Investment Rating - The investment rating for the company is "Buy" with a target price not specified [4] Core Views - The company achieved a turnaround in Q2, reporting a net profit of 0.1 billion yuan, marking a significant recovery compared to the previous year, driven by cost reduction and efficiency improvements [1] - The company is expected to benefit from the acceleration of domestic innovation and the high demand in cross-border payment services, leading to rapid growth in annual performance [2] - The issuance of convertible bonds indicates confidence in achieving a minimum net profit of 0.7 billion yuan for 2025, reinforcing the positive outlook for the company's performance [3] Financial Performance Summary - In H1 2025, the company reported revenue of 1.98 billion yuan, a year-on-year increase of 6.7%, with significant growth in the government sector [1] - Q2 revenue reached 1.23 billion yuan, up 6.86% year-on-year, with a net profit of 0.21 billion yuan, indicating a strong recovery [1] - The company expects revenues of 5.77 billion yuan, 6.84 billion yuan, and 8.13 billion yuan for 2025, 2026, and 2027 respectively, with net profits projected at 1.19 billion yuan, 1.83 billion yuan, and 2.22 billion yuan [3] Financial Data and Valuation - The company’s financial metrics for 2023 to 2027 include projected revenues of 549.23 million yuan in 2023, declining to 500.56 million yuan in 2024, before recovering to 576.51 million yuan in 2025 [8] - The net profit is expected to fluctuate from 11.22 million yuan in 2023 to a loss of 47.82 million yuan in 2024, before rebounding to 118.52 million yuan in 2025 [8] - The company’s P/E ratio is projected to improve from 415.71 in 2023 to 21.02 by 2027, indicating a potential increase in profitability [8]

Group 1: Report Industry Investment Rating - Not provided in the content Group 2: Core View of the Report - In August, the capital market experienced a "roller - coaster" with multiple factors causing an unexpected tightening of funds, but the central bank's timely intervention stabilized the situation. In September, seasonal disturbances will increase, and non - seasonal factors may also have an impact. However, the capital market is expected to maintain a reasonably abundant state with support from fiscal expenditures and the central bank [1][4] Group 3: Summary According to the Directory 1. August, the "Roller - Coaster" of Funds 1.1 Review: Characteristics of the August Capital Market - **Interest rate volatility**: Interest rates changed from "low - level and low - volatility" to a "roller - coaster" pattern. In the first half of August, rates were low and stable, while in the middle, they rose rapidly due to tax payments and bond fund redemptions. After the central bank's intervention, rates gradually declined [9] - **Deviation between expectation and reality**: Despite non - traditional tax - heavy months and more precise central bank operations, the capital market tightened unexpectedly in the middle of August, mainly due to the resonance of tax payments and bond fund redemptions [12] - **Central bank support**: The central bank increased short - and long - term liquidity injections. Short - term liquidity was promptly supplemented, and long - term net investment reached 60 billion yuan, second only to January [16] - **Change in lending entities**: The willingness of large banks to lend decreased, while money market funds and wealth management products took over as lending entities due to higher lending rates [20] 1.2 Focus: Reasons for the Unexpected Tightening of Funds - **Stock market impact**: The strength of the stock market led to capital occupation and diversion. North Exchange new - share subscriptions froze funds, and the rise of the stock market drove asset reallocation, causing some deposits to flow into the stock market, which affected large banks' lending willingness [23] - **Fund redemption pressure**: Bond market "negative feedback" concerns increased, leading to large - scale bond sales by funds, which raised liquidity premiums and further tightened the capital market [36] 2. Re - encountering the Quarter - End: Similarities and Differences - **Historical September pattern**: Historically, in September, capital interest rates generally trended upwards with increased volatility in the second half of the month. Seasonal factors such as banks' end - of - quarter liquidity needs and cash reserve requirements for holidays increased, while fiscal expenditures at the end of the month provided support [37] - **This year's September situation**: In addition to seasonal factors, non - seasonal factors such as the strength of the equity market, more prominent end - of - quarter credit impulse, large - scale government bond supply, and the maturity of medium - and long - term liquidity and certificates of deposit may also affect the capital market. However, the capital market in the first half of September is expected to be balanced and loose, and the disturbances in the second half are controllable [4][50]

