Investment Rating - The report gives a "Buy" rating for Nanjing Securities with a target price of 9.45 RMB [1][6]. Core Views - Nanjing Securities, as a state-owned broker in Nanjing, leverages its local government background to enhance resource collaboration and has a stable shareholding structure [6][7]. - The company's return on equity (ROE) is currently below the industry average but shows potential for improvement due to increasing leverage and a favorable debt structure [8][29]. - The business layout is dominated by capital-intensive operations, with a significant portion of revenue coming from proprietary trading, which aligns well with industry trends [6][10]. Financial Summary - Total revenue is projected to grow from 3,147 million RMB in 2024 to 3,894 million RMB in 2027, with a compound annual growth rate (CAGR) of approximately 7% [2]. - Net profit attributable to shareholders is expected to increase from 1,002 million RMB in 2024 to 1,462 million RMB in 2027, reflecting a CAGR of about 7% [2]. - Earnings per share (EPS) is forecasted to rise from 0.27 RMB in 2024 to 0.40 RMB in 2027 [2]. Business Performance - The company has a high reliance on capital-intensive business, with an average revenue contribution of 69.1% from such operations from 2022 to 2024, significantly above the industry average of 49% [6][21]. - The brokerage business is transitioning towards wealth management, with expected net income from this segment to reach 7.78 million RMB in 2025 [9]. - Investment banking revenue is projected to decline slightly, with net income expected to be 1.67 million RMB in 2025 [9]. Leverage and Profitability - The financial leverage of Nanjing Securities has increased from 2.51X in 2022 to 3.76X in 2025, narrowing the gap with industry averages [8][38]. - The company's annualized ROE for the first three quarters of 2025 is reported at 6.8%, which is 1.8 percentage points lower than the industry average, indicating room for improvement [29][38]. Valuation and Investment Recommendation - The report suggests a price-to-book (PB) ratio of 1.8 for the year 2026, leading to a target price of 9.45 RMB based on the expected performance and capital strength post-equity financing [10][8]. - The anticipated capital increase of 5 billion RMB is expected to significantly enhance the company's capital strength and support business development [8][10].

Group 1: Monetary Policy Insights - The central bank's statement of "strong supply, weak demand" aligns with previous economic work meetings, indicating potential restrictions on loans for production sectors[2] - The emphasis on "optimizing supply, improving increment, and revitalizing stock" suggests limited credit growth for real estate and local financing platforms, while financing for high-tech innovative enterprises may continue to expand[2] - The central bank's focus on the timing of policy implementation indicates that if fiscal debt issuance accelerates, monetary easing may be coordinated, but if fiscal pressure is low, the focus may shift to structural adjustments[2] Group 2: Economic Outlook and Market Implications - The report maintains the view that loan growth and M2 growth are likely to decline, suggesting that the period of maximum macro liquidity may have passed, making further valuation increases challenging[2] - For equity assets, the supply-demand balance is improving, and the stock-bond Sharpe ratio indicates a preference for stocks, although valuation pressures are expected to increase[3] - The ten-year government bond yield may face upward pressure if monetary policy does not signal unconventional easing, with ongoing economic cycles and market risk preferences influencing this[3] Group 3: Risks and Considerations - The removal of the phrase "preventing fund circulation" suggests that the central bank may have more flexibility to adjust monetary policy in response to significant economic downturns[2] - The central bank's focus on optimizing the structure of credit may lead to a decrease in loans for traditional sectors, impacting overall economic dynamics[5] - The anticipated marginal increase in fiscal debt in 2026 compared to 2025 may limit the scope for aggressive monetary policy adjustments[9]

