momentum Model **Construction Idea**: This model identifies long-term trends in market momentum across broad-based indices[14][71] **Evaluation**: The model signals neutrality for all broad-based indices in the long term[14][71] - **Model Name**: A-Share Comprehensive Weapon V3 Model **Construction Idea**: This composite model integrates multiple short, mid, and long-term signals to provide an overall market outlook[15][72] **Evaluation**: The model signals a bearish stance for the A-share market[15][72] - **Model Name**: A-Share Comprehensive National Index 2000 Model **Construction Idea**: This model focuses on the National Index 2000, combining various signals for a comprehensive analysis[15][72] **Evaluation**: The model signals a neutral stance for the A-share market[15][72] - **Model Name**: Hong Kong Market Turnover-to-Volatility Model **Construction Idea**: This model evaluates the Hong Kong market by analyzing the ratio of turnover to volatility[16][73] **Evaluation**: The model signals a bullish stance for the mid-term[16][73] Model Backtesting Results - **Volume Model**: Neutral signal, no specific backtesting results provided[12][69] - **Low Volatility Model**: Neutral signal, no specific backtesting results provided[12][69] - **Institutional Feature Model**: Neutral signal, no specific backtesting results provided[12][69] - **Feature Volume Model**: Bearish signal, no specific backtesting results provided[12][69] - **Smart Index Models**: CSI 300 (Neutral), CSI 500 (Bullish), no specific backtesting results provided[12][69] - **Limit-Up/Limit-Down Model**: Bullish signal, no specific backtesting results provided[13][70] - **Calendar Effect Model**: Neutral signal, no specific backtesting results provided[13][70] - **Long-Term Momentum Model**: Neutral signal, no specific backtesting results provided[14][71] - **A-Share Comprehensive Weapon V3 Model**: Bearish signal, no specific backtesting results provided[15][72] - **A-Share Comprehensive National Index 2000 Model**: Neutral signal, no specific backtesting results provided[15][72] - **Hong Kong Market Turnover-to-Volatility Model**: Bullish signal, no specific backtesting results provided[16][73]

Group 1: PMI Data Overview - The manufacturing PMI for May is 49.5%, up from 49.0% in the previous month[2] - The production index increased to 50.7%, a rise of 0.9 percentage points from 49.8%[2] - The new orders index is at 49.8%, up from 49.2%[2] - The new export orders index improved to 47.5%, compared to 44.7% previously[2] - The employment index stands at 48.1%, slightly up from 47.9%[2] Group 2: Export Dynamics - The new export orders index of 47.5% is lower than the average of 48% in Q1 2025 and 47.9% in Q4 2024[3] - The procurement index is at 47.6%, up from 46.3%, but below the average of 50.8% from October 2024 to March 2025[3] - The production index of 50.7% is below the average of 51.9% for the same period[3] - The factory price index remains low at 44.7%, slightly down from 44.8%[3] Group 3: U.S. Import Trends - U.S. import growth averaged 25.7% from January to March 2025, but dropped to 2.6% in April[4] - The U.S. import orders index averaged 51.3% in Q1 2025, falling to 47.1% in April[4] - U.S. import container volumes in May showed a year-on-year decline compared to April[4]

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - In May 2025, the temporary easing of China-US trade negotiations led to the release of previously postponed production demand, driving the PMI to rise. However, there is still uncertainty about the tariff outlook, and the recovery of new orders is relatively slow. The domestic off - season effect is becoming more prominent, and the contribution of domestic demand to new order growth has decreased compared to April [3][9]. - For the bond market, the fundamental conditions still provide support. Considering the historical experience of trade frictions from 2018 - 2019, there may be fluctuations in subsequent tariff policy negotiations. The uncertainty of external conditions may affect expectations, production, and inventory - stocking intentions and rhythms. The "rush - to - export" elasticity in May is not significantly higher than that in April, and the year - on - year increase in May's exports may be lower than expected. In the traditional off - season, the potential for unexpected growth in domestic demand in May is limited, so the bond market is still supported. Attention should be paid to the data verification in June and potential "expectation gaps" [3][41]. 