1. Report Industry Investment Rating There is no information provided regarding the industry investment rating in the document. 2. Core View of the Report The report focuses on the history, overseas experiences, and future prospects of China's central bank's treasury bond trading. It analyzes the development of China's central bank's treasury bond trading from 2024 to 2025, draws lessons from the practices of the Federal Reserve and the Bank of Japan, and discusses the possible future evolution of the tool, including operation mechanisms, targets, and implementation rhythms, as well as potential optimization directions for supporting measures [2][48][94]. 3. Summary According to the Table of Contents 3.1. Treasury Bond Trading History Review - **Before 2024**: The central bank mainly participated in treasury bond trading through repurchase agreements, providing short - term liquidity to the market and smoothing out fluctuations in the capital market. Direct purchases of treasury bonds were rare, mainly for coordinating the issuance of special treasury bonds [12]. - **In 2024**: The central bank began to include treasury bond trading in open - market operations. In August, it carried out "buying short and selling long" operations, with a net purchase of 1 billion yuan in treasury bonds. The operations were mainly for base money injection and liquidity management, with buying aiming to support fiscal efforts and selling to prevent bond market risks [22][25]. - **In the first half of 2025**: In January, the central bank announced a temporary suspension of open - market treasury bond purchases, considering the controllable supply pressure of government bonds at the beginning of the year and the availability of alternative tools for liquidity management. The market's speculation about the resumption of operations emerged in June, but it did not materialize, mainly due to the marginal improvement in the supply - demand relationship of government bonds, the central bank's enhanced precision in liquidity regulation, and concerns about bond market risks [38][40][43]. 3.2. Overseas Insights into Central Bank Bond Purchases - **Federal Reserve's "Scarce Reserves" Framework**: Before 2008, the Federal Reserve used this framework, where treasury bond trading was mainly for liquidity management. Through small - scale open - market treasury bond trading, the Federal Reserve could adjust the reserve level of the banking system, affecting the federal funds rate and other interest rates, forming a transmission chain of "open - market operations - reserve scale - FFR - other interest rates" [48]. - **Federal Reserve's Treasury Bond Trading with Quantitative Easing and Twist Operations**: From 2008 to 2014, the Federal Reserve implemented large - scale asset purchase programs, aiming to influence the yield curve by changing the structure of purchased assets while maintaining a loose liquidity environment. It carried out operations such as lowering short - term interest rates, buying long - term bonds, and selling short - term bonds, and managing market expectations [68][71]. - **Bank of Japan's YCC Practice**: In 2016, the Bank of Japan introduced YCC on the basis of negative interest rates. It controlled the short - end through negative interest rates and set a target for the 10 - year treasury bond yield, promising unlimited buying and selling of 10 - year treasury bonds to achieve the target range. This enhanced the central bank's ability to control the yield curve, alleviated concerns about policy sustainability and market liquidity, and strengthened inflation expectations [74][76]. 3.3. Outlook on Central Bank Bond Purchases - **Current Situation**: Compared with the Federal Reserve and the Bank of Japan, the scale of treasury bonds held by the People's Bank of China is relatively low. Commercial banks are the main holders of treasury bonds in China, accounting for over 60% of the total. The reasons include the short implementation time of treasury bond trading, differences in tool positioning, and the limited liquidity of the treasury bond market [6][78][88]. - **Possible Future Deductions**: - **Operation Mechanism**: There is a possibility of making operations more transparent by announcing operation time, quantity, bond maturity, and pricing standards in advance, following the trend of expected management in monetary policy tools [94]. - **Operation Target**: Treasury bond trading is mainly for liquidity management and may also have the function of regulating the yield curve. Net purchases to inject liquidity are still the general direction, and attention should be paid to the term structure of the treasury bond market and the central bank's holdings [95]. - **Implementation Rhythm**: The supply pressure of government bonds will decrease in July and peak again in August - September. This could be a good observation window for restarting treasury bond trading operations [97]. - **Supporting Measures**: Potential optimization directions include increasing the proportion of discount treasury bond issuance, improving the management of treasury bond underwriters, guiding commercial banks to reduce the proportion of bonds held in the AC account, and expanding the participants in the treasury bond derivatives market [98].

