Quantitative Models and Construction Methods 1. Model Name: RNN-LIN - **Model Construction Idea**: Simplify the traditional GRU model by using a linear RNN structure, reducing parameter complexity while maintaining competitive performance[2][17][20] - **Model Construction Process**: - The model uses a linear RNN structure with only a forget gate and an output gate. The hidden state is updated without non-linear activation functions - Equations: $ h_{t} = f_{t} \otimes h_{t-1} + (1 - f_{t}) \otimes c_{t} $ $ y_{t} = o_{t} \otimes h_{t} $ $ f_{t} = Sigmoid(x_{t}W_{f}) $ $ o_{t} = Sigmoid(x_{t}W_{o}) $ $ c_{t} = SiLU(x_{t}W_{c}) $ - $f_{t}$: Forget gate - $o_{t}$: Output gate - $c_{t}$: Candidate state[20][21] - The model reduces parameters by approximately 50% compared to GRU[21] - **Evaluation**: The linear RNN model shows slightly weaker performance than GRU but remains competitive. Adding GLU modules improves its performance significantly[22][53] 2. Model Name: DecompGRN - **Model Construction Idea**: Extend the linear RNN by integrating cross-sectional information directly into the RNN gating mechanism, enabling simultaneous modeling of temporal and cross-sectional data[2][50] - **Model Construction Process**: - The first RNN layer outputs individual stock representations at each time step - Cross-sectional information is incorporated by grouping stocks based on market capitalization and calculating group de-meaned values - The second RNN layer combines temporal and cross-sectional information in the forget and output gates - Equations: $ h_{t} = f_{t} \otimes h_{t-1} + (1 - f_{t}) \otimes c_{t} $ $ y_{t} = o_{t} \otimes h_{t} $ $ f_{t} = Sigmoid(x_{t}W_{f}) $ $ o_{t} = Sigmoid(x_{t}W_{o}) $ $ c_{t} = SiLU(x_{t}W_{c}) $ - $f_{t}$: Forget gate - $o_{t}$: Output gate - $c_{t}$: Candidate state[50][55] - **Evaluation**: DecompGRN outperforms the GRU baseline in terms of RankIC and RankICIR while maintaining only 43% of the GRU's parameter count[74][53] --- Model Backtest Results 1. RNN-LIN - **RankIC**: - CSI All Share: 0.13 - CSI 300: 0.10 - CSI 500: 0.09 - CSI 1000: 0.12[36][37] - **RankICIR**: - CSI All Share: 1.08 - CSI 300: 0.62 - CSI 500: 0.71 - CSI 1000: 0.96[36][37] - **IC Win Rate**: - CSI All Share: 0.88 - CSI 300: 0.74 - CSI 500: 0.78 - CSI 1000: 0.86[36][37] - **Annualized Return (Top Group)**: - CSI All Share: 42.59% - CSI 300: 28.59% - CSI 500: 23.68% - CSI 1000: 32.81%[42] 2. DecompGRN - **RankIC**: - CSI All Share: 0.141 - CSI 300: 0.099 - CSI 500: 0.098 - CSI 1000: 0.127[55][58] - **RankICIR**: - CSI All Share: 1.26 - CSI 300: 0.65 - CSI 500: 0.77 - CSI 1000: 1.08[55][58] - **IC Win Rate**: - CSI All Share: 0.89 - CSI 300: 0.74 - CSI 500: 0.78 - CSI 1000: 0.88[55][58] - **Annualized Return (Top Group)**: - CSI All Share: 57.68% - CSI 300: 31.69% - CSI 500: 26.9% - CSI 1000: 40.35%[57][58] --- Index Enhancement Test Results (DecompGRN) - **Annualized Excess Return**: - CSI 300: 10.24% - CSI 500: 10.05% - CSI 1000: 19.58%[75][85] - **Tracking Error**: - CSI 300: 5.07 - CSI 500: 6.1 - CSI 1000: 6.75[75][85] - **Cumulative Excess Return (as of 2025-08-27)**: - CSI 300: 3.93% - CSI 500: 6.72% - CSI 1000: 18.26%[75][85]