Investment Rating - The report upgrades the investment rating of Haiguang Information (688041) to "Strong Buy" with a target price of 336 CNY [2]. Core Insights - Haiguang Information has launched an open platform strategy to build a unified ecosystem for domestic computing power, focusing on AI computing architecture [2]. - The company aims to transition from a chip manufacturer to a platform-based core hub for domestic computing power, leveraging its "DCU + CPU" dual-core strategy and open software stack [9]. - The newly released HSL 1.0 interconnection specification is a significant step towards standardizing and scaling domestic computing power, facilitating integration with various AI chips [9]. - The company is developing a "Chinese version of CUDA" to lower application migration costs, enhancing ecosystem stickiness and accelerating the deployment of domestic AI applications [9]. Financial Summary - Total revenue projections for Haiguang Information are 9,162 million CNY in 2024, increasing to 26,327 million CNY by 2027, reflecting a compound annual growth rate (CAGR) of 52.4% to 35.0% [5]. - Net profit attributable to shareholders is expected to grow from 1,931 million CNY in 2024 to 6,583 million CNY in 2027, with growth rates of 52.9% to 35.9% [5]. - Earnings per share (EPS) are projected to rise from 0.83 CNY in 2024 to 2.83 CNY in 2027, indicating strong profitability growth [5]. - The price-to-earnings (P/E) ratio is expected to decrease from 264 in 2024 to 78 in 2027, suggesting improving valuation metrics as the company grows [5].

Investment Rating - The report maintains a "Recommended" investment rating for the computing chip industry, particularly focusing on domestic GPU manufacturers [2]. Core Insights - The report emphasizes that the development of large models follows the "Scaling Law," indicating a rigid expansion of computing power demand. This is supported by quantifiable data on AI application deployment and computing consumption, establishing a commercial link where "computing power is production material" [6]. - The GPU industry is characterized by a concentrated market structure, with major players like NVIDIA dominating the landscape. The report highlights the ongoing strategic partnerships between cloud giants and NVIDIA, reinforcing the latter's core position in AI infrastructure [6][7]. - The report analyzes the domestic GPU manufacturers' response to U.S. export restrictions, detailing their technological advancements and market strategies. Companies like Cambricon, Haiguang Information, Moore Threads, and Muxi are highlighted for their efforts to catch up with international standards [6][7]. Summary by Sections 1. GPU's Role in AI - GPUs excel in parallel computing, making them suitable for AI acceleration. The architecture of GPUs allows for simultaneous processing of vast amounts of data, significantly reducing training times for AI models [11][12]. - The GPU industry value chain is primarily concentrated in the midstream, where AI chip demand drives market growth. The report notes that the global GPU market is expected to reach 1,051.54 billion yuan by 2024, with a significant portion attributed to AI computing GPUs [24][29]. 2. Global AI Investment Trends - Major global tech companies are increasing their investments in AI, with NVIDIA maintaining a dominant position. The report cites that NVIDIA holds a 98% market share in the data center GPU segment, underscoring its competitive edge [21][35]. - The report indicates that the AI investment cycle is achieving a closed loop, with companies like Google and Microsoft ramping up their capital expenditures significantly to support AI infrastructure [46][50]. 3. Domestic GPU Development - The report discusses the urgency for domestic GPU manufacturers to achieve self-sufficiency in light of U.S. export controls. Companies are making strides in product development and market entry, with varying degrees of commercial success [6][7]. - The report highlights the financial trajectories of domestic firms, noting that Haiguang Information achieved profitability in 2021, while Cambricon is expected to reach profitability by Q4 2024 [6][7]. 4. Market Projections - The report forecasts that the global GPU market will grow to 3,611.97 billion yuan by 2029, with China's share increasing from 15.6% in 2024 to 37.8% by 2029. AI computing GPUs are projected to be the core growth driver [24][29]. - The report anticipates that the demand for data center GPUs will continue to surge, with a projected market size of 663.92 billion yuan by 2029, reflecting a compound annual growth rate of 70.1% [29][31].

