Investment Rating - The report suggests a focus on leading domestic generative AI model companies such as iFlytek, and highlights potential in AI hardware applications with recommendations for companies like Yingzi Network, Hongsoft Technology, and Hesai [2] Core Insights - The report emphasizes that the AI industry is currently in a relatively chaotic fundamental period, with mixed macroeconomic signals and varying investor expectations. It notes that while user willingness to adopt AI technologies is increasing, payment capabilities remain weak, and products require further development [11][12] - The report identifies high-growth sectors for 2025, including AI computing power and lidar, while sectors like industrial software and medical IT are facing pressure [11][12] Summary by Sections Industry Perspective - The report discusses the launch of Alibaba's multimodal model Qwen-VLo, which enhances semantic understanding and supports multiple languages, showcasing advancements in AI capabilities [11] - Tesla's delivery of the first Model Y autonomous vehicle is highlighted, marking a significant milestone in autonomous delivery technology [11] Subsector Insights - High-growth sectors include AI computing power and lidar, while sectors like software outsourcing, financial IT, and quantum computing are expected to show steady growth. Education IT and cybersecurity are at an inflection point, while industrial software and medical IT are under pressure [10][12] Market Review - From June 30 to July 4, 2025, the computer industry index (Shenwan) fell by 1.28%, underperforming the CSI 300 index by 2.82 percentage points, indicating a challenging market environment for the sector [14] Upcoming Events - Key upcoming events include the 2025 International Drone Application and Control Conference and the second AI Glasses Industry Innovation Application Summit, which may present investment opportunities in related sectors [25][26]

Group 1: Securities Sector - The report indicates a significant increase in IPO approvals, with 149 companies approved in June alone, accounting for 86% of the total for the year, a year-on-year increase of 452% [2] - Investment recommendations focus on four main lines: (1) Hong Kong Stock Exchange benefiting from deepening connectivity and the return of Chinese concept stocks; (2) multi-financial companies with strong performance and high dividends; (3) brokerage firms showing clear improvement in performance with significant mismatches in high profitability and low valuation; (4) Sichuan Shuangma, which is expected to benefit from the technology sector [2] Group 2: Insurance Sector - The insurance industry reported a premium income of 3.06 trillion yuan in the first five months of 2025, a year-on-year growth of 3.77% [40] - The report highlights the introduction of a new commercial health insurance innovative drug directory, which aims to include high-value innovative drugs beyond basic insurance coverage [41] - The insurance sector has seen a capital increase of nearly 50 billion yuan in the first half of the year, with 13 companies completing or announcing capital increase plans [42]

Investment Rating - The report does not explicitly state an investment rating for the industry Core Insights - The AI application activity has seen a general increase overseas, while domestic applications remain stable, with notable growth in Doubao [10] - CoreWeave has become the first cloud service provider to deploy Nvidia's latest Blackwell Ultra AI chips, significantly enhancing AI training and inference efficiency, leading to a 6% increase in its stock price [11] - The smartphone storage market is undergoing structural changes driven by AI penetration, with NAND average capacity expected to reach 224GB and DRAM exceeding 8GB by 2025 [12] - In May 2025, China's smartphone sales reached approximately 24.75 million units, a year-on-year increase of 7.11% [17] - Desktop computer sales in May 2025 were approximately 1.25 million units, down 15.52% year-on-year, while laptop sales were about 1.79 million units, up 11.82% year-on-year [23] Summary by Sections Overseas Market Review - AI application activity continues to rise overseas, while domestic applications remain stable [7] - CoreWeave's deployment of Nvidia Blackwell Ultra chips marks a significant advancement in AI infrastructure [11] - The smartphone storage supply-demand structure is being reshaped due to AI [12] Consumer Electronics Dynamics - In May 2025, China's smartphone market saw a year-on-year increase in sales [17] - Desktop sales declined while the laptop market showed recovery [23]

