1. Report Industry Investment Rating No relevant content provided in the report. 2. Core Views of the Report - The convertible bond market declined with reduced trading volume today, and the valuation compressed on a month - on - month basis [1]. - The small - cap value style was relatively dominant in the market [1]. - The trading sentiment in the convertible bond market weakened [1]. 3. Summary by Related Catalogs Market Overview - Index performance: The CSI Convertible Bond Index decreased by 0.25% month - on - month, the Shanghai Composite Index decreased by 0.13%, the Shenzhen Component Index decreased by 0.06%, the ChiNext Index increased by 0.16%, the SSE 50 Index decreased by 0.26%, and the CSI 1000 Index decreased by 0.27% [1]. - Market style: Small - cap value was relatively dominant. Large - cap growth decreased by 0.23%, large - cap value decreased by 0.13%, mid - cap growth decreased by 0.60%, mid - cap value decreased by 0.17%, small - cap growth decreased by 0.32%, and small - cap value decreased by 0.01% [1]. - Fund performance: The trading sentiment in the convertible bond market weakened. The trading volume of the convertible bond market was 67.972 billion yuan, a month - on - month decrease of 9.64%; the total trading volume of the Wind All - A Index was 1527.42 billion yuan, a month - on - month increase of 3.58%; the net outflow of the main funds in the Shanghai and Shenzhen stock markets was 28.594 billion yuan, and the yield of the 10 - year Treasury bond increased by 0.02bp to 1.64% on a month - on - month basis [1]. Convertible Bond Price - The central price of convertible bonds decreased, and the proportion of high - price bonds decreased. The weighted average closing price of convertible bonds was 123.61 yuan, a month - on - month decrease of 0.24%. Among them, the closing price of equity - biased convertible bonds was 165.61 yuan, a month - on - month decrease of 1.49%; the closing price of bond - biased convertible bonds was 114.66 yuan, a month - on - month decrease of 0.30%; the closing price of balanced convertible bonds was 123.78 yuan, a month - on - month decrease of 0.38% [2]. - From the distribution of convertible bond closing prices, the proportion of high - price bonds above 130 yuan was 31.62%, a month - on - month decrease of 1.28pct; the range with the largest change in proportion was 100 - 110 (including 110), with a proportion of 4.27%, a month - on - month increase of 0.85pct; there were 2 bonds with a closing price below 100 yuan. The median price was 125.10 yuan, a month - on - month decrease of 0.32% [2]. Convertible Bond Valuation - Valuation compressed. The fitted conversion premium rate of 100 - yuan par value was 24.59%, a month - on - month decrease of 0.87pct; the overall weighted par value was 94.52 yuan, a month - on - month decrease of 0.18% [2]. - The premium rate of equity - biased convertible bonds was 6.43%, a month - on - month increase of 0.04pct; the premium rate of bond - biased convertible bonds was 94.34%, a month - on - month increase of 2.34pct; the premium rate of balanced convertible bonds was 17.97%, a month - on - month increase of 0.30pct [2]. Industry Performance - In the A - share market, the top three industries in terms of increase were media (+1.35%), agriculture, forestry, animal husbandry and fishery (+0.65%), and commerce and retail (+0.48%); the top three industries in terms of decline were non - ferrous metals (-2.26%), basic chemicals (-0.85%), and electronics (-0.82%) [3]. - In the convertible bond market, 22 industries declined. The top three industries in terms of decline were building materials (-1.83%), national defense and military industry (-1.39%), and communication (-0.87%); the top three industries in terms of increase were environmental protection (+5.76%), coal (+0.89%), and media (+0.28%) [3]. - Closing price: The large - cycle increased by 0.72% month - on - month, manufacturing decreased by 0.39%, technology decreased by 0.65%, large - consumption decreased by 0.07%, and large - finance decreased by 0.14% [3]. - Conversion premium rate: The large - cycle decreased by 0.21pct month - on - month, manufacturing decreased by 0.055pct, technology decreased by 0.41pct, large - consumption decreased by 0.19pct, and large - finance decreased by 0.083pct [3]. - Conversion value: The large - cycle increased by 0.94% month - on - month, manufacturing decreased by 0.40%, technology decreased by 0.42%, large - consumption increased by 0.14%, and large - finance increased by 0.72% [3]. - Pure bond premium rate: The large - cycle increased by 0.91pct month - on - month, manufacturing decreased by 0.52pct, technology decreased by 0.97pct, large - consumption decreased by 0.097pct, and large - finance decreased by 0.17pct [4]. Industry Rotation - Media, agriculture, forestry, animal husbandry and fishery, and commerce and retail led the rise. In the stock market, media had a daily increase of 1.35%, agriculture, forestry, animal husbandry and fishery had a daily increase of 0.65%, and commerce and retail had a daily increase of 0.48%. In the convertible bond market, media had a daily increase of 0.28%, environmental protection had a daily increase of 5.76%, and coal had a daily increase of 0.89% [3][57].