Group 1: Report Industry Investment Rating - Not provided in the content Group 2: Report's Core View - The report focuses on the history, current situation, and future prospects of China's central bank's treasury bond trading. It analyzes the operations and impacts of treasury bond trading in 2024 and 2025, draws lessons from overseas central banks' bond - buying practices, and discusses the future evolution of China's treasury bond trading tool [9] Group 3: Summary by Related Catalogs 1. Treasury Bond Trading History Review - **Before 2024**: The central bank mainly participated in treasury bond trading through repurchase agreements to inject short - term liquidity. It rarely directly bought treasury bonds, and the few purchases were mainly to support special treasury bond issuance [10] - **In 2024**: The central bank started to include treasury bond trading in open - market operations. It conducted "buy - short and sell - long" operations, with a net purchase of 100 billion yuan in August. The operations aimed at liquidity management and curve regulation [19][20] - **In the first half of 2025**: The central bank suspended open - market treasury bond purchases in January. The reasons included controllable government bond supply pressure, the availability of alternative tools, and the need to avoid strong market expectations. In June, market discussions about restarting the operation emerged, but it did not happen [28][32] 2. Overseas Insights on Central Bank Bond - Buying - **Fed's "Scarce Reserves" Framework**: Before 2008, the Fed used this framework. Treasury bond trading was a liquidity management tool, and small - scale trading could affect the federal funds rate and other interest rates [39] - **Fed's Bond - Buying with QE and Twist Operations**: From 2008 - 2014, the Fed used large - scale asset - purchase programs and twist operations to influence the yield curve and long - term interest rates [52][53] - **BOJ's YCC Practice**: Since 1999, Japan has implemented QE. In 2016, it introduced YCC to control the yield curve more precisely, aiming to achieve inflation targets and address negative impacts of previous policies [55][57] 3. Outlook on Central Bank Bond - Buying - **Current Situation**: China's central bank holds a relatively low proportion of treasury bonds compared to the Fed and the BOJ. Commercial banks are the main holders of Chinese treasury bonds [63] - **Reasons for the Difference**: The short implementation time of treasury bond trading in China, different tool positioning, and limited treasury bond liquidity are the main reasons [76] - **Future Deduction**: In operation, there may be more expectation management. The tool will focus on liquidity management and curve regulation. The restart window may be around August - September. There will also be optimization of supporting measures [81][83][84]

Investment Rating - The industry rating is Neutral (maintained rating) [5] Core Viewpoints - In Q2 2025, the proportion of public funds holding basic chemical stocks slightly decreased, with a market value allocation of 3.26%, down 0.46 percentage points year-on-year and 0.09 percentage points quarter-on-quarter [2][12] - The market value of basic chemical stocks in A-shares accounted for 3.49%, a decrease of 0.07 percentage points year-on-year and 0.04 percentage points quarter-on-quarter, indicating a low allocation of 0.23% in the basic chemical industry [2][12] - The number of stocks held by public funds in the basic chemical sector has increased, with 154 stocks held as of Q2 2025, an increase of 21 stocks year-on-year and 7 stocks quarter-on-quarter [3][18] Summary by Sections 1. Event - Public funds are required to disclose their top ten heavy stocks within 15 days after the end of each quarter, with complete holdings disclosed within 60 days after the end of the half-year [11] 2. Sector Holding Changes - The holding proportion of basic chemical stocks by public funds decreased slightly in Q2 2025, with a market value allocation of 3.26% [2][12] - The holding proportion of petrochemical stocks has shown a clear upward trend since Q3 2020, reaching a peak of 1.17% in Q1 2024, but fell to 0.38% in Q2 2025 [2][16] 3. Individual Stock Changes - The top five heavy stocks in Q2 2025 are Juhua Co., Sailun Tire, Hualu Hengsheng, Guangdong Hongda, and Wanhua Chemical, with Guangdong Hongda replacing Satellite Chemical in the top five [4][25] - The number of public funds holding leading stocks in the chemical sector has decreased, with a shift towards small and mid-cap stocks [5][27] 4. Market Preference Analysis - The market value of stocks with a market capitalization of over 500 billion accounted for 25.22% of the total market value of the top 50 chemical stocks, down 8.51 percentage points [5] - The number of funds holding leading stocks like Huafeng Chemical and Xinzhou Bang has increased, while those holding Wanhua Chemical and Hualu Hengsheng has decreased [5][27]