Investment Rating - The report maintains a "Buy" recommendation for the electricity and public utilities sector, highlighting potential catalysts from green energy policies [2] Core Insights - The report indicates a recovery in profitability for thermal power, stable growth in hydropower, and anticipates future developments in nuclear and green energy sectors [2][5] Summary by Sections Thermal Power - The decline in coal prices has driven performance improvements, with notable profit growth in companies such as JianTou Energy (+157.96%) and JingNeng Power (+116.63%) in H1 2025 [5][10] - The outlook suggests that continued coal price declines may lead to excess profits for thermal power companies, with coal prices significantly lower than the previous year [14][17] Hydropower - Performance in hydropower has been driven by improved water inflow, with companies like MinDong Power (+32.96%) and GanSu Energy (+16.87%) showing strong profit growth in H1 2025 [27][33] - The outlook indicates a potential shift in market dynamics due to rising long-term bond rates, which may affect asset allocation strategies [39] Nuclear Power - Short-term performance for nuclear power companies has been under pressure, with China Nuclear Power reporting a 3.7% decline in net profit in H1 2025, while China General Nuclear Power saw a 16.3% drop [41][42] - The long-term outlook remains positive, with significant growth potential expected as new nuclear units are commissioned [54] Green Energy - The offshore wind sector is poised for growth, although traditional green energy faces challenges. Companies like FuNeng Co. reported a 12.48% increase in net profit, while others experienced declines due to weak wind conditions [59][60] - The report emphasizes the importance of policy catalysts for offshore wind development and suggests monitoring companies involved in this sector [5][58]

Investment Rating - The report maintains a "Recommendation" rating for the company with a target price of 30.24 CNY [2][8]. Core Insights - The company achieved a revenue of 47.425 billion CNY in the first half of 2025, representing a year-on-year growth of 24.96%. However, the total profit decreased by 25.56% to 1.401 billion CNY, while the net profit attributable to shareholders increased by 4.05% to 1.041 billion CNY. The non-recurring net profit saw a significant increase of 25.10% to 1.118 billion CNY [2][4]. - The company's growth is driven by dual engines: government and enterprise sectors alongside international expansion. The subsidiary, Xinhua San, reported a revenue of 36.404 billion CNY, up 37.75% year-on-year, with net profit reaching 1.851 billion CNY. The domestic government enterprise revenue surged by 53.55% to 31.035 billion CNY, while international revenue grew by 60.25% to 1.919 billion CNY [2][8]. - The company is focusing on AI technology integration across its product offerings, enhancing capabilities in computing clusters, network switching, storage, and security. Notable advancements include the launch of the S12500AI series core switch and the DeepSeek model machine, which are being applied in various industries [2][8]. Financial Summary - The projected total revenue for 2025-2027 is estimated at 93.346 billion CNY, 104.282 billion CNY, and 115.669 billion CNY, with corresponding growth rates of 18.1%, 11.7%, and 10.9% respectively. The net profit attributable to shareholders is forecasted to be 2.060 billion CNY, 1.543 billion CNY, and 1.803 billion CNY for the same period, with growth rates of 31.0%, -25.1%, and 16.9% respectively [4][8]. - The company’s financial ratios indicate a projected PE ratio of 42 for 2025, with a target price of approximately 30.24 CNY based on comparable company valuations and historical levels [4][8].