3. Summary by Directory 3.1 Manufacturing PMI: External Disturbances Ease, PMI Moderately Recovers 3.1.1 Supply and Demand: Tariff Disturbances Ease, Production Accelerates Recovery - In May, production increased by 0.9 pct month - on - month to 50.7%, returning to the expansion range. The easing of Sino - US economic and trade negotiations in mid - May slowed the decline in exports, and the demand for existing foreign trade orders was released in an orderly manner, accelerating the production and procurement rhythms compared to April. The procurement volume index increased by 1.3 pct month - on - month to 47.6%, and imports increased by 3.7 pct month - on - month to 47.1%, with the decline significantly narrowing [16]. - Demand stabilized in May, and new orders improved moderately. New orders increased by 0.6 pct month - on - month to 49.8% but remained in the contraction range. After the easing of trade negotiations, export orders recovered marginally, reducing the contraction of new orders. However, the difference between "new orders - new export orders" narrowed, and domestic demand orders decreased due to the off - season, which may limit the recovery of new orders [19]. 3.1.2 Foreign Trade: Negotiations Ease, New Export Orders are Concentratedly Released - In May, the easing of tariff negotiations led to the release of overseas order increments. New export orders and imports increased by 2.8 pct and 3.7 pct month - on - month to 47.5% and 47.1% respectively, with their elasticity restored. Combining the month - on - month changes in April and May, both were better than the same period in previous years, indicating a wider improvement in the foreign trade prosperity of manufacturing enterprises in May [26]. 3.1.3 Price: External Disturbances Narrow, Price Decline Slows - In May, the impact of the traditional off - season became more evident, and the prices of upstream bulk commodities remained weak, causing prices to decline slightly. The purchase price of raw materials and the ex - factory price both decreased by 0.1 pct month - on - month to 46.9% and 44.7% respectively. Although the price continued to weaken marginally, the narrowing of external disturbances slowed the price decline [31]. 3.1.4 Inventory: Increased Procurement Boosts Raw Material Replenishment, and Products are Rapidly De - stocked - In May, with the acceleration of procurement, raw material inventories increased, and downstream de - stocking accelerated. The easing of the negotiation situation accelerated the shipment of downstream exports, and finished product inventories decreased by 0.8 pct month - on - month to 46.5%. As the production rhythm recovered, the material procurement volume increased month - on - month, and raw material inventories increased by 0.4 pct month - on - month to 47.4% [35]. 3.2 Non - manufacturing PMI: The Drag of Real Estate Construction May Continue to Expand, and the Service Industry during the Holiday Season Shows Many Highlights - In May, the non - manufacturing PMI was 50.3%, a month - on - month decrease of 0.1 pct. Among them, the service industry PMI increased by 0.1 pct month - on - month to 50.2%, and the construction industry PMI decreased by 0.9 pct month - on - month to 51.0%, with the expansion continuing to slow due to the drag of real estate construction demand [36]. 3.2.1 Construction Industry - In May, the construction industry PMI continued to decline, while infrastructure demand further strengthened. The new export orders of civil engineering construction rose above 60%, significantly driving the industry PMI to climb for two consecutive months and reach above 62%. The easing of trade negotiations boosted the acceleration of overseas infrastructure investment to some extent. However, the overall construction industry PMI continued to decline, indicating that the activity rhythm of the housing construction industry may have further contracted in May [2][36]. 3.2.2 Service Industry - Holiday consumption boosted the improvement of the service industry PMI. In May, the expansion of the service industry PMI accelerated slightly. The production and new order indices of the information service industry maintained strong expansion. The release of consumption demand during the May Day holiday significantly increased the month - on - month PMI of railway, air, and water transportation industries. The accommodation and catering industries rose above the boom - bust line, ending three consecutive months of contraction [2][36].