Investment Rating - The report maintains a "Recommendation" rating for the food and beverage industry, expecting the industry index to outperform the benchmark index by over 5% in the next 3-6 months [24]. Core Insights - The Ministry of Commerce has announced a countervailing policy against EU dairy imports, which is expected to accelerate domestic product substitution and stabilize raw milk prices. The policy will impose temporary countervailing measures on EU dairy products starting December 23, 2025, with subsidy rates ranging from 21.9% to 42.7% [2][8]. - The policy targets high-fat dairy products, particularly cheese and cream, which have a high dependency on imports. This is expected to significantly increase the cost of EU products, thereby enhancing the price advantage for domestic manufacturers [8]. - The domestic dairy processing industry has historically relied on imports due to high raw milk costs and immature technology. The report estimates that the domestic production of similar products accounted for only 14%-18% in 2023, indicating a substantial market opportunity for local producers [8]. Summary by Sections Industry Overview - The food and beverage industry comprises 126 listed companies with a total market capitalization of 46,266.30 billion and a circulating market value of 45,144.74 billion [5]. Market Performance - The absolute performance of the industry over the past month is -2.1%, with a 6-month performance of 2.7% and a 12-month performance of -4.9%. Relative performance shows a decline of -5.9% over one month, -17.1% over six months, and -22.4% over twelve months [6]. Policy Impact - The countervailing measures are expected to create a market space of approximately 20 billion for cream and 14 billion for cheese, accelerating domestic substitution. The report highlights that the production capacity of deep processing projects is expected to consume over 400 million tons of raw milk, potentially leading to a reversal in the raw milk cycle by the second half of 2026 [8]. Investment Opportunities - The report identifies three main investment opportunities: - Domestic substitutes that will directly benefit from the policy, with a focus on companies like Lihigh and Miaoke, which are positioned to capture high-end market segments [8]. - Dairy farms such as Youran and Modern Dairy, which are expected to benefit from a reversal in raw milk prices [8]. - Leading dairy companies like Yili and Mengniu, which are anticipated to strengthen their competitive edge through accelerated deep processing business and improved operational stability [8].

Investment Rating - The report maintains a "Recommendation" rating for the computer industry [4] Core Insights - The report highlights the strategic importance of China Electronics as a core technological force in the national cybersecurity and information industry, emphasizing its comprehensive product spectrum and technology system [7][13] - It discusses the establishment of the PKS ecosystem, which is the first domestic standard for computer hardware and software, aimed at addressing key technological challenges and enhancing the value of data elements [33][49] - The report suggests that the market transformation of China Electronics, driven by external mergers and internal incentives, is expected to accelerate, with a focus on improving the quality of listed companies and optimizing asset layouts [53][54] Summary by Sections 1. Addressing Key Challenges - China Electronics aims to tackle the "bottleneck" issues in the semiconductor and software sectors, having developed a complete product spectrum from chips to application systems [7][13] - The company has undergone significant restructuring and mergers since 2005, optimizing its industrial structure and enhancing its competitive advantages across various electronic information sectors [13][14] 2. PKS Ecosystem and Data Elements - The PKS ecosystem integrates various components, including the Feiteng CPU and Kylin OS, to create a robust domestic computing infrastructure [33][34] - The report notes that data has become the fifth production factor, with China Electronics actively participating in the marketization of data elements, addressing challenges related to rights, pricing, and security [39][49] 3. Market Transformation through Mergers and Incentives - The report outlines the ongoing market transformation of China Electronics, highlighting its efforts to list assets and implement employee stock ownership plans to boost internal vitality [8][53] - It emphasizes the importance of mergers and acquisitions in enhancing the operational efficiency of state-owned enterprises, aligning with national reform initiatives [54] 4. Investment Recommendations - The report identifies potential investment opportunities in companies under China Electronics, including Huada Jiutian, Dameng Data, China Software, and others, suggesting that these platforms may experience a revaluation of their worth [8][10]