Investment Rating - The report gives a "Strong Buy" rating for Zhongyuan Media (000719) [1] Core Views - Zhongyuan Media is a high-quality local education publishing company with strong dividend capabilities and a high safety margin, while its new business prospects are promising [1][6] - The company benefits from its unique position as the only listed cultural enterprise in Henan Province, with a complete industrial chain covering publishing, distribution, printing, and educational services [6][13] - The company has a robust business model supported by its licensing advantages and stable revenue from its core publishing and distribution operations [6][8] Financial Summary - Total revenue is projected to grow from 9,857 million in 2024 to 11,189 million in 2027, with a compound annual growth rate (CAGR) of approximately 4.3% [2] - Net profit attributable to shareholders is expected to increase from 1,030 million in 2024 to 1,397 million in 2027, with a notable growth of 22.5% in 2025 [2] - The earnings per share (EPS) is forecasted to rise from 1.01 in 2024 to 1.37 in 2027, reflecting a steady growth trajectory [2] Business Analysis - The company's revenue structure shows that publishing and distribution account for over 75% of total revenue, with distribution contributing 57% and publishing 23% in 2024 [25][31] - The company holds exclusive rights for textbook publishing and distribution in Henan, ensuring a stable demand base due to the large number of K12 students in the province [6][44] - Zhongyuan Media is actively expanding into vocational education, market-oriented supplementary materials, and AI+ education, which are expected to provide additional growth opportunities [6][8] Dividend Capability - The company has a strong willingness and ability to pay dividends, supported by its stable cash flow and low capital expenditure [6][8] - The controlling shareholder, the Henan Provincial Government, has a vested interest in maintaining high dividend payouts, further enhancing the company's safety margin [6][8] Investment Recommendation - The report anticipates steady growth in the company's core business, with potential increases in dividends providing a stronger safety margin [9] - The target price is set at 18.49 yuan, based on a relative valuation method using a 15x PE ratio for 2025 [2][9]

Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of 15.5 yuan [2][8]. Core Insights - The company is expected to achieve a net profit attributable to shareholders of 1.06 to 1.14 billion yuan in the first half of 2025, representing a year-on-year increase of approximately 40% to 50%. The non-recurring net profit is projected to be 930 to 1,000 million yuan, with a growth of about 25% to 35% [2][8]. - The second quarter is estimated to yield a net profit of 900 to 970 million yuan, reflecting a year-on-year increase of 36.7% to 48.3%, driven by strong performance in the U8 product line and cost optimization efforts [2][8]. - The company has seen a steady revenue growth, with the U8 product continuing to perform well. Sales volume is expected to show stable growth, with positive performance across various regions [2][8]. Financial Performance Summary - Total revenue is projected to grow from 14,667 million yuan in 2024 to 15,472 million yuan in 2025, with a year-on-year growth rate of 5.5% [4]. - Net profit attributable to shareholders is forecasted to increase significantly from 1,056 million yuan in 2024 to 1,552 million yuan in 2025, marking a growth rate of 47.0% [4]. - Earnings per share (EPS) is expected to rise from 0.37 yuan in 2024 to 0.55 yuan in 2025 [4]. Market Position and Strategy - The company is positioned as a rare growth stock in the market, with ongoing reforms and the successful launch of the U8 product line contributing to improved product structure and profit margins [2][8]. - The report indicates that the company is likely to benefit from the gradual recovery of the restaurant sector and the continued expansion of its product offerings, which may enhance its market competitiveness [2][8].