Group 1: Portfolio Strategy Performance Tracking - The simulated portfolio returns have rebounded, with significant increases in credit positions. The industrial ultra-long and secondary ultra-long strategy combinations in the interest rate style portfolio both recorded returns around 0.15% [2][14] - In the credit style portfolio, the industrial ultra-long and secondary ultra-long strategy combinations achieved returns of 0.41% each, leading the performance [2][15] - The weekly average return of the credit style time deposit heavy combination rose to 0.14%, an increase of 9.3 basis points compared to the previous week, while the city investment heavy combination's average weekly return increased to 0.23%, up over 20 basis points from last week [2][18] Group 2: Sources of Returns - The interest income from various strategy combinations has slightly rebounded, with most strategies showing an increase in interest income. The city investment short-end sinking and secondary debt sinking strategies saw interest income increases of approximately 0.04 basis points [3][27] - The annualized interest income for most combinations remains below 2%, except for the city investment short-end sinking and barbell combinations, which are still above 1.95% [3][27] - The contribution of interest income in credit style combinations generally falls within the range of 10% to 25%, with capital gains being the primary source of returns, particularly for the city investment bullet-type and secondary debt duration combinations, where interest contributions dropped to around 13% [3][27] Group 3: Credit Strategy Excess Return Tracking - Over the past four weeks, the cumulative excess return difference between duration strategies and sinking strategies has widened. The cumulative excess returns for city investment barbell, city investment duration, and broker debt duration strategy combinations were 33.6 basis points, 7.4 basis points, and 5.8 basis points, respectively [4][31] - The excess returns for short-end strategies have decreased, with the time deposit strategy dropping to around -1.6 basis points, while the city investment sinking strategy slightly surpassed the benchmark [4][34] - The excess returns for ultra-long strategies have rebounded to levels seen in early June, with the secondary ultra-long strategy combination's excess return rising to over 17 basis points this week, contrasting with the negative readings from the previous three weeks [4][34]

Report Investment Rating - No information provided on the investment rating of the industry in the report. Core Viewpoints - As of July 4, the weighted average trading maturities of urban investment bonds and industrial bonds were 2.27 years and 3.27 years respectively, both at over 90% quantile levels since March 2021. Among commercial bank bonds, the weighted average trading maturities of secondary capital bonds, bank perpetual bonds, and general commercial financial bonds were 4.28 years, 3.73 years, and 3.27 years respectively, with bank perpetual bonds at a relatively low historical level. Among other financial bonds, the durations of securities company bonds, securities subordinated bonds, insurance company bonds, and leasing company bonds were 1.52 years, 1.69 years, 3.33 years, and 1.37 years respectively, with securities company bonds and securities subordinated bonds at relatively low historical quantiles and leasing company bonds at a relatively high historical quantile [2][9]. - The coupon duration crowding index declined and then slightly increased. After reaching its peak in March 2024, it dropped and this week slightly decreased compared to last week, currently at the 27.80% level since March 2021 [12]. Summary by Directory 1. All - Variety Maturity Overview - The weighted average trading maturities of urban investment bonds, industrial bonds, secondary capital bonds, bank perpetual bonds, general commercial financial bonds, securities company bonds, securities subordinated bonds, insurance company bonds, and leasing company bonds were 2.27 years, 3.27 years, 4.28 years, 3.73 years, 3.27 years, 1.52 years, 1.69 years, 3.33 years, and 1.37 years respectively. Their corresponding historical quantiles since March 2021 were 94.1%, 97.7%, 97.3%, 68.1%, 99.5%, 29.1%, 13.9%, 70.8%, and 82.9% [11]. - The coupon duration crowding index declined after reaching its peak in March 2024 and this week slightly decreased compared to last week, currently at the 27.80% level since March 2021 [12]. 2. Variety Microscope - **Urban Investment Bonds**: The weighted average trading maturity hovered around 2.27 years. Guangdong provincial - level urban investment bonds had a duration of over 5 years, while Guizhou provincial - level urban investment bonds' trading duration shortened to around 0.48 years. The durations of urban investment bonds in regions such as prefecture - level cities in Zhejiang, prefecture - level cities in Guangdong, district - county - level in Fujian, and prefecture - level cities in Shandong were at over 90% historical quantiles, and the durations of Hunan provincial - level and Henan prefecture - level urban investment bonds were approaching their highest levels since 2021 [3][16]. - **Industrial Bonds**: The weighted average trading maturity was around 3.27 years, slightly longer than last week. The trading maturity of the real estate industry shortened to 1.85 years, while that of the public utilities industry lengthened to 3.63 years. The real estate industry's trading maturity was at a relatively low historical quantile, while industries such as public utilities, food and beverage, biomedicine, commercial retail, and building materials were all at over 90% historical quantiles [3][20]. - **Commercial Bank Bonds**: The duration of general commercial financial bonds lengthened to 3.27 years, at the 99.5% historical quantile, higher than the same period last year. The duration of secondary capital bonds lengthened to 4.28 years, at the 97.30% historical quantile, higher than the same period last year. The duration of bank perpetual bonds lengthened to 3.73 years, at the 68.10% historical quantile, higher than the same period last year [3][23]. - **Other Financial Bonds**: In terms of the weighted average trading maturity, insurance company bonds > securities subordinated bonds > securities company bonds > leasing company bonds, at 83%, 14%, 30%, and 71% historical quantiles respectively. The duration of insurance company bonds slightly lengthened compared to last week [3][25].