Group 1 - The report highlights the volatility in the bond market during August, with institutions exhibiting varied behaviors, transitioning from a "stock-driven bond" approach to a "desensitized stock-bond" narrative [1][3][8] - In early August, the bond market experienced a brief respite, with institutions showing cautious trading behavior while awaiting the release of new tax-inclusive bonds. The buying power for credit bonds from funds returned to levels seen in June [1][8] - Mid-August saw a surge in the equity market, leading to increased concerns about bond fund redemptions, with significant net selling observed from trading desks [1][9] Group 2 - The report indicates that the behavior of funds has evolved through various stages, from unified selling to differentiated strategies, ultimately leading to a "desensitized" market where bond prices are less influenced by stock movements [3][35][36] - The report notes that the bond market is currently in a phase where the configuration of funds is limited, particularly as long-term bonds are being heavily issued, which may reduce participation in the secondary market [2][15] - The report emphasizes the need to monitor potential redemption pressures on funds and the risks associated with continued portfolio adjustments, especially if the equity market experiences a downturn [4][43][44]

Core Insights - The report emphasizes a bullish market sentiment, suggesting that investors should maintain high positions and accumulate during dips as long as the market's profitability remains positive [1][2][3] - The current trend line for the WIND All A index is around 5926 points, with a profitability effect value of 4.2%, indicating a strong positive sentiment [2][10] - The report recommends focusing on sectors that are likely to benefit from policy support, including innovative pharmaceuticals, securities insurance, chemicals, and new energy technologies [2][10] Market Overview - The market is in an upward trend, with the short-term moving average (20-day) at 5884 points and the long-term moving average (120-day) at 5310 points, showing a widening gap of 10.81% [2][9] - The profitability effect has been positive, with a previous value of 5.22% and a recent value of 4.2%, suggesting continued market interest and potential for new capital inflows [1][10] - The report notes that small-cap stocks (represented by the CSI 2000) decreased by 0.78%, while mid-cap (CSI 500) and large-cap stocks (CSI 300 and SSE 50) showed increases of 3.24%, 2.71%, and 1.63% respectively [1][9] Sector Recommendations - The report continues to recommend sectors that are in a turnaround phase, specifically highlighting innovative pharmaceuticals and securities insurance as key areas for investment [2][10] - Additionally, sectors driven by policy support, such as chemicals and new energy technologies, are expected to maintain an upward trajectory [2][10] - The TWO BETA model suggests a focus on technology sectors, particularly in AI applications, computing power, and battery technologies [2][10] Valuation Metrics - The overall PE ratio for the WIND All A index is around the 85th percentile, while the PB ratio is at the 50th percentile, indicating a moderate valuation level [3][10] - Based on the current market conditions, the report advises maintaining an 80% allocation in absolute return products based on the WIND All A index [3][10]

Group 1: Market Insights - The report discusses how to characterize the main line and subsequent space of the bull market using indicators, emphasizing that high trading volume indicates the market is trading the core main line and reflects market divergence [10][11]. - The main line profit effect index has shown significant upward movement recently, with a notable increase of 11% on August 28, 2025, and a total increase of 47% over the current trading cycle [10][11]. - Historical bull markets have phases where focus on the main line occurs, with the head crowding degree indicator reaching the 50% threshold in previous cycles [10][13]. Group 2: Domestic Economic Indicators - In July, the profit growth rate of industrial enterprises showed a narrowing decline, with a year-on-year decrease of 1.50%, and cumulative profit for the first seven months was -1.70%, improving from -1.80% [21][23]. - The inventory cycle remains low, with finished goods inventory at 6.67 trillion yuan, and the growth rate of finished goods inventory has shown a downward trend [21][28]. - The profit margin for public utilities has improved slightly, with the profit margin for public utilities at 6.92%, up by 0.13 percentage points from the previous month [28][30]. Group 3: International Economic Indicators - The U.S. core PCE price index for July met market expectations, with a year-on-year increase of 2.9% and a month-on-month increase of 0.3% [44]. - The probability of the Federal Reserve lowering interest rates by 25 basis points in September 2025 is 86.4%, while the probability of maintaining the current rate is 13.6% [44][46]. Group 4: Industry Allocation Recommendations - The report suggests focusing on three investment directions: breakthroughs in technology AI led by Deepseek, valuation recovery in consumer stocks, and the continued rise of undervalued dividends [48]. - The report highlights the importance of the AI industry trend's progress, which is influenced by breakthroughs in both application and consumption sectors [48].