Investment Rating - Industry rating is maintained at "Outperform" [1] Core Viewpoints - The report highlights that the retail trade sector is experiencing a significant transformation, shifting from channel-driven growth to product upgrade-driven growth, indicating a long-term change in industry dynamics [5] - The company "Lao Pu Gold" is identified as a high-growth brand with strong brand influence, which has led to substantial revenue growth in the first half of 2025 [5][6] - The report emphasizes the importance of new store openings and channel optimization for revenue and net profit support in the second half of 2025 [4][5] Summary by Sections Sales Performance - Estimated sales revenue for the first half of 2025 is approximately 13.8-14.3 billion RMB, representing a year-on-year growth of about 240%-252% [6] - Revenue is projected to be around 12-12.5 billion RMB, with a year-on-year increase of approximately 241%-255% [6] - Adjusted net profit is expected to be around 2.3-2.36 billion RMB, reflecting a year-on-year growth of about 282%-292% [6] Brand Expansion - Lao Pu Gold's first overseas store opened in Singapore's Marina Bay Sands, marking a significant step in international expansion [4] - The brand's influence is expected to continue growing, supported by new product launches and a strong performance in key urban markets [5][6] Market Dynamics - The report suggests that companies with differentiated products are likely to outperform in the evolving market landscape, with Lao Pu Gold, Chao Hong Ji, and others being highlighted as key players [5]

Group 1: Report Industry Investment Rating - No information provided in the given content Group 2: Core Viewpoints of the Report - Bond Southbound Connect is about to be expanded. In the situation of "asset shortage", the influx of non-bank funds into Chinese overseas bonds may increase the demand for Chinese overseas bond varieties to some extent. The report focuses on the overview of Bond Southbound Connect, the performance of Chinese overseas bonds in H1 2025, and the opportunities for Chinese overseas bonds in H2 2025 under the expansion of Southbound Connect [15] Group 3: Summary According to the Table of Contents 1. Bond Southbound Connect Overview - **Southbound Connect Expansion Policy Support**: In 2025, multiple meetings or events mentioned the expansion of Southbound Connect. Measures include extending settlement time, supporting multi-currency bond settlement, and expanding the scope of eligible domestic investors [15] - **Southbound Connect Concept and Constraints**: "Southbound Connect" allows domestic investors to invest in bonds traded in the Hong Kong bond market. The previous domestic investors were 41 bank - class financial institutions, QDII, and RQDII. The funds can only be used for bond investment, and there are restrictions on investment额度 and scope [20][28][33] - **Southbound Connect Full - Process Mechanism**: The trading method is Request for Quote (RFQ). It adopts a nominal holder system for custody and full "Delivery versus Payment (DVP)" for settlement [37][41][51] 2. Review of Chinese Overseas Bonds in H1 2025: Narrowed Spreads and Relatively Attractive Returns - **Primary Market Changes**: - **Chinese US Dollar Bonds**: The primary issuance improved, with the issuance scale from January to June 2025 reaching $89.4 billion, a 12% year - on - year increase. The issuance interest rate volatility decreased [52] - **Dim Sum Bonds**: The primary issuance slightly contracted, with a 9% year - on - year decrease in the issuance scale from January to June 2025. The issuance interest rates were differentiated [61] - **Secondary Market Performance**: - **Chinese US Dollar Bonds**: The index rose steadily, and the credit spreads continued to repair. The overall return rate as of June 30, 2025, was 4.23% [72] - **Dim Sum Bonds**: Priced against Chinese government bond yields, they followed the narrowing of on - shore credit spreads. As on - shore funds flow in and financing costs decrease, offshore spreads may narrow [82][92] 3. Outlook for Chinese Overseas Bonds in H2 2025: Southbound Connect Expansion Facilitates Layout - **Overview of the Hong Kong Bond Market**: As of the end of 2024, the outstanding scales of Hong Kong dollar bonds, offshore RMB bonds, and G3 currency bonds were $195.5 billion, $173.2 billion, and $565.6 billion respectively. CMU - hosted debt instruments are only a small part of the Hong Kong bond market [99][107] - **Investment Strategy for Chinese US Dollar Bonds**: Driven by the on - shore and offshore spread gap and the continuous implementation of debt resolution policies, urban investment US dollar bonds are expected to continue to perform well, and real estate US dollar bonds will also benefit. The primary supply of investment - grade financial and non - financial sectors is relatively sufficient, and valuations are still attractive [123] - **Investment Strategy for Dim Sum Bonds**: Considering the lock - in cost, Dim Sum Bonds are more cost - effective than Chinese US Dollar Bonds. With the expected influx of Southbound funds, there is a large narrowing space for Dim Sum Bond spreads, so they have high allocation value [7]