Investment Rating - The report gives a "Buy" rating for the company, with a target price of 98 CNY based on a 40x valuation for 2025 [3][11]. Core Insights - The company is a pioneer in the ophthalmic device sector, focusing on intraocular lenses, orthokeratology lenses, and contact lenses, and is strategically expanding its product matrix to cover the entire eye health lifecycle [7][15]. - The company has demonstrated strong R&D capabilities, achieving key technological breakthroughs in various fields, particularly in multi-focal intraocular lenses, which have disrupted the import monopoly [7][15]. - The report highlights the company's robust growth trajectory, with projected revenue growth from 1.41 billion CNY in 2024 to 2.79 billion CNY by 2027, reflecting a compound annual growth rate (CAGR) of 48.2% [3][11]. Summary by Sections Section 1: Company Overview - The company was established in 2010 and has a strong R&D foundation, with a focus on innovative ophthalmic devices [15]. - It has successfully commercialized products in surgical treatment, myopia prevention, and vision care, making it one of the few companies in China to achieve this across multiple categories [15]. Section 2: Intraocular Lenses - The company is a leading domestic player in the intraocular lens market, focusing on the mid-to-high-end segments [9][36]. - It has introduced innovative products such as the first domestic toric intraocular lens and the first multi-focal intraocular lens, which have performed well in national procurement [9][36]. - The report anticipates a significant increase in demand for cataract surgeries due to an aging population, projecting the number of surgeries to rise to 7 million by 2030 [38]. Section 3: Orthokeratology Lenses - The company’s orthokeratology lenses are positioned in the first tier of product performance, with a focus on myopia prevention [10]. - The market for these lenses is expected to grow rapidly, supported by increasing recognition in myopia prevention guidelines [10]. Section 4: Contact Lenses - The company is leveraging its strong foundational technology from intraocular lenses to expand into the high-end and consumer segments of the contact lens market [10]. - Recent acquisitions have enhanced its capabilities in colored contact lenses and expanded its retail channels [10]. Section 5: Financial Projections and Valuation - The company is expected to achieve net profits of 4.7 billion CNY, 5.9 billion CNY, and 7.1 billion CNY for the years 2025 to 2027, respectively, with corresponding earnings per share (EPS) of 2.45 CNY, 3.03 CNY, and 3.69 CNY [3][11]. - The report emphasizes the potential for recovery in profit margins as the impact of national procurement pricing on intraocular lenses diminishes and as the contact lens business matures [21][22].

Investment Rating - The industry investment rating is "Recommended" indicating an expectation that the industry index will rise more than 5% compared to the benchmark index in the next 3-6 months [39]. Core Insights - The report focuses on the high-quality development of the public fund industry in China and emphasizes the importance of "beating the benchmark" as a core mission for active management. It specifically explores investment strategies for Hong Kong non-A+H financial stocks to help investors achieve excess returns [2][27]. - The report identifies several non-A+H financial stocks in Hong Kong that have historically generated strong alpha, providing insights into potential investment opportunities [2][8]. Summary by Sections 1. Overview of Hong Kong Non-A+H Financial Stocks - The report provides an overview of the holdings of active equity funds in Hong Kong non-A+H financial stocks, with a weighted average benchmark comprising 53% CSI 300, 24% CSI 800, and others, indicating a significant allocation to Hong Kong stocks [3][4]. 2. Historical Performance of Non-A+H Financial Stocks - The Hong Kong non-A+H financial index shows a higher dividend yield of 4.53% compared to 2.06% for the A-share non-financial index, suggesting a more attractive income profile for investors [7][8]. - The report highlights that 44 stocks exhibited excess returns in 2025, with notable performers including 易鑫集团 (Easy Finance) with a 112.7% return and 香港交易所 (Hong Kong Stock Exchange) with a 20.3% return [9][11]. 3. Performance Analysis by Year - In 2024, 61 stocks achieved excess returns, with 国泰君安国际 (Guotai Junan International) leading at 78.6% [14][15]. - In 2023, 81 stocks showed excess returns, with OSL Group achieving a remarkable 304.2% return, benefiting from the rise in cryptocurrency asset prices [19][25]. 4. Recommendations - The report recommends focusing on non-A+H financial stocks that have stable earnings or improving fundamentals, specifically highlighting 中国财险 (China Pacific Insurance) and 香港交易所 (Hong Kong Stock Exchange) as long-term outperformers [27].

