Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - In May 2025, the total bond custody scale increased by 216.33 billion yuan month-on-month, 55.57 billion yuan more than in April, mainly due to the significant rise in the net financing scale of treasury bonds and policy financial bonds. The custody increments of local bonds, interbank certificates of deposit (CDs), and credit bonds decreased slightly month-on-month [3][6]. - The profit-taking sentiment after the reserve requirement ratio (RRR) cut and interest rate cut in May and the increase in government bond supply pressure were important factors affecting institutional behavior. Non-bank institutions' profit-taking sentiment heated up, and commercial banks had to take on more primary supply, increasing their liability pressure, which requires the central bank to maintain a loose liquidity environment [3][8]. - The bond market leverage ratio in May was about 107.1%, basically the same as in April and still significantly lower than before January this year. The leverage ratio of commercial banks increased slightly, while that of non-bank institutions decreased and remained near a three-year low [3][37]. Summary by Directory 1. Interest Rate Bonds' Net Financing Soared while Credit Bonds and CDs Slightly Declined, and the Bond Custody Increment Rose Significantly in May - The total bond custody scale increased by 216.33 billion yuan month-on-month in May, 55.57 billion yuan more than in April, mainly due to the significant rise in the net financing scale of treasury bonds and policy financial bonds. The custody increments of local bonds, interbank CDs, and credit bonds decreased slightly month-on-month [3][6]. - Specifically, for interest rate bonds, the treasury bond custody increment rose by 64.2 billion yuan to 90.8 billion yuan; the local bond custody increment decreased by 18.46 billion yuan to 52.23 billion yuan; the policy financial bond custody increment rose by 26.9 billion yuan to 28.21 billion yuan. For credit bonds, the medium-term note (MTN) custody increment decreased by 3.63 billion yuan to 7.37 billion yuan, and the short-term financing bill (STFB) custody volume changed from an increase of 3.36 billion yuan in the previous month to a decrease of 4.31 billion yuan. The custody scales of enterprise bonds and private placement notes (PPNs) continued to decline, but the decline narrowed [6]. 2. Non-bank Profit-taking Sentiment Heated up in May, and the Supply Pressure Increased, Leading to a Significant Increase in Banks' Bond Purchases and Higher Liability Pressure - **General Funds**: The custody increment decreased by 34.3 billion yuan to 81.26 billion yuan. They reduced their purchases of CDs and treasury bonds, sold STFBs and policy financial bonds, but increased their purchases of MTNs and local bonds. Relative to the stock, they reduced their allocation of bonds, especially CDs, and switched to reducing their allocation of treasury bonds and policy financial bonds [11]. - **Securities Companies**: The bond custody volume changed from an increase of 1.124 billion yuan in the previous month to a decrease of 1.261 billion yuan. They sold treasury bonds and policy financial bonds and reduced their sales of CDs. Relative to the stock, they also reduced their allocation of bonds [16]. - **Insurance Companies**: The bond custody volume changed from an increase of 99 million yuan in the previous month to a decrease of 120 million yuan. They sold local bonds, but reduced their sales of financial bonds on the Shanghai Clearing House and increased their purchases of treasury bonds. Relative to the stock, they reduced their allocation of local bonds [19]. - **Overseas Institutions**: The bond custody volume changed from an increase of 9.54 billion yuan in the previous month to a decrease of 9.63 billion yuan. They sold CDs, policy financial bonds, and commercial bank bonds and significantly reduced their purchases of treasury bonds. Relative to the stock, they reduced their allocation of bonds [23]. - **Other Institutions**: The decline in bond custody volume narrowed from 74.29 billion yuan in the previous month to 19.27 billion yuan. They reduced their sales of local bonds and treasury bonds, but sold policy financial bonds and reduced their purchases of CDs. The narrowing of the decline was mainly due to the decrease in the net reverse repurchase volume of the central bank [25]. - **Commercial Banks**: The bond custody increment increased by 90.74 billion yuan to 167.8 billion yuan, reaching a new high since July 2022. They increased their purchases of treasury bonds to a record high, switched to buying policy financial bonds, and reduced their sales of CDs. However, the custody increment of local bonds decreased significantly due to the narrowing of the net reverse repurchase volume. Relative to the stock, they increased their allocation of bonds, mainly interest rate bonds [28]. - **Credit Unions**: The bond custody increment increased by 539 million yuan to 544 million yuan. They switched to buying treasury bonds and policy financial bonds, but slightly reduced their purchases of local bonds, CDs, and financial bonds on the Shanghai Clearing House. Relative to the stock, they increased their allocation of bonds, mainly treasury bonds and local bonds [32][35]. 3. Non-bank Leverage Ratio Declined Again in May and Remained Near a Three-year Low - The bond market leverage ratio in May was about 107.1%, basically the same as in April and still significantly lower than before January this year. The leverage ratio of commercial banks increased by 0.2 percentage points to 103.3%, but was still lower than before 2025. The leverage ratio of non-bank institutions decreased by 0.4 percentage points to 116.4% and remained near a three-year low [37]. - Among non-bank institutions, the leverage ratio of securities companies decreased by 6.7 percentage points to 207.4%, and that of insurance and non-legal person products decreased by 0.2 percentage points to 113.2%, both remaining near recent lows. In the general funds, the repurchase balance of money market funds increased significantly, while that of non-money products of fund companies increased limitedly, and their absolute levels were still low. The repurchase balances of insurance companies and other products slightly declined from high levels, and that of wealth management products continued to decline slightly near a historical low [37].

Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The company has shown significant growth in business volume, outperforming the industry with a 31.76% year-on-year increase in express logistics business volume in May 2025, exceeding the industry growth rate by 14.6 percentage points [2] - The company is expected to enter a period of investment returns, with a reduction in capital expenditures and an improvement in profit margins due to network integration [4] - The international business is anticipated to open a second growth curve, supported by the operational capabilities of the Ezhou Airport and an expanding global air network [5][6] Summary by Sections Business Performance - The company achieved a total revenue of 251.13 billion yuan in May 2025, reflecting an 11.34% year-on-year growth [2] - The express logistics business volume reached 1.477 billion pieces, indicating a robust growth trajectory [2] Financial Projections - The projected net profit for the company from 2025 to 2027 is expected to be 11.91 billion yuan, 14.26 billion yuan, and 16.85 billion yuan, representing year-on-year growth rates of 17.1%, 19.7%, and 18.2% respectively [7] - The gross profit margin is projected to improve from 12.8% in 2023 to 14.8% by 2027 [8] Cash Flow and Investment - The company's free cash flow is expected to grow significantly, from 126.55 billion yuan in 2023 to 215.08 billion yuan in 2024, marking a 69.96% year-on-year increase [3] - Capital expenditures are projected to decrease, indicating a shift towards a return on investment phase [4] Market Position and Strategy - The company is transitioning into a comprehensive logistics leader, diversifying into express delivery, cold chain, and international logistics, with new business segments achieving market leadership [7] - The operational efficiency improvements through data analysis and route optimization are expected to enhance overall capacity utilization [2][3]

Overview - Since the beginning of 2025, the A-share market has experienced a slight net outflow of funds, with the annual net inflow ratio to free float market value at -0.1% as of June 16, 2025. Excluding private equity and insurance funds, the net inflow ratio is approximately -0.9%, indicating a shift towards a slight net outflow [9][10][15] - The weak performance of resident funds (bank-securities transfers and financing balances) and public funds continues, while private equity funds show a slight net inflow amid minor replenishment [9][10] - The second and third quarters typically see stronger seasonal company buybacks and dividends, providing some support to the funding environment [9] Monthly Analysis - In May 2025, the A-share market maintained a tight balance in funding, with a slight improvement compared to April. The monthly net inflow was 2,971 billion yuan, representing 0.61% of the market value. By June 16, 2025, the net inflow reached 2,428 billion yuan, or 0.56% of the market value [15][16] - Financing balances showed a slight recovery, with an increase of 135.17 billion yuan in May and a further increase of 208.25 billion yuan by June 16. However, the overall financing balance from January 1 to June 16, 2025, decreased by 440.76 billion yuan compared to 2024, indicating a net outflow [29][15] Fund Inflows and Outflows - The share of public funds decreased in May 2025, with a total decline of 199.53 billion shares when considering ETF changes. Active equity fund shares increased by 75.90 billion shares, but overall public fund shares still declined [20][15] - The net outflow from ETF funds was significant, with a net outflow of 342.93 billion yuan in May and 179.53 billion yuan by June 16 [20][15] Company Actions - Company buybacks and dividends remain strong, with buyback announcements in May 2025 totaling 1,530.67 billion yuan. By June 16, the cumulative buyback amount reached 1,029.85 billion yuan, with actual buybacks at 396.77 billion yuan [20][15] - The total dividend amount for listed companies in May 2025 was 1,765.92 billion yuan, which is an increase from April and aligns with seasonal trends [20][15] Equity Financing - The scale of equity financing continues to decline, with a total of 2179.17 billion yuan from January 1 to June 16, 2025. Although the monthly average financing scale has increased compared to 2024, it remains at historically low levels [20][15]