Group 1: Domestic Policy Developments - The State Council has initiated measures to gradually implement free preschool education, emphasizing its importance for long-term development and the well-being of families [10][11][12] - The 2025 World Artificial Intelligence Conference highlighted the rapid development of AI technologies and the need for policy support and talent cultivation to enhance product safety and reliability [12][13] - The People's Bank of China and other departments released guidelines to strengthen financial services for rural reforms, aiming to promote comprehensive rural revitalization [24][27] Group 2: International Policy Developments - The 25th China-EU Leaders' Meeting resulted in a joint declaration on climate change, showcasing the commitment to cooperation in addressing global challenges [18][19][20] - The upcoming third round of trade talks between China and the US is set to take place in Sweden, focusing on mutual economic concerns and cooperation [21][22][23] Group 3: Market Analysis - A-shares have shown a slight upward trend, with the CSI 500 and ChiNext indices rising by 3.28% and 2.76% respectively, influenced by positive economic growth and policy encouragement for long-term capital inflow [25][26] - The MSCI China A-share index increased by 2.07% during the last week of July, reflecting a stable market environment [25] - The premium index for AH shares has decreased to below 124 points, indicating a shift in market dynamics [25]

Investment Rating - The industry rating is "Outperform the Market" (maintained rating) [5] Core Viewpoints - The target price range for thermal coal at ports is expected to reach 700-750 RMB/ton by the end of the year [4][24] - The report emphasizes the need to break the coal-electricity deflation spiral, with a focus on controlling production rates to avoid excessive competition [13][16][25] - The coal supply situation is being closely monitored, with a national coal production target of approximately 4.8 billion tons for 2025 [4][21] Summary by Sections Coal Mine Overproduction Inspection - The National Energy Administration has initiated inspections of coal production in eight key provinces to ensure that production does not exceed announced capacities [2][11] - The inspections will assess whether the coal mines' production plans for 2025 exceed the announced capacities by more than 10% [11][12] Inventory Changes - In 2024, the inventory of thermal coal is projected to increase by approximately 28.34 million tons based on major port, pit, and power plant inventories [3][22] - An alternative calculation method suggests that the total inventory increase could be around 92.69 million tons, indicating a significant supply-demand imbalance [3][21] Policy Toolbox and Adjustability - The report discusses the potential for policy adjustments to manage coal production and supply, highlighting the importance of maintaining a balance between production and market prices [4][25] - The report notes that while there may not be nationwide overproduction, certain regions may still face issues due to high capacity utilization [21][23] Market Dynamics - The report indicates that the market has begun to self-correct, with thermal coal prices rebounding after hitting a low in mid-June 2025 [21] - The coal industry's current dynamics suggest that controlling production rates is crucial to avoid a deflationary spiral in coal prices [16][25]

Investment Rating - The report assigns a "Buy" rating for the company with a target price of HKD 11.52, based on a current price of HKD 8.85 [3]. Core Insights - The company is positioned as a leading technology product channel developer and solution integrator in the Asia-Pacific region, focusing on ICT industry solutions, particularly in enterprise systems, consumer electronics, and cloud computing. The company is expected to benefit significantly from the dual drivers of AI and cloud services, alongside the expansion in Southeast Asia [1][10]. - Revenue is projected to grow from HKD 637 billion in 2020 to HKD 811 billion in 2024, representing a year-on-year growth of 20.6%. Net profit is expected to increase from HKD 8.3 billion in 2023 to HKD 9.58 billion in 2024, a growth of 14.09% [1][3]. - The company has a strong cash flow performance, with operating cash flow expected to rise to HKD 16.59 billion in 2024, reflecting a significant year-on-year increase of 185% [1][28]. Summary by Sections 1. Company Overview - The company has established itself as a top player in the ICT distribution sector, with a diversified business model that includes enterprise systems, consumer electronics, and cloud computing services. It has been recognized in the Fortune China 500 for five consecutive years [10][11]. 2. Market Growth Drivers - The global ICT market is projected to grow from approximately USD 5.3 trillion in 2024 to USD 6.9 trillion by 2028, with a CAGR of 7%. The Chinese ICT market is expected to grow from USD 626 billion in 2024 to USD 751.76 billion by 2028, with a CAGR of 6.5% [1][30]. - The demand for generative AI is driving significant growth in the ICT sector, particularly in GPU servers, AI chips, and cloud infrastructure investments [1][31]. 3. Southeast Asia Focus - The company has strategically positioned itself in Southeast Asia, where the data center market is experiencing rapid growth. By the end of 2024, Southeast Asia is expected to become the third-largest market for new computing capacity globally [2][56]. - The company has established a robust presence in nine Southeast Asian countries, with significant market shares in Thailand, Singapore, Indonesia, the Philippines, and Malaysia [2][68]. 4. Financial Projections - Revenue forecasts for 2025-2027 are projected at HKD 1,037 billion, HKD 1,296.26 billion, and HKD 1,555.51 billion, respectively, with corresponding growth rates of approximately 28%, 25%, and 20% [3][4]. - Net profit estimates for the same period are HKD 12.51 billion, HKD 15.32 billion, and HKD 18.83 billion, with growth rates of 30%, 22.4%, and 22.9% [3][4]. 5. Cash Flow and Operational Efficiency - The company demonstrates strong operational efficiency, with inventory turnover days at 46 and accounts receivable turnover days at 74. The overall operational turnover days are only 52, indicating effective cash management [28].