Investment Rating - The report assigns a strong buy rating for NVIDIA, expecting it to outperform the benchmark index by over 20% in the next six months [36]. Core Insights - NVIDIA reported FY26Q1 revenue of $44.1 billion, a year-over-year increase of 69% and a quarter-over-quarter increase of 12%, significantly exceeding market expectations of $43.3 billion and company guidance of $43 billion ± 2% [3][7]. - The data center business continues to drive growth, with Q1 data center revenue reaching $39.1 billion, up 73% year-over-year and 10% quarter-over-quarter, with Blackwell contributing 70% of data center computing revenue [3][4]. - The company anticipates FY26Q2 revenue to be around $45 billion, considering an estimated loss of $8 billion in H20 revenue due to recent export control restrictions [5][8]. Revenue Breakdown - **Data Center**: FY26Q1 revenue reached a record high of $39.1 billion, with computing revenue at $34.2 billion (up 76% YoY) and networking revenue at $4.957 billion (up 56% YoY) [4]. - **Gaming**: FY26Q1 revenue was $3.763 billion, reflecting a 42% YoY increase and a 48% QoQ increase, driven by strong adoption of Blackwell architecture GPUs [4]. - **Professional Visualization**: FY26Q1 revenue was $509 million, showing a 19% YoY increase, with expectations for recovery in Q2 [4]. - **Automotive and Robotics**: FY26Q1 revenue was $567 million, up 72% YoY, driven by strong demand for autonomous driving and electric vehicles [4]. Profitability Metrics - The GAAP and non-GAAP gross margins for the quarter were 60.5% and 61.0%, respectively. Excluding a $4.5 billion expense, the non-GAAP gross margin would have reached 71.3% [3][7]. - GAAP and non-GAAP diluted earnings per share were $0.76 and $0.81, respectively. Adjusting for the $4.5 billion expense, the non-GAAP diluted EPS would have been $0.96 [3][7]. Future Outlook - The company aims to improve gross margins to the mid-70% range in the second half of the year, with FY26Q2 gross margin guidance set at 71.8% and 72.0% for GAAP and non-GAAP, respectively [5][8]. - NVIDIA is experiencing a significant increase in demand for AI applications, with expectations for AI spending to reach nearly $1 trillion in the coming years [12][17].

Investment Rating - The industry investment rating is "Recommended," indicating an expected increase in the industry index by more than 5% over the next 3-6 months compared to the benchmark index [37]. Core Insights - NVIDIA reported FY26Q1 revenue of $44.1 billion, a year-over-year increase of 69% and a quarter-over-quarter increase of 12%, significantly exceeding market expectations of $43.3 billion and company guidance of $43.0±2 billion. This growth was primarily driven by the data center business, which generated $39.1 billion in revenue, up 73% year-over-year and 10% quarter-over-quarter [3][7]. - The Blackwell architecture contributed approximately 70% of the data center computing revenue, marking the fastest ramp-up in GPU production in the company's history [4]. - The company expects FY26Q2 revenue to be $45.0 billion, with a potential loss of $8.0 billion in revenue due to recent export control restrictions affecting the H20 product line [5][8]. Summary by Sections 1. Performance Overview - FY26Q1 revenue reached $44.1 billion, with data center revenue at $39.1 billion, reflecting a 73% year-over-year growth. The GAAP and non-GAAP gross margins were 60.5% and 61.0%, respectively. Excluding a $4.5 billion expense, the non-GAAP gross margin would have been 71.3% [3][7]. - The diluted earnings per share were $0.76 (GAAP) and $0.81 (non-GAAP), with a potential adjusted non-GAAP EPS of $0.96 when excluding the aforementioned expense [3][7]. 2. Business Segment Performance - **Data Center**: Revenue reached a record high of $39.1 billion, with computing revenue at $34.2 billion (up 76% YoY) and networking revenue at $4.957 billion (up 56% YoY) [4]. - **Gaming**: Revenue was $3.763 billion, showing a 42% year-over-year increase, driven by strong adoption of Blackwell architecture GPUs [4]. - **Professional Visualization**: Revenue was $509 million, with a 19% year-over-year increase, although it remained flat quarter-over-quarter due to tariff-related uncertainties [4]. - **Automotive and Robotics**: Revenue was $567 million, reflecting a 72% year-over-year increase, driven by strong demand for autonomous driving and electric vehicles [4]. 3. Future Guidance - The company anticipates FY26Q2 revenue of $45.0 billion, accounting for an estimated $8.0 billion loss in H20 revenue due to export restrictions. Expected gross margins are projected at 71.8% (GAAP) and 72.0% (non-GAAP) [5][8].