Investment Rating - The report maintains a "Strong Buy" rating for Geely Automobile (00175.HK) [1] Core Views - The completion of the privatization of Zeekr enhances profits and promotes strategic integration, expected to increase net profit by 2-3 billion RMB in 2026 [1] - The company is in a strong new product cycle with high hit rates for new models, including the Galaxy A7 and Galaxy M9, which are expected to maintain strong sales [1] - Sales growth combined with a shift towards higher-end models is anticipated to significantly boost profits, with projected net profit margins increasing to 6.4% by 2027 [1] - Geely is considered a top pick for the upcoming recovery in the automotive sector due to its low valuation and strong growth potential [1] Financial Summary - Total revenue projections for 2024A, 2025E, 2026E, and 2027E are 241,099 million RMB, 349,740 million RMB, 448,010 million RMB, and 496,572 million RMB respectively, with year-on-year growth rates of 33.5%, 45.1%, 28.1%, and 10.8% [1] - Net profit forecasts for the same years are 16,632 million RMB, 18,645 million RMB, 26,296 million RMB, and 31,749 million RMB, reflecting growth rates of 213.3%, 12.1%, 41.0%, and 20.7% [1] - Earnings per share (EPS) are projected to be 1.65 RMB, 1.74 RMB, 2.45 RMB, and 2.96 RMB for 2024A, 2025E, 2026E, and 2027E respectively [1] - The price-to-earnings (P/E) ratio is expected to be 9, 9, 6, and 5 for the same years [1]

- The report introduces a "Total Heat Index" indicator, which aggregates the browsing, self-selection, and click counts of individual stocks, normalized by their market share on the same day, and then multiplied by 10,000, with a value range of [0,10000][7] - The "Total Heat Index" is used as a proxy variable for "emotional heat" to track the overall market sentiment for broad-based indices, industries, and concepts[7] - The report constructs a simple rotation strategy based on the weekly heat change rate (MA2) of broad-based indices, buying the index with the highest heat change rate at the end of each week, and staying out of the market if the highest change rate belongs to the "others" group[13][15] - The rotation strategy based on the heat change rate (MA2) has an annualized return of 8.74% since 2017, with a maximum drawdown of 23.5%, and a return of 31.42% in 2025[16] - The report also constructs two simple portfolios: one selecting the top 10 stocks with the highest total heat from the top 5 concepts with the largest heat change rate, and another selecting the bottom 10 stocks with the lowest total heat from the same concepts[32][33] - The "BOTTOM" portfolio, which selects low-heat stocks from high-heat concepts, has historically achieved an annualized return of 15.71% with a maximum drawdown of 28.89%, and a return of 41% in 2025[34] - The "Total Heat Index" indicator is defined as the sum of browsing, self-selection, and click counts of individual stocks, normalized by their market share on the same day, and then multiplied by 10,000, with a value range of [0,10000][7] - The report calculates the weekly heat change rate (MA2) for different groups of stocks, including broad-based indices, industries, and concepts, and uses this to construct a rotation strategy[13][15] - The rotation strategy involves buying the index with the highest heat change rate at the end of each week, and staying out of the market if the highest change rate belongs to the "others" group[13][15] - The report constructs two simple portfolios: one selecting the top 10 stocks with the highest total heat from the top 5 concepts with the largest heat change rate, and another selecting the bottom 10 stocks with the lowest total heat from the same concepts[32][33] - The rotation strategy based on the heat change rate (MA2) has an annualized return of 8.74% since 2017, with a maximum drawdown of 23.5%, and a return of 31.42% in 2025[16] - The "BOTTOM" portfolio, which selects low-heat stocks from high-heat concepts, has historically achieved an annualized return of 15.71% with a maximum drawdown of 28.89%, and a return of 41% in 2025[34]