Investment Rating - The investment rating for China Feihe (06186.HK) has been downgraded to "Recommended" due to lower-than-expected performance [2][7]. Core Views - The company is expected to achieve revenue of 9.1-9.3 billion with a year-on-year decline of 7.9%-9.9% and a net profit of 1-1.2 billion, reflecting a year-on-year decline of 36%-47% for the first half of 2025 [2][7]. - The company plans to invest no less than 1 billion in share buybacks and expects to distribute dividends of no less than 2 billion in 2025, down from 2.72 billion in the same period last year [2][7]. - The company anticipates low single-digit growth for the full year, with a projected revenue increase of 10%-15% in the second half of 2025 [7]. Financial Summary - Total revenue (million) for 2024 is projected at 20,749, with a slight increase to 20,766 in 2025, and further growth to 22,054 in 2026 [4]. - The net profit (million) is expected to decline from 3,570 in 2024 to 3,025 in 2025, before recovering to 3,602 in 2026 [4]. - Earnings per share (CNY) are forecasted to decrease from 0.39 in 2024 to 0.33 in 2025, with a gradual increase to 0.40 in 2026 [4]. Market Performance - The target price for the stock is set at 5.1 HKD, with the current price at 4.58 HKD [4][7]. - The company maintains a market capitalization of 41.5 billion HKD and a total share capital of 9.067 billion shares [5][7]. Industry Outlook - The company is expected to benefit from a recovery in newborn population growth and the implementation of fertility subsidies, which may improve industry conditions over the next 2-3 years [7]. - The company is positioned as a leading brand in the infant formula market, with a strong channel foundation and plans to launch higher-end products in the second half of 2025 [7].

Report Summary 1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints - The convertible bond market showed incremental growth today, with valuations rising compared to the previous day. The small - cap growth style was relatively dominant, and trading sentiment in the convertible bond market heated up [1]. - The central price of convertible bonds increased, and the proportion of high - price bonds rose. Valuations also increased, with different types of convertible bonds showing varying price and premium rate changes [2]. - Most underlying stock industries rose today, with some industries in the convertible bond market also rising while others declined [3]. 3. Summary by Directory Market Main Index Performance - The CSI Convertible Bond Index rose 0.77% compared to the previous day, the Shanghai Composite Index rose 0.70%, the Shenzhen Component Index rose 1.47%, the ChiNext Index rose 2.39%, the SSE 50 Index rose 0.57%, and the CSI 1000 Index rose 1.27%. The small - cap growth style was relatively dominant, with small - cap growth rising 1.55% [1]. - Various convertible bond - related indices, such as the Convertible Bond Equal - Weighted Index and the Convertible Bond Index, also showed different degrees of increase [7]. Market Fund Performance - The trading volume of the convertible bond market was 75.227 billion yuan, a 16.81% increase compared to the previous day. The total trading volume of the Wind All - A Index was 1.474613 trillion yuan, a 20.17% increase. The net inflow of main funds in the Shanghai and Shenzhen stock markets was 6.568 billion yuan, and the yield of the 10 - year Treasury bond rose 0.38bp to 1.64% [1]. Convertible Bond Valuation - After excluding certain convertible bonds, the 100 - yuan par - value fitted conversion premium rate was 25.47%, a 0.63pct increase compared to the previous day. The overall weighted par value was 94.75 yuan, a 1.07% increase. Different types of convertible bonds had different premium rate changes [2]. - The price median of convertible bonds was 125.51 yuan, a 0.76% increase compared to the previous day, and it was at the 95.10% quantile since 2019 [21]. Industry Performance - In the A - share market, the top three rising industries were communication (+2.89%), power equipment (+2.30%), and electronics (+2.27%), while the two declining industries were public utilities (-0.37%) and banks (-0.24%). In the convertible bond market, the top three rising industries were communication (+3.03%), electronics (+1.55%), and building materials (+1.53%), and the top three declining industries were environmental protection (-1.89%), computer (-1.25%), and public utilities (-0.08%) [3]. - In terms of different sectors, the closing price of the large - cycle sector rose 0.28%, manufacturing rose 0.69%, technology rose 1.14%, large - consumption rose 0.66%, and large - finance rose 0.59%. The conversion premium rate, conversion value, and pure - bond premium rate of each sector also showed different changes [3]. Industry Rotation - The communication, power equipment, and electronics industries led the rise. The report also provided detailed data on the daily, weekly, monthly, and year - to - date changes in the underlying stocks and convertible bonds of various industries, as well as their valuation quantiles [55].