Investment Rating - The report maintains a "Recommendation" rating for the company, with a target price of 52.93 yuan [1][7]. Core Views - The company reported a revenue of 64.36 million yuan in Q1 2025, a year-on-year increase of 2.59%, while the net profit attributable to shareholders was -83.58 million yuan [1]. - The company experienced a significant decline in revenue in 2024, with a total of 371 million yuan, down 24.31% year-on-year, and a net profit of -343 million yuan [1][7]. - The report highlights improvements in operational efficiency and cash flow, with a notable 47% year-on-year improvement in net cash flow from operating activities in Q1 2025 [7]. - The company is in a phase of technological investment and market expansion, with initial breakthroughs in its large model business, securing nearly 50 million yuan in orders across various sectors [7]. Financial Summary - For 2024, the total revenue is projected at 371 million yuan, with a year-on-year growth rate of -24.3%. The expected revenue for 2025 is 427 million yuan, reflecting a growth rate of 15% [3]. - The net profit attributable to shareholders is forecasted to improve from -343 million yuan in 2024 to -238 million yuan in 2025, indicating a reduction in losses by 30.7% [3]. - The earnings per share (EPS) is expected to improve from -2.84 yuan in 2024 to -1.96 yuan in 2025 [3].

Investment Rating - The report gives a "Buy" rating for the company, with a target price of 98 CNY based on a DCF model evaluation [2][10]. Core Insights - The company is a pioneer in the ophthalmic device sector, focusing on intraocular lenses, orthokeratology lenses, and contact lenses, and is strategically expanding its product matrix [6][14]. - The company has established itself as a leading domestic player in the intraocular lens market, with a strong product lineup and favorable bidding results in national procurement [8][46]. - The report highlights the increasing demand for cataract surgeries due to an aging population, which is expected to drive growth in the intraocular lens market [36][41]. Summary by Sections Company Overview - The company was founded in 2010 and has a strong R&D capability, achieving key technological breakthroughs in various fields, including multifocal intraocular lenses, thus breaking the import monopoly [6][14]. - The company has a diversified product matrix, focusing on intraocular lenses, orthokeratology lenses, and contact lenses, and aims to cover the entire lifecycle of eye health products [14][26]. Intraocular Lenses - The company is a domestic leader in intraocular lenses, with a comprehensive product system and good performance in national procurement [8][35]. - The report notes that cataract surgeries are the most direct and effective treatment for cataracts, which are prevalent among the elderly population [35][36]. - The company has successfully introduced innovative products, including the first domestic toric intraocular lens and a dual-focus intraocular lens, which has been well-received in national procurement [8][46]. Orthokeratology Lenses - The company’s orthokeratology lenses are positioned in the first tier of product performance, with ongoing efforts to expand the myopia prevention industry chain [9][20]. - The increasing prevalence of myopia among children and adolescents is driving demand for orthokeratology lenses, which have been recognized in national guidelines [9][20]. Contact Lenses - The company has a solid technological foundation for contact lenses, aiming to penetrate both high-end and consumer markets [9][20]. - Recent acquisitions have accelerated the development of the contact lens business, with plans to focus on high-end silicone hydrogel contact lenses and soft contact lenses for consumer markets [9][20]. Financial Projections - The company is expected to achieve net profits of 4.7 billion CNY, 5.9 billion CNY, and 7.1 billion CNY for the years 2025 to 2027, with corresponding EPS of 2.45 CNY, 3.03 CNY, and 3.69 CNY [2][10]. - The report anticipates a gradual recovery in profit margins as the impact of national procurement pricing on intraocular lenses diminishes and the contact lens business stabilizes [20][10]. Market Potential - The report projects that the intraocular lens market in China could reach 100 billion CNY by 2030, driven by increasing surgical demand and the ongoing shift towards domestic products [41][42]. - The company is well-positioned to benefit from the growing market share of domestic brands in the intraocular lens sector, which is expected to continue rising due to national procurement policies [42][46].