Investment Rating - The investment rating for the company is currently "No Rating" [1] Core Views - The report indicates that the price of pulp and paper has stabilized at a low level, with expectations of fluctuations in June and July. The actual supply prices for overseas needle and broadleaf pulp are approximately $715/ton and $500-510/ton respectively. Pulp manufacturers are showing a strong willingness to maintain prices, and some sellers are raising prices by $20/ton [1][2] - The company is expected to see a gradual improvement in operations from April to May, with a slight decline in profitability in June. The second quarter profit is expected to remain stable compared to the first quarter, while the third quarter is anticipated to stabilize as well. The fourth quarter will enter a new capacity release cycle, with expected profitability improvements [3][4] Summary by Sections Pulp and Paper Market - The pulp prices are expected to fluctuate around the bottom, with a forecast of low-level oscillation during the off-season from June to August. The prices for pulp and paper have shown signs of bottoming out, with current prices at 4140 CNY/ton for pulp and 5163 CNY/ton for paper [2][3] - Historical analysis shows that in 2022, pulp prices reached a historical high due to supply-side factors, while in 2023, both pulp and paper prices experienced a rapid decline, with pulp bottoming out at 3850 CNY/ton and paper at 5375 CNY/ton [2] Financial Performance - The company’s total revenue for 2023 is projected at 39,544 million CNY, with a slight decline of 0.6% year-on-year. The net profit attributable to the parent company is expected to be 3,086 million CNY, reflecting a year-on-year growth of 9.9% [4][7] - For the years 2025 to 2027, the net profit is projected to be 35.8 billion CNY, 43.0 billion CNY, and 48.1 billion CNY respectively, with corresponding P/E ratios of 10.5X, 8.8X, and 7.9X [3][4] Production Capacity - The company plans to gradually launch its Nanning base project in Q3 to Q4, which includes the production of 150,000 tons of household paper, 400,000 tons of specialty paper, 1,000,000 tons of corrugated paper, and 500,000 tons of pulp, which is expected to increase the underlying profit by approximately 500 million CNY annually [2][3]

Investment Rating - The report assigns a "Buy" rating for Yadea Holdings (1585.HK) based on its strong performance and growth potential [1]. Core Views - Yadea Holdings has released a positive profit forecast, expecting a net profit of 1.6 billion yuan for the first half of 2025, representing a year-on-year growth of approximately 55% compared to 1.03 billion yuan in the first half of 2024. This growth is attributed to strong product sales and continuous optimization of the product structure [1][2]. - The company is expected to benefit from the significant results of the national "old-for-new" policy for electric bicycles, with an anticipated 30%+ year-on-year growth in electric two-wheeler sales for the first half of 2025 [2]. - Yadea is actively expanding into the mid-to-high-end market with new product lines such as "Modern" and "Crown Power," which are expected to enhance product structure and improve average selling prices and gross margins [2][3]. - The report forecasts Yadea's net profits for 2025, 2026, and 2027 to be 2.85 billion yuan, 3.37 billion yuan, and 3.84 billion yuan respectively, with corresponding P/E ratios of 12.5X, 10.5X, and 9.3X [3]. Financial Summary - For the fiscal year 2024, Yadea's revenue is projected at 28.236 billion yuan, with a significant increase to 39 billion yuan in 2025, reflecting a growth rate of 38% [5]. - The net profit for 2024 is estimated at 1.272 billion yuan, with a substantial increase to 2.85 billion yuan in 2025, indicating a growth rate of 124% [5][7]. - The report highlights key financial ratios, including a gross margin improvement from 15.19% in 2024 to 17.43% in 2025, and a net profit margin increase from 4.51% to 7.31% over the same period [7].