Report Summary 1. Industry Investment Rating The provided content does not mention the industry investment rating. 2. Core View In August, the PMI data showed a combination of "manufacturing at the bottom and non - manufacturing moderately recovering". Compared with the "double - weak" situation in July, the short - term economic downward risk may be alleviated. With the weakening of the impact of high - temperature and rainy weather, the continuous release of policy effects, and the influence of seasonal factors, the economy is expected to continue the recovery trend, and the manufacturing PMI in September is expected to improve month - on - month, which may weaken the downward driving force of long - term interest rates [2][4]. 3. Summary by Related Catalogs August Manufacturing - The manufacturing PMI was 49.4%, up 0.1 percentage points from the previous value, still in the contraction range but showing marginal improvement. The non - manufacturing business activity index was 50.3%, up 0.2 percentage points, continuing to expand. The composite PMI output index was 50.5%, up 0.3 percentage points, indicating an accelerated overall expansion of enterprises' production and business activities [1]. - In terms of supply and demand, the production index was 50.8%, up 0.3 percentage points, with continuous expansion. The new order index was 49.5%, up 0.1 percentage points, with insufficient market demand. The new export order index was 47.2%, up 0.1 percentage points, with foreign demand hovering at a low level [2]. - In terms of prices, the purchase price index of major raw materials was 53.3%, up 1.8 percentage points, rising for three consecutive months and in the expansion range for two consecutive months. The ex - factory price index was 49.1%, up 0.8 percentage points, also rising for three consecutive months and reaching the highest point this year. It is expected that the year - on - year decline of PPI will continue to narrow, and the pressure on industrial product prices may be alleviated [2]. August Non - manufacturing - The service industry business activity index was 50.5%, up 0.5 percentage points, reaching the highest point this year. Industries such as capital market services, railway transportation, and aviation transportation were in a high - level boom range, while industries such as retail and real estate had weak prosperity. The business activity expectation index was 57.0%, up 0.4 percentage points, indicating that service enterprises were optimistic about the market [3]. - The construction industry business activity index was 49.1%, down 1.5 percentage points, in the contraction range, mainly due to the impact of high - temperature and rainy weather. The business activity expectation index was 51.7%, slightly higher than the previous month. Looking forward, with the weakening of the weather impact and the release of policies, the economy may continue to recover, and the manufacturing PMI in September is expected to improve [4].

Investment Rating - The report maintains a "Buy" rating for the company [6][18]. Core Views - The company experienced a 31% year-on-year growth in non-recurring profit for Q2, despite a 20.52% decline in revenue for the first half of 2025 compared to the previous year [1]. - The revenue decline is attributed to weak growth in the construction industry and significant adjustments in the real estate sector [1]. - The company is focusing on the revaluation of mineral resources, with significant potential in its mining projects [2]. Financial Performance - In H1 2025, the company achieved a revenue of 237.53 billion, a decrease of 20.52% year-on-year, with a net profit attributable to the parent company of 3.10 billion, down 25.31% [1]. - The company’s gross profit margin improved to 10.09%, an increase of 1.04 percentage points year-on-year [4]. - The operating cash flow showed a net outflow of 21.99 billion, which is a reduction of 6.42 billion compared to the previous year, indicating improved cash collection efforts [4]. Business Segments - The engineering contracting segment generated 216.91 billion in revenue, down 21.79% year-on-year, while the mining resources segment showed potential with profits from various projects [2]. - The company signed new contracts worth 548.2 billion in H1 2025, a decrease of 19.1% year-on-year, but with a notable increase in overseas contracts by 32.5% [3]. Future Outlook - The company has revised its net profit forecasts for 2025-2027 to 6.15 billion, 6.66 billion, and 7.27 billion respectively, reflecting a cautious outlook [1]. - The ongoing projects in Papua New Guinea and Pakistan are expected to contribute positively to the company's future profitability as copper prices are anticipated to receive support from the Federal Reserve's interest rate cuts [2].