Investment Rating - The report maintains a "Recommended" rating for the company with a target price of 11 yuan for 2025 [2][9]. Core Insights - The company achieved a revenue of 51.5 billion yuan in the first half of 2025, a year-on-year increase of 0.4%, and a net profit attributable to shareholders of 1.45 billion yuan, up 2.2% year-on-year [2][9]. - The gross margin for the residential development business has improved, with a gross margin of 14.38% in the first half of 2025, an increase of 2.39 percentage points compared to the same period in 2024 [9]. - The sales contribution from the core 10 cities has risen to 70%, with a total contracted sales area of 3.35 million square meters and a sales amount of 88.9 billion yuan in the first half of 2025 [9]. - The company has actively replenished its land reserves, acquiring 16 plots of land with a total construction area of approximately 1.67 million square meters and a total land price of about 35.3 billion yuan [9]. Financial Summary - The company’s total revenue is projected to decline from 178.95 billion yuan in 2024 to 169.93 billion yuan in 2027, with a compound annual growth rate of -0.2% [5][10]. - The net profit attributable to shareholders is expected to increase from 4.04 billion yuan in 2024 to 6.15 billion yuan in 2027, reflecting a growth rate of 23.0% in 2027 [5][10]. - The earnings per share (EPS) is forecasted to rise from 0.45 yuan in 2024 to 0.68 yuan in 2027 [5][10].

Investment Rating - The report maintains a "Recommendation" rating for the company with a target price of 9.44 yuan [2][7]. Core Views - The company has seen a recovery in land transfer income and is steadily advancing its business transformation. The significant revenue growth in the first half of 2025 is primarily driven by land development, although the corresponding costs have also increased significantly [7][8]. - The company is recognized for its strong ability in attracting investment and has a favorable location for industrial parks, which enhances business stability as it transitions into park operations and green utilities [7][8]. Financial Performance Summary - For the first half of 2025, the company achieved a revenue of 2.104 billion yuan, a year-on-year increase of 39.19%, and a net profit attributable to the parent company of 592 million yuan, up 5.32% year-on-year [7]. - The revenue from park development and operations, green utilities, and other segments reached 1.66 billion yuan, 360 million yuan, and 90 million yuan respectively, with year-on-year growth rates of 44%, 22%, and 30% [7]. - The gross profit margins for these segments were 48.8%, 24.82%, and 43.41%, reflecting changes of -26.98, +11.26, and +4.07 percentage points year-on-year [7]. Business Segment Insights - The leasing income from the company's parks showed stable growth, with a revenue of 410 million yuan in the first half of 2025, a 3.8% increase year-on-year, maintaining a gross margin of 61% [7]. - The company has cumulatively developed approximately 3 million square meters of park area, with an operational area of about 2.25 million square meters and an overall occupancy rate of around 81% [7]. - The green utilities segment reported a revenue of 360 million yuan, a 22% increase year-on-year, with a steady expansion in distributed photovoltaic power station assets [7]. Financial Projections - The company is projected to have total revenues of 2.685 billion yuan in 2024, increasing to 2.922 billion yuan in 2025, with a compound annual growth rate of 8.8% [3][8]. - The net profit attributable to the parent company is expected to rise from 637 million yuan in 2024 to 707 million yuan in 2025, reflecting an 11% year-on-year growth [3][8]. - Earnings per share (EPS) are forecasted to be 0.43 yuan in 2024, increasing to 0.47 yuan in 2025, and further to 0.52 yuan in 2026 [3][8].

Investment Rating - The report maintains a "Strong Buy" rating for Geely Automobile with a target price of HKD 26.04, indicating an expected upside of 39% from the current price of HKD 18.73 [6][10]. Core Insights - Geely Automobile's sales momentum continues, with August 2025 wholesale sales reaching 250,000 units, a year-on-year increase of 38% and a month-on-month increase of 5.2% [2][10]. - The company reported a revenue of CNY 150.3 billion for the first half of 2025, reflecting a year-on-year growth of 27%, and a core net profit of CNY 6.7 billion, which is a 100% increase year-on-year [2][10]. - The company has adjusted its 2025 sales target from 2.71 million units to 3 million units, driven by strong performance in its Galaxy brand and the launch of new models [10]. Financial Performance Summary - **Revenue Forecasts**: The revenue estimates for 2025-2027 have been revised upwards to CNY 353.5 billion, CNY 449.7 billion, and CNY 530.1 billion, representing year-on-year growth rates of 47%, 27%, and 18% respectively [10]. - **Net Profit Forecasts**: The net profit estimates for the same period have been adjusted to CNY 16 billion, CNY 21.8 billion, and CNY 26.6 billion, with corresponding PE ratios of 10.8x, 7.9x, and 6.5x [10]. - **Key Financial Metrics**: The company is expected to achieve a gross margin of 16.1% in 2025, with a net profit margin of 4.5% [11]. Sales and Market Dynamics - Geely's sales in August 2025 included 21,400 units sold domestically, a year-on-year increase of 58%, while exports totaled 36,000 units, a year-on-year decrease of 22% [10]. - The Galaxy brand showed significant growth, with sales increasing by 3.2 times year-on-year in August [10]. Strategic Developments - The company is advancing its electric and intelligent transformation, with new models set to launch in the latter half of 2025, including the Galaxy M9 and Lynk & Co 10 EM-P [10]. - Geely is integrating its four major brands—Geely, Galaxy, Lynk & Co, and Zeekr—to enhance operational efficiency and reduce costs [10].

Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of 10.4 yuan, corresponding to a 14x PE for 2025 [2][8]. Core Insights - The company reported a revenue of 18.07 billion yuan for H1 2025, representing a year-on-year increase of 20.8%. The net profit attributable to the parent company was 420 million yuan, a slight increase of 0.3% year-on-year. In Q2 2025, revenue reached 10.71 billion yuan, up 18.8% year-on-year, while net profit was 240 million yuan, down 9.7% year-on-year [2][8]. - The company's revenue growth was driven by strong performance in both domestic and overseas markets, with domestic revenue at 11.7 billion yuan (up 15.4% year-on-year) and overseas revenue at 6.37 billion yuan (up 32.2% year-on-year) [8]. - The report highlights the impact of tax rates and impairment losses on profitability, with a Q2 2025 net profit margin of 2.2%, down 0.7 percentage points year-on-year [8]. Financial Performance Summary - The company is projected to achieve total revenue of 33.58 billion yuan in 2025, with a year-on-year growth rate of 17.4%. The net profit is expected to reach 766 million yuan, reflecting a growth rate of 9.6% [4][9]. - Earnings per share (EPS) are forecasted to be 0.74 yuan in 2025, with a PE ratio of 10 [4][9]. - The company has a total market capitalization of 7.549 billion yuan and a debt-to-asset ratio of 76.21% [5][9]. Market Position and Strategy - The company is focusing on internal reforms to enhance operational efficiency, with a notable decrease in expense ratios. The report suggests that these reforms, combined with favorable government policies, will support revenue and profit growth [8][9]. - The company is well-positioned to benefit from structural market advantages, particularly in emerging markets with high economic growth and low penetration rates [8].

Group 1 - The report highlights the structural prosperity of service consumption within the overall consumption landscape, indicating that while overall consumption growth is slowing, service-related consumption is on the rise, with service sector PMI consistently outperforming manufacturing PMI [12][20][23] - The demand side is characterized by three new trends: price-performance ratio, emotional value, and overseas expansion, with the price-performance ratio expected to be a key driver in the Chinese consumption sector [20][23][30] - Emotional and experiential consumption is becoming a focal point for consumers, with the emotional economy projected to reach 23.1 trillion yuan in 2024, indicating a strong demand for content and experience-driven products [23][27] Group 2 - The supply side is witnessing accelerated chain store development and integration of supply chains, with offline consumption becoming increasingly standardized and efficient, particularly in the beverage and hotel sectors [36][41] - Instant retail is identified as a significant growth area for consumption internet platforms, with a projected compound annual growth rate (CAGR) exceeding 20% from 2024 to 2026, indicating a shift towards integrating online and offline retail [60][66] - The report emphasizes the importance of supply chain capabilities in the restaurant and beverage sectors, with stronger supply chain management expected to lead to increased market concentration and competitive advantages for leading brands [52][53] Group 3 - The report identifies three main investment themes: the reshaping of offline business models, the application of AI to enhance service efficiency, and the high demand for experiential consumption in tourism and sports [7][8][54] - In the offline business model reshaping, companies like Meituan, Alibaba, and JD.com are recommended for their roles in the rapid growth of instant retail and their strategic expansions into offline retail [8][60][78] - The application of AI is seen as a transformative force across various sectors, enhancing efficiency in human resources, education, and exhibition services, with companies like Keri International recommended for investment [54][54]