- The "Style Rotation Fund Selection Strategy" is based on constructing an absolute active rotation indicator using stock holdings from two reporting periods to identify style rotation or stable style funds. The strategy employs semi-annual rebalancing at the end of March and August, focusing on equity-biased mixed funds and ordinary stock funds, excluding transaction costs[26][31][31] - The "Comprehensive Fund Selection Strategy Based on Fund Characteristics and Capabilities" integrates multiple selection factors such as fund size, holder structure, performance momentum, stock-picking ability, hidden trading ability, and gold content. These factors are equally weighted and combined. The strategy uses quarterly rebalancing at the end of January, April, July, and October, excluding transaction costs[35][40][40] - The "Fund Selection Strategy Based on Trading Motivation Factor and Stock Spread Income Factor" combines trading motivation factors and stock spread income factors derived from fund profit statements. It aims to select funds with high stock spread income, active trading motivation, and low likelihood of performance manipulation. The strategy employs semi-annual rebalancing at the end of March and August, focusing on active equity funds, excluding transaction costs[41][42][47] - The "Fund Manager Trading Uniqueness Strategy" constructs a network based on fund manager holdings and trading details to create a trading uniqueness indicator. The strategy uses semi-annual rebalancing at the beginning of April and September, focusing on equity-biased mixed funds, ordinary stock funds, and flexible allocation funds, excluding transaction costs[48][54][54] - The "Style Rotation Fund Selection Strategy" achieved a June return of 4.45%, annualized return of 9.05%, annualized volatility of 19.67%, Sharpe ratio of 0.46, maximum drawdown of 37.30%, annualized excess return of 3.43%, excess maximum drawdown of 11.25%, and IR of 0.46[31] - The "Comprehensive Fund Selection Strategy Based on Fund Characteristics and Capabilities" achieved a June return of 4.26%, annualized return of 13.09%, annualized volatility of 22.51%, Sharpe ratio of 0.58, maximum drawdown of 44.27%, annualized excess return of 4.92%, excess maximum drawdown of 17.38%, and IR of 0.61[40] - The "Fund Selection Strategy Based on Trading Motivation Factor and Stock Spread Income Factor" achieved a June return of 6.47%, annualized return of 9.03%, annualized volatility of 21.66%, Sharpe ratio of 0.42, maximum drawdown of 48.39%, annualized excess return of 3.09%, excess maximum drawdown of 19.13%, and IR of 0.53[47] - The "Fund Manager Trading Uniqueness Strategy" achieved a June return of 5.38%, annualized return of 9.86%, annualized volatility of 19.51%, Sharpe ratio of 0.51, maximum drawdown of 37.26%, annualized excess return of 4.30%, excess maximum drawdown of 10.84%, and IR of 0.85[54]