Economic Growth - Foreign institutions expect China's GDP growth in 2026 to be around 4.5%, with predictions ranging from 4.0% to 4.8%[2][10][9] - Morgan Stanley predicts a more optimistic GDP growth of 4.8%, driven by stronger export contributions and increased government consumption[2][10] - Barclays holds a cautious view, forecasting a GDP growth of 4.0%, citing ongoing real estate downturn risks[2][10] Inflation - CPI is expected to slightly rebound to a range of 0% to 1% in 2026, while PPI is projected to narrow its decline to below -2%[3][11] - There is a divergence in views regarding when PPI will turn positive, with optimistic forecasts suggesting late 2026 and cautious views pushing it to early 2027[3][11] Consumption - Consumption growth is anticipated to slow slightly due to weak income expectations and ongoing pressures in the real estate market[3][12] - Analysts expect government consumption to increase, with predictions of a rise from 5.1% in 2025 to 5.3% in 2026[12] Investment - Fixed asset investment growth is expected to recover slightly to a range of 2% to 4% in 2026, supported by new policy financial tools and government debt expansion[3][13] - Investment in high-tech manufacturing and AI is projected to maintain high growth rates[13] Real Estate - The real estate sector is expected to continue its adjustment phase in 2026, with weak demand and rising inventory being key concerns[3][14] - There is a consensus that strong stimulus measures are unlikely, with varying views on the extent of policy support[14] Exports - Export resilience is expected to slightly weaken in 2026, with factors supporting strong exports in 2025 not likely to persist[3][15] - Deutsche Bank predicts a more optimistic export growth of 6%, citing stable market share despite high tariffs and improved US-China relations[15][16] Risks - Upside risks include stronger-than-expected fiscal measures and improved consumer confidence due to social security reforms[3][18] - Downside risks involve potential corporate bankruptcies due to price suppression and renewed tensions in US-China relations[18]

1. Report Industry Investment Rating No information provided in the content. 2. Core View of the Report On December 22, the convertible bond market followed the underlying stocks to rise, with increased valuation. The small - cap value style was relatively dominant, and the trading sentiment in the convertible bond market heated up. The prices and valuations of convertible bonds generally increased, and most industries in the underlying stocks and convertible bonds rose [1]. 3. Summary by Relevant Catalogs 3.1 Market Main Index Performance - The CSI Convertible Bond Index closed at 487.96, up 0.55% daily, 1.03% weekly, -0.02% monthly, and 17.71% since the beginning of 2025. Other convertible bond - related indices and major A - share indices also showed different degrees of increase or decrease [7]. - In terms of style indices, the small - cap index (Shenwan) closed at 5459.73, up 1.12% daily. The small - cap growth index closed at 6109.78, up 1.46% daily. Different style indices had their own performance trends [8]. 3.2 Market Fund Performance - The trading volume of the convertible bond market was 696.34 billion yuan, and the trading volume of the A - share market was 18821.94 billion yuan. The net inflow of the main funds in the Shanghai and Shenzhen stock markets was 17.43 billion yuan. The 10 - year Treasury bond yield increased by 1.07BP, and the convertible bond spread increased by 0.27PCT [9][13]. 3.3 Convertible Bond Valuation - After excluding convertible bonds with a closing price > 150 yuan and a conversion premium rate > 50%, the 100 - yuan par - fitted conversion premium rate was 33.42%, up 0.91pct, at the 99.80% quantile since 2019. The overall weighted average par was 99.91, up 0.38% [18][19][22]. - The price median was 132.41, up 0.67%, at the 98.50% quantile since 2019. The conversion premium rate was divided by stock - bond nature: the partial - debt type decreased by 0.59pct, and the balanced type increased by 0.36pct [22][29]. 3.4 Industry Rotation - In the underlying stock market, the top three rising industries were commerce and retail (+3.66%), light industry manufacturing (+2.17%), and environmental protection (+2.06%); the top three falling industries were banking (-0.44%), electronics (-0.29%), and coal (-0.29%). - In the convertible bond market, the top three rising industries were environmental protection (+4.16%), building materials (+2.40%), and building decoration (+1.65%); the top three falling industries were non - bank finance (-1.26%), national defense and military industry (-0.16%), and pharmaceutical biology (-0.15%) [3].