Investment Rating - The report maintains a "Strong Buy" rating for the company, expecting it to outperform the benchmark index by over 20% in the next six months [2][8]. Core Views - The company reported a revenue of 3.83 billion yuan for the first half of 2025, a year-on-year decrease of 9.92%, and a net profit attributable to shareholders of 354 million yuan, down 31.46% year-on-year. The decline in revenue and profit is attributed to industry competition, reduced bank wealth management and interest income, and increased foreign exchange losses [2][3]. - Despite short-term performance pressure, the company is focusing on industrial AI and robotics, which are becoming the core growth engines, partially offsetting the short-term pressures from traditional businesses. The industrial AI product TPT generated revenue of 117 million yuan, while the robotics segment brought in 110 million yuan, with new orders totaling 200 million yuan [3][8]. - The company maintains a leading position in traditional business, with a domestic market share of 40.4% in distributed control systems (DCS) and 31.2% in safety instrumented systems (SIS). The company has also made significant strides in overseas market expansion, including a contract with Algeria's national oil and gas company [3][8]. - The "1+2+N" strategic framework is being implemented, with industrial robots achieving large-scale deployment. The company has launched the world's first time-sequence hybrid expert model-driven industrial agent generation platform (TPT 2) and has signed 938 subscription-based clients, marking a strategic breakthrough in its business model [3][8]. - The company expects revenue growth of 2.0%, 13.5%, and 14.1% for 2025, 2026, and 2027, respectively, with net profit attributable to shareholders projected at 1.139 billion yuan, 1.274 billion yuan, and 1.450 billion yuan for the same years. The target price is set at 57.96 yuan, based on a 36x PE ratio for 2026 [3][8]. Financial Summary - For 2025, the company anticipates total revenue of 9.319 billion yuan, with a year-on-year growth rate of 2.0%. The net profit attributable to shareholders is expected to be 1.139 billion yuan, reflecting a growth rate of 1.9% [4][9]. - The company's total market capitalization is approximately 38.15 billion yuan, with a circulating market value of 37.77 billion yuan. The asset-liability ratio stands at 42.31% [5][9].

Investment Rating - The report maintains a "Strong Buy" rating for Gree Electric Appliances, with a target price of 52 CNY [2][8]. Core Views - The revenue performance of Gree Electric Appliances is weak, with a 2.7% year-on-year decline in H1 2025, totaling 97.62 billion CNY. However, the net profit attributable to shareholders increased by 2.0% year-on-year to 14.41 billion CNY [2][8]. - The air conditioning main business is under pressure, with a significant revenue drop of 12.1% year-on-year in Q2 2025. The company did not adjust its pricing strategy, leading to a decline in market share [2][8]. - Non-air conditioning business segments, including industrial products and green energy, showed strong growth, contributing positively to overall revenue [2][8]. - Despite the revenue decline, the company's profitability remains stable, with a net profit margin increase of 0.3 percentage points to 15.2% in Q2 2025 [2][8]. - The ongoing channel reform is expected to enhance operational efficiency in the long term, despite short-term challenges [2][8]. - The company maintains a high dividend payout ratio of 52% for 2024, indicating strong dividend attributes [2][8]. Financial Summary - For 2025, the total revenue is projected to be 200.87 billion CNY, with a year-on-year growth of 5.7%. The net profit is expected to reach 33.54 billion CNY, reflecting a growth of 4.2% [4][9]. - The earnings per share (EPS) for 2025 is estimated at 5.99 CNY, with a price-to-earnings (P/E) ratio of 7 [4][9]. - The company’s total market capitalization is approximately 232.68 billion CNY, with a circulating market value of 229.10 billion CNY [5][9].