Investment Rating - The investment rating for the aviation transportation industry is "Positive" [2]. Core Viewpoints - The report highlights that the supply in the aviation industry is gradually contracting, with a narrowing decline in ticket prices. An improvement in supply-demand dynamics is expected during the peak travel season [3][4]. - The industry is experiencing a high passenger load factor, with limited room for recovery in utilization rates. The supply contraction is intensifying, leading to a trend of narrowing year-on-year ticket price declines, which may improve the industry’s supply-demand relationship [14][3]. Summary by Sections Investment Recommendations - The report suggests focusing on key airlines such as Air China, China Southern Airlines, Spring Airlines, Juneyao Airlines, and China Eastern Airlines due to the anticipated recovery in air travel demand during the peak season [3][14]. Industry Supply Contraction and Ticket Price Trends - The industry’s passenger load factor remains high, with an increasing proportion of grounded aircraft. In April 2025, the industry’s Available Seat Kilometers (ASK) and Revenue Passenger Kilometers (RPK) increased by 8.1% and 11.5% year-on-year, respectively, with a passenger load factor of 84.5%, up 2.6 percentage points year-on-year [4][16]. - The average ticket price in June 2025 was down 5.9% year-on-year, with the average domestic ticket price for 2025 year-to-date at 837 RMB, a decline of 9.4% year-on-year [5][26]. Oil Prices and Exchange Rates - The average price of aviation kerosene in Q1 and Q2 2025 was 5,952 RMB/ton and 5,385 RMB/ton, respectively, showing a year-on-year decrease of 10.0% and 17.0%. The Brent crude oil price averaged 67.95 USD/barrel as of June 16, 2025, down 18.1% year-on-year [6][37][38]. Airline Capacity and Load Factors - In May 2025, airlines increased their international capacity, with domestic load factors remaining high. The overall ASK for major airlines showed a year-on-year increase, with international routes recovering faster than domestic routes [45][46]. - The report indicates that the passenger load factors for domestic routes exceeded those of 2019, with significant increases noted for China Eastern and China Southern Airlines on international routes [45][47].

Investment Rating - The report assigns a "Buy" rating for the company [3][5]. Core Insights - The company is positioned to benefit from the new national subsidy policy for heavy trucks, which includes the replacement of old vehicles, potentially leading to significant sales growth [4][13]. - The company is expanding into the passenger vehicle market with its eCall system, which is expected to become a standard feature in new cars by 2027, creating a substantial market opportunity [4][44]. - The trend towards the smartification of two-wheeled vehicles presents a new growth avenue for the company, with significant revenue potential anticipated [4][56]. Summary by Sections Commercial Vehicle Market - The introduction of subsidies for the replacement of National IV heavy trucks is expected to stimulate demand, with potential sales increases of 114,000 to 266,000 vehicles based on different replacement ratios [4][31]. - The company has established strong partnerships with leading manufacturers in the commercial vehicle sector, enhancing its market position [4][38]. eCall and Domain Controller - The mandatory implementation of the eCall system in China is projected to create a market worth approximately 11.03 billion yuan by 2027, with the company already securing important contracts and certifications [4][48]. - The company has received EU certification for its eCall products, positioning it favorably for international market opportunities [4][52]. Two-Wheeled Vehicle Market - The smartification trend in two-wheeled vehicles is expected to drive demand for various smart components, with a projected market size of 5.153 billion yuan at a 30% penetration rate [4][56]. - The company is actively pursuing opportunities in this segment, anticipating significant revenue growth [4][56]. Financial Projections - Revenue forecasts for the company from 2025 to 2027 are estimated at 697 million, 935 million, and 1.255 billion yuan, respectively, reflecting growth rates of 33.2%, 34.1%, and 34.2% [6][5]. - The projected net profit for the same period is expected to be 60 million, 85 million, and 122 million yuan, indicating a strong recovery trajectory [6][5].