Investment Rating - The report suggests a positive outlook for the AI-PCB and core computing hardware sectors, indicating a strong demand and growth potential in these areas [1][4][32]. Core Insights - The introduction of Nvidia's GB300 NVL72 server by Dell marks a significant advancement in AI server technology, promising 50 times the AI inference output and five times the throughput, which is expected to drive demand for AI-PCB [1][4]. - The report anticipates a rapid increase in shipments of GB200 and GB300 products in the second half of the year, with strong orders from multiple AI-PCB companies leading to high growth in Q2 and Q3 [1][4]. - The semiconductor industry is experiencing a shift towards domestic production and self-sufficiency due to geopolitical tensions and export controls, which is expected to benefit domestic semiconductor companies [24][31]. Summary by Sections AI-PCB and Core Computing Hardware - The report highlights the strong growth potential in AI-PCB driven by the rapid deployment of Nvidia's Blackwell GPUs and ASIC chips, with expectations of over 7 million ASIC chips from major companies by 2026 [1][4]. - Companies in the AI-PCB sector are currently experiencing robust order volumes and are expanding production capacity to meet demand [1][4]. Consumer Electronics - The imposition of a 20% tariff on goods exported from Vietnam to the U.S. is expected to benefit the Apple supply chain, providing more pricing flexibility for Apple and its suppliers [5][6]. - The report emphasizes the importance of monitoring the foldable screen market, particularly with Apple's upcoming product innovations [6]. PCB Industry - The PCB industry is showing signs of accelerated growth, particularly in the copper-clad laminate sector, with expectations of significant year-on-year growth in Q2 [7][19]. - The report notes that the demand for AI-related copper-clad laminates is strong, with a shift towards M8 materials expected as production ramps up [1][4]. Semiconductor Sector - The storage segment is projected to see continued upward momentum, driven by increased demand from cloud computing and consumer electronics, with price increases expected for DRAM products [21][23]. - The report identifies a trend towards domestic semiconductor equipment and materials production due to export restrictions, which is expected to enhance the competitiveness of local firms [24][31]. Key Companies - The report recommends focusing on companies that are likely to benefit from the growth in AI-PCB and core computing hardware, including Shenghong Technology, Industrial Fulian, and others [32][34]. - Specific companies such as North Huachuang and Jiangfeng Electronics are highlighted for their strong market positions and growth potential in the semiconductor equipment and materials sectors [35][37].

Investment Rating - The report maintains a positive outlook on the photovoltaic and wind energy sectors, emphasizing the importance of supply chain integration and government policies [1][5][24]. Core Insights - The photovoltaic industry is undergoing a "de-involution" movement, with significant government intervention expected to address low-price competition and excess capacity [5][24]. - The wind energy sector is projected to maintain a robust installation capacity of over 100GW in 2026, despite a slowdown in bidding activity [1][12][24]. - The report highlights the importance of government policies, such as the U.S. "Big Beautiful Act," which alleviates uncertainties for solar and storage exports to the U.S. [1][3][5]. Summary by Sections Photovoltaic & Energy Storage - The "de-involution" initiative in the photovoltaic sector has reached a high level, with government meetings signaling strong administrative intervention to address pricing issues and capacity clearing [5][24]. - Supply chain integration is crucial, particularly in the silicon material segment, which is central to the current capacity surplus [5][24]. - The report anticipates a recovery in silicon prices, contingent on the downstream price transmission capabilities and collective self-discipline within the industry [5][24]. Wind Energy - The domestic price of onshore wind turbines has shown a recovery trend in Q2, with expectations for continued strong installation capacity in 2026 [1][12][24]. - The report notes that even with a slowdown in bidding, historical data suggests that installation figures will remain stable due to previously approved projects [12][24]. - The central government has reiterated its commitment to promoting orderly development in offshore wind energy [1][12][24]. Electric Grid - Recent approvals for high-voltage direct current projects indicate significant investment potential, with expected project investments exceeding 500 billion and 170 billion yuan for specific projects [2][14][15]. - The report highlights the anticipated increase in equipment bidding for high-voltage projects, projecting a breakthrough of 500 billion yuan in 2025 [15][17]. Lithium Battery - The report emphasizes the long-term potential of lithium metal anodes, which can achieve higher energy densities compared to traditional materials [2][18][24]. - It suggests a focus on leading companies in various processing routes for lithium metal anodes, as well as solid-state battery technologies [18][24]. Hydrogen and Fuel Cells - The extension of tax credits for hydrogen projects in the U.S. provides a critical window for industry development [3][23]. - The European Union's new framework for clean industrial support is expected to accelerate the deployment of green hydrogen projects [3][23]. Investment Recommendations - The report recommends specific companies across various sectors, including photovoltaic glass manufacturers, battery cell producers, and offshore wind cable suppliers, highlighting their potential for recovery and growth [24].