Investment Rating - The report maintains an "Accumulate" rating for the company [6] Core Views - The company experienced a revenue decline of 13.75% year-on-year in H1 2025, with total revenue of 1.776 billion and a net profit attributable to shareholders of 0.95 billion, down 39.54% year-on-year [1] - The company is transitioning from a traditional design institute to a "think tank technology enterprise," focusing on new fields such as low-altitude economy and green low-carbon initiatives, which have shown over 100% growth [2][3] - The company has established a complete low-altitude economic product system, including three core platforms for airspace service management, low-altitude regulatory services, and AI-integrated inspection [3] Financial Performance - In H1 2025, the company's gross margin was 31.9%, an increase of 1.93 percentage points year-on-year, while the net profit margin was 5.21%, a decrease of 2.55 percentage points year-on-year [4] - The company plans to distribute a cash dividend of 25.26 million (including tax) for H1 2025, with a dividend payout ratio of 26.48% [1] - The projected net profit for the company from 2025 to 2027 is estimated to be 2.1 billion, 2.3 billion, and 2.6 billion respectively, with corresponding P/E ratios of 58, 52, and 47 [1] Business Segments - The engineering consulting business generated revenue of 1.714 billion in H1 2025, down 7.82% year-on-year, while the engineering contracting business saw a significant decline of 69.1%, with revenue of 0.62 billion [2] - Domestic and overseas revenues for H1 2025 were 1.424 billion and 0.352 billion, respectively, with domestic revenue down 17.14% and overseas revenue up 3.35% year-on-year [2] Future Outlook - The company is expected to face significant pressure in the traditional surveying and design industry, but the growth in emerging businesses such as urban lifelines and multimodal transport is promising [2][3] - The company aims to enhance its cash flow management, with a net cash outflow of 690 million in H1 2025, which is a reduction of 33 million year-on-year [4]

Investment Rating - The report assigns a "Buy" rating for stocks, indicating an expected relative return of over 20% within six months [27] Core Insights - The report highlights the continuous inflow of southbound funds into the Hong Kong market, with a net purchase of 295.66 billion CNY over the past week and a total of 7654.18 billion CNY year-to-date, surpassing the total net purchase of 7440.31 billion CNY for the entire year of 2024 [1][19] - The AI sector is experiencing significant advancements, with the launch of Alibaba's Qwen3-Coder, which features a 480 billion parameter model that achieves state-of-the-art results in various coding tasks, and Tencent's CodeBuddy AI IDE, enhancing development efficiency [2][8] - The smart driving industry is seeing a pivotal moment with new software updates from Tesla and the launch of new models from domestic manufacturers like Li Auto and Xpeng, indicating a positive market outlook [3] - The report emphasizes the high growth potential in the IP economy sector, suggesting investment in new consumer companies and key players in the IP space [4] Summary by Sections AI Sector - The 2025 World Artificial Intelligence Conference showcased over 800 companies and 3000 cutting-edge exhibits, including numerous large models and AI products, indicating robust industry growth [2][9] - Alibaba's Qwen3-Coder model supports extensive context and achieves superior performance compared to open-source models [7] - Tencent's CodeBuddy AI IDE integrates leading international and domestic models, streamlining the development process [8] Smart Driving - The report notes the trend of major manufacturers adopting laser radar technology, with a focus on leading companies like Xpeng and Li Auto, and suggests monitoring related technology providers [3][4] Consumer and IP Economy - The report identifies high-growth opportunities in the consumer sector, particularly in companies like Pop Mart and Blokus, which are expected to benefit from seasonal demand and new product launches [5] - The IP economy is highlighted as having strong growth potential, with recommendations to invest in various IP-related companies and sectors [4]