Investment Rating - The industry investment rating is "Positive" [2] Core Insights - The report highlights the upcoming launch of the Meta Oakley smart glasses, designed specifically for sports enthusiasts, which is expected to enhance the penetration rate of AI sports glasses in the market [2][3] - AI shooting glasses are becoming a consumer-grade product, with global sales yet to significantly increase. The report identifies that the lack of hardware and software compatibility is a core reason for the slow adoption in the domestic market [3] - The report anticipates that AI sports glasses, which integrate multiple functionalities, will become essential for outdoor sports, as they address the previous issue of "functional islands" in sports equipment [3] - The report draws a parallel between AI sports glasses and action cameras, suggesting that the core functionalities of both are similar, focusing on first-person perspective shooting and advanced algorithms for AI detection and stabilization [3] - The report recommends focusing on the company "Inpaiss" as a potential strategic target in the AI and sports sector, which is collaborating with leading smart glasses manufacturers [3]

Investment Rating - The industry investment rating is "Positive" [2] Core Viewpoints - Manufacturing investment has slightly declined, but there are opportunities to capture from the bottom up [2] - The manufacturing PMI for May 2025 is 49.5%, showing a month-on-month increase of 0.5 percentage points, indicating a slight recovery in manufacturing activity [13][27] - Fixed asset investment in manufacturing from January to May 2025 has grown by 8.5% year-on-year, but this is a decrease of 0.3 percentage points compared to the previous four months [13][27] Company Summaries 1) Jiao Cheng Ultrasonic - Focuses on ultrasonic equipment and solutions, achieving revenue of 148 million yuan in Q1 2025, a year-on-year increase of 22.35% - Net profit attributable to shareholders reached 23.63 million yuan, up 2152.47% year-on-year, with non-recurring net profit at 19.77 million yuan, a growth of 1068.17% [3][14] 2) Zhenghe Industrial - Engaged in the R&D, manufacturing, and sales of various chain drive systems, with Q1 2025 revenue of 395 million yuan, a year-on-year increase of 6.32% - Net profit attributable to shareholders was 53.84 million yuan, up 100.09% year-on-year, and non-recurring net profit was 30.26 million yuan, a growth of 16.45% [4][15] 3) Lvtian Machinery - Main products include general power machinery and high-pressure cleaning machines, with revenue growth rates of 47.9%, 72.5%, and 50.1% for Q3 2024, Q4 2024, and Q1 2025 respectively - Net profit growth rates for the same periods were 24.1%, 55.9%, and 56.3%, indicating a performance turning point [5][16] 4) Sande Technology - Achieved revenue of 108 million yuan in Q1 2025, a year-on-year increase of 18.35% - Net profit attributable to shareholders was 28.07 million yuan, up 45.38% year-on-year, with non-recurring net profit at 27.35 million yuan, a growth of 51.23% [6][17] Industry Trends - The manufacturing sector is experiencing a slight investment decline, but there are positive indicators in specific segments such as process industries and individual stocks with strong performance [7][14] - The demand for industrial robots is increasing, with a production growth of 35.5% year-on-year in May 2025, reflecting a shift towards automation in manufacturing [49][51] - The excavator sales in May 2025 reached 18,202 units, a year-on-year increase of 2.1%, indicating resilience in the construction machinery sector despite some internal sales pressure [58]

Group 1 - The report focuses on the ICBC Credit Suisse Active Quantitative Investment Team, highlighting their strong performance and innovative strategies in the current market environment [2][12][13] - The team operates under a "multi-perspective, multi-asset, multi-factor, multi-strategy" approach, led by experienced quant expert Jiao Wenlong, which provides them with a significant competitive advantage [2][12][13] - The team has a well-structured organization with diverse backgrounds, allowing for effective collaboration across various asset classes and investment strategies [3][15][24] Group 2 - The team has developed the ARC Investment Navigation System, which emphasizes active management, mean reversion, and certainty in investment decisions, enhancing their ability to navigate macroeconomic cycles [5][24] - The product line is diverse, primarily focusing on fundamental quantitative and index-enhanced strategies, which together account for over 80% of their total assets under management [35][36] - The team has achieved notable performance metrics, with specific products like ICBC New Value and ICBC New Opportunities showing strong returns compared to their benchmarks [4][20][36] Group 3 - The quantitative research framework is comprehensive, utilizing a combination of traditional multi-factor models and advanced algorithms to enhance stock selection capabilities [25][26][30] - The integration of subjective and quantitative analysis allows the team to leverage deep industry insights while maintaining a robust quantitative approach [30][31] - The team has established a systematic platform for research and investment, facilitating efficient collaboration and strategy implementation across the organization [32][33]