Group 1: Macro Analysis - The narrative that the dollar will enter a prolonged decline akin to the 70s and 80s needs reassessment, as the fastest decline of the dollar may have already passed[13] - The U.S. economy's growth rate relative to Europe and Japan remains superior, suggesting potential dollar strength in the medium term[13] - The dollar index has shown a long-term divergence from the U.S. economic share, with the index rising despite a declining economic share post-2008 financial crisis[15] Group 2: Fixed Income Market Insights - In July, the bond market is expected to face downward pressure, with credit outperforming rates[29] - Government bond net financing is projected to increase to between 1.5 trillion and 1.7 trillion yuan in July due to accelerated local government bond issuance[27] - The average decline in the 10-year government bond yield from 2021 to 2024 is approximately 4.4 basis points, indicating a trend of decreasing yields[29] Group 3: Equity Market Trends - The total position of stock funds increased to 94.90%, up by 97 basis points from the previous week, indicating a bullish sentiment[36] - The average return of stock funds this week was 1.31%, reflecting positive market performance[38] - The Hang Seng Index saw a decline of 1.52%, suggesting a mixed outlook for Hong Kong equities[39] Group 4: CIPS Regulatory Changes - The People's Bank of China is revising CIPS rules to enhance participant management and flexibility, allowing for easier access to the system[43] - The CIPS system processed 821.69 million transactions worth 175.49 trillion yuan in 2024, marking a 42.60% increase year-on-year[42] - The new rules include risk management requirements and clarify the roles of domestic and foreign participants in the CIPS framework[43]

Investment Rating - The report does not explicitly provide an investment rating for the industry analyzed [2]. Core Insights - The report emphasizes the focus on "supply-side optimization" and "anti-involution" competition, with potential policy implementations expected in the second half of the year [3][8]. - Key industries identified for "anti-involution" include those with high inventory, high CAPEX, low capacity utilization, and low price levels, particularly in sectors such as chemicals, non-ferrous metals, coal, steel, and various manufacturing and consumer goods [3][11][13]. - The report outlines five perspectives for identifying potential beneficiaries of the "anti-involution" policies, including state-owned enterprise (SOE) share, industry concentration, tax revenue impact, labor intensity, and price elasticity post-capacity reduction [5][6]. Summary by Relevant Sections Policy Focus - The report highlights that the Central Financial Committee meeting on July 1 emphasized supply-side optimization and "anti-involution" competition, referencing past supply-side reforms from 2015-2016 as a model for future policy actions [3][8]. Key Industry Characteristics - Industries with high inventory, high CAPEX, low capacity utilization, and low price levels are targeted for policy intervention. These include: - Cyclical industries: Chemicals (chemical products, rubber, non-metallic materials), non-ferrous metals (energy metals), coal, and steel (common steel, steel raw materials) [3][11]. - Manufacturing: Electric new (motors, grid equipment, batteries, photovoltaics), machinery (automation equipment), automotive (passenger vehicles), military electronics, and construction [3][11]. - Consumer goods: Home appliances (appliance components), food and beverage (food processing, liquor, snacks) [3][11]. Five Perspectives for Industry Selection - **State-Owned Enterprise (SOE) Share**: Industries with higher SOE shares are expected to have stronger policy execution efficiency, including coal, common steel, cement, glass, and consumer sectors like liquor [3][5]. - **Industry Concentration**: Higher concentration industries are more likely to achieve supply clearing through stronger pricing power and quicker policy response, particularly in energy metals, non-metallic materials, and consumer goods like liquor [3][5]. - **Tax Revenue Impact**: Industries with lower tax revenue contributions will have a smaller impact on local finances during capacity reduction, focusing on sectors like glass, energy metals, and common steel [3][5]. - **Labor Intensity**: Industries with lower labor intensity will have a reduced impact on employment during capacity reduction, including non-metallic materials, chemical products, and energy metals [3][5]. - **Price Elasticity Post-Capacity Reduction**: Industries with a strong correlation between asset turnover and gross margin are expected to see greater price and margin expansion post-capacity reduction, including glass, chemical products, and energy metals [3][5]. Potential Beneficiary Industries - The report identifies several industries as potential beneficiaries of the "anti-involution" policies based on the five perspectives, including: - Coal mining, common steel, precious metals, glass fiber, coke, energy metals, steel raw materials, cement, chemical products, non-metallic materials, and various manufacturing sectors [6][7].