Investment Rating - The report maintains a positive outlook on the PCB upstream new materials, particularly in the fields of electronic cloth and copper foil [2][14]. Core Insights - The report highlights the shift in Nvidia's GB200NVLink design to high-layer, high-frequency low-dielectric PCBs, which is expected to catalyze demand for upstream new materials in AI applications [2][14]. - The report emphasizes the ongoing price increases in the waterproof industry, with major companies like Keshun and Dongfang Yuhong announcing price hikes, reflecting a consensus among industry leaders to combat excessive competition [3][15]. - The report notes the potential for local manufacturing growth in Africa, particularly through companies like Keda Manufacturing, which is integrating into local economies by producing tiles and sanitary ware [4][16]. Summary by Sections 1. Weekly Discussion - The report continues to explore the potential of PCB upstream new materials, focusing on electronic cloth and copper foil, with a significant gap in expectations for high-end copper foil materials [2][14]. 2. Industry Price Changes - The report details the recent price adjustments in the waterproof sector, with companies implementing price increases ranging from 2% to 13% across various product categories [3][15]. - It also provides insights into the cement sector, noting a national average price of 349 RMB/t, a year-on-year decrease of 41 RMB, and an average shipment rate of 43.2% [5][17]. 3. Market Performance - The report indicates that the construction materials index increased by 3.91% this week, with notable performances in glass manufacturing and fiberglass sectors [23][27]. - It highlights the average price of float glass at 1201.02 RMB/ton, with a slight increase of 0.13% compared to the previous week [5][17]. 4. National Subsidy Tracking - The report discusses the government's initiatives to boost consumption, including the organization of new energy vehicle promotions and the issuance of funds for trade-in programs [6][18]. 5. Important Changes - The report notes significant developments, including the central government's emphasis on regulating low-price competition and the announcement of price adjustments by leading waterproof companies [7][22].

Group 1 - The report highlights a potential recovery in global manufacturing, driven by renewed emphasis on physical demand and infrastructure investment in developed economies, particularly Germany and the United States [3][12][21] - Germany plans to invest €120 billion in infrastructure by 2025, with an additional €800 billion in deficits projected from 2025 to 2029, representing about 20% of its GDP [12][18] - The U.S. "One Big Beautiful Bill Act" increases tax credits for advanced manufacturing investments from 25% to 35% and allows 100% depreciation for fixed assets in the year they are put into use [12][15] Group 2 - The "anti-involution" policy is gaining attention, particularly in industries with high capacity utilization and low product prices, which may see significant profit improvements through capacity restrictions [4][31][33] - The report notes that excess capacity is concentrated in high-end manufacturing sectors like photovoltaics and lithium batteries, where demand growth is expected to continue, making direct capacity reduction less likely [4][31] - Traditional industries with higher capacity utilization and lower prices may benefit more from the "anti-involution" policies, leading to better profit elasticity [31][33] Group 3 - The report discusses a shift from virtual to real assets, indicating that while liquidity may pose risks, the fundamentals present opportunities for investment [5][37] - Chinese companies have increased capital expenditures despite declining ROIC, suggesting a recovery phase for capital returns, particularly in traditional sectors [5][37] - The report recommends asset allocation towards upstream resource products (copper, aluminum, oil) and capital goods (engineering machinery, heavy trucks) to benefit from rising physical asset demand [5][37]