Investment Rating - The report maintains a "Recommendation" rating for the automotive industry, expecting the industry index to outperform the benchmark index by over 5% in the next 3-6 months [32]. Core Insights - The report highlights the upcoming launch of two significant new models in July 2025: the Li Auto i8 and the Leapmotor B01, which are expected to have a substantial impact on their respective stock prices. The Li i8 is a C-class six-seat electric SUV priced between 300,000 to 400,000 CNY, while the Leapmotor B01 is an A-class sedan priced between 100,000 to 150,000 CNY [6][10][18]. - The report suggests that the new models are likely to catalyze investment in the automotive sector, recommending a focus on companies such as Jianghuai Automobile, Li Auto, BAIC Blue Valley, SAIC Group, and others [6][10]. Summary by Sections Industry Overview - The automotive industry consists of 225 listed companies with a total market capitalization of approximately 30,810.37 billion CNY and a circulating market value of about 23,623.17 billion CNY [3]. Market Performance - The absolute performance of the automotive sector has seen declines of -3.5% over the past month, -4.3% over six months, and -9.1% over the past year. However, relative performance has improved by 1.3% over six months and 3.2% over the past year compared to the benchmark [4]. New Model Launches - The report emphasizes the importance of tracking the market expectations and launch situations of the Li i8 and Leapmotor B01, as they are anticipated to generate significant sales. The Li i8 is expected to sell 3,000 to 5,000 units monthly, while the Leapmotor B01 is projected to sell 8,000 to 10,000 units monthly [6][11][18]. Competitive Landscape - The Li i8 will compete in a market segment of approximately 130,000 units annually, targeting families with multiple children. Its main competitors include NIO ES6, Li L8, and Mercedes-Benz GLC [16]. - The Leapmotor B01 is positioned in a market of about 2.4 million units annually, appealing to young families seeking technology and value. Its competitors include BYD Qin L and Volkswagen Sagitar [21]. Investment Recommendations - The report recommends focusing on the new model launches as potential catalysts for investment in the automotive sector, particularly highlighting the Li i8 and Leapmotor B01. It suggests a positive outlook for Jianghuai Automobile and other companies mentioned [6][10].

Liquidity and Funding - The supply side of funds is contracting, with public equity new issuance dropping to 3.52 billion units from 14.36 billion, representing a 44% percentile over the past three years[8] - Southbound funds have maintained a weekly average net inflow of over 10 billion for seven consecutive weeks, totaling over 120 billion[4] - The total amount of stock buybacks increased significantly to 9 billion from 2.09 billion, reaching the 98% percentile over the past three years[24] Trading Congestion - The trading heat for the photovoltaic sector rose by 22 percentage points to 27%, while the steel sector increased by 21 percentage points to 39%[4] - The brokerage sector's trading heat increased by 14 percentage points to 53%, indicating a strong interest in these sectors[50] - Conversely, the mechanical sector's trading heat decreased by 11 percentage points to 11%, and the medical services sector fell by 6 percentage points to 84%[4] Investor Sentiment - Retail investor net inflow in the A-share market reached 81.57 billion, an increase of 21.87 billion from the previous value, placing it in the 37.6% percentile over the past five years[4] - The market saw a significant rise in search interest for A-shares on Kuaishou, reaching a new high for the year as the Shanghai Composite Index approached 3500 points[66] - The sentiment on Weibo improved significantly, driven by the Shanghai Composite Index hitting a new high, indicating a rise in optimistic sentiment among investors[74]

Investment Rating - The report maintains a "Strong Buy" rating for the company, indicating an expectation to outperform the benchmark index by over 20% in the next six months [1][21]. Core Insights - The company is experiencing significant growth in its AI server and optical module businesses, with Q2 2025 performance exceeding expectations. The forecasted net profit for H1 2025 is between 11.96 billion to 12.16 billion yuan, representing a year-on-year increase of 36.84% to 39.12% [1][6]. - The AI server segment is driving substantial revenue growth, with a projected increase of over 60% year-on-year. The overall cloud computing business is expected to grow by more than 50% compared to the same period last year [6]. - The company has established strong partnerships with major clients such as Microsoft, AWS, and NVIDIA, enhancing its competitive position in the AI server market [6]. Financial Summary - Total revenue is projected to grow from 609.14 billion yuan in 2024 to 1,196.68 billion yuan by 2027, with a compound annual growth rate (CAGR) of approximately 26% [2]. - Net profit attributable to shareholders is expected to rise from 23.22 billion yuan in 2024 to 42.96 billion yuan in 2027, reflecting a CAGR of around 19% [2]. - Earnings per share (EPS) is forecasted to increase from 1.17 yuan in 2024 to 2.16 yuan in 2027, indicating strong profitability growth [2]. Market Position - The company holds a leading position in the global server manufacturing sector, benefiting from the rising demand for AI infrastructure. The global AI server market is projected to grow from 125.1 billion USD in 2024 to 158.7 billion USD in 2025 [6]. - The company is enhancing its product offerings and optimizing its production capabilities, which is expected to further solidify its market share in the AI server segment [6].