1. Report Industry Investment Rating No information about the industry investment rating is provided in the content. 2. Core View of the Report The report focuses on understanding the current low inflation and providing an outlook for inflation and the bond market in the second half of the year. It points out that the low inflation is mainly due to a negative output gap and high real interest rates, which suppress aggregate demand. Under the "anti - involution" policy, prices are expected to rise moderately at a low level in the second half of the year, with CPI and PPI showing different trends. In the bond market, the "weak recovery, low inflation" environment provides support, but there are also upward pressure on interest rates and uncertainties [1][2][3][5]. 3. Summary According to the Table of Contents 3.1 How to Understand the Current Low Inflation? - **Negative Output Gap**: China's GDP growth rate has a gap with the potential growth rate, the youth unemployment rate is high, industrial capacity utilization is low, and CPI and PPI are running at a low level, indicating that aggregate demand is lower than aggregate supply [2][18]. - **High Real Interest Rates**: Although the central bank has been lowering the nominal interest rate, the real interest rate has risen due to extremely low inflation and GDP deflator, which inhibits aggregate demand and forms a "passive tightening" effect [3][22]. 3.2 Current Characteristics of the Inflation Market - **Widening CPI - PPI Scissors**: In July 2025, the CPI - PPI scissors reached 3.6 percentage points, reflecting problems such as poor price transmission and unbalanced economic recovery, and squeezing the profits of downstream manufacturing enterprises [4][26]. - **Core CPI Reaching a New High**: In July 2025, the core CPI reached a new high since March 2024, becoming the main support for CPI, which shows positive changes in price operation and the effectiveness of policies [4]. - **"Anti - Involution" Not Driving PPI Upward**: "Anti - involution" policies have promoted the rise of commodity futures prices, but PPI has not increased. This may be due to the difference in pricing logic between futures prices and PPI, and the problem of insufficient terminal demand [4][34]. 3.3 Outlook for Inflation and the Bond Market under "Anti - Involution" - **Inflation Outlook**: In the second half of the year, CPI is expected to rise moderately, with estimated year - on - year growth rates of 0.1% and 0.5% in the third and fourth quarters respectively, and around 0% for the whole year. PPI is expected to maintain a trend of volatile recovery with narrowing year - on - year decline, with estimated year - on - year growth rates of - 2.7% and - 1.5% in the third and fourth quarters respectively, and around - 2% for the whole year, with a low possibility of turning positive within the year [5][41][51]. - **Bond Market Outlook**: In the "weak recovery, low inflation" environment, the bond market is supported by the fundamental logic and the central bank's monetary easing. However, the warming of the equity market and the "anti - involution" and "expanding domestic demand" policies may bring upward pressure on the interest rate center. The impact of the "anti - involution" policy on the bond market depends on whether the price increase expectation can be supported by real demand [6][57].

Group 1 - The equity market experienced a significant rise in August, with the TMT sector leading the gains, as the A-share market showed a strong upward trend, breaking through key levels such as 3700 and 3800 points [12][15][26] - The overall performance of the convertible bond market was strong, with the China Convertible Bond Index rising by 7.53% in August, and small-cap convertible bonds outperforming with a 9.15% increase [2][15][28] - The valuation of convertible bonds reached new highs, with the median price exceeding 135 yuan, marking the highest level since 2017, and the median premium rate for bonds priced at 100 yuan reaching 33.05% [2][27][28] Group 2 - The outlook for September indicates a consensus that micro-enterprise profits have bottomed out and stabilized, although the elasticity of earnings recovery faces certain constraints [3][44] - The overall valuation of major A-share indices has risen to historically high levels since 2015, suggesting a mid-term slow bull market trend despite potential fluctuations in September [3][44] - The convertible bond market is expected to see further increases in conversion value, supported by the current market valuations not reaching the historical highs of August 2022 [4][44] Group 3 - The report highlights the importance of focusing on low-priced convertible bonds below 115 yuan and those with a remaining maturity of over 3.5 years in the small and medium-cap sector [4][5] - Specific sectors to watch include transportation, environmental protection, aquaculture, and construction, which are supported by domestic demand policies, as well as industrial gases and photovoltaic sectors showing marginal improvements [4][5] - The report suggests a focus on convertible bonds related to high-growth technology sectors such as semiconductors, AI computing, humanoid robots, and innovative pharmaceuticals, which are expected to have high elasticity and rapid rotation [4][5]

Investment Rating - The report maintains a "Buy" rating for the company [1][6][17] Core Views - The company demonstrated resilient revenue in Q2, achieving a total revenue of 292.76 billion with a year-on-year growth of 2.66%. The net profit attributable to the parent company decreased by 13.81% to 5.43 billion [1] - The company is expected to benefit significantly from the construction of the Yarlung Tsangpo River hydropower project, where it is a major participant [1][4] - The report has adjusted the forecast for the company's net profit for 2025-2027, now estimating 12.05 billion, 13.05 billion, and 14.13 billion respectively, down from previous estimates [1] Revenue Breakdown - In H1 2025, revenue from engineering contracting and surveying design was 265.93 billion, power investment and operation was 12.39 billion, and other businesses contributed 13.56 billion, with year-on-year changes of +3.19%, +1.73%, and -5.42% respectively [2] - The company has a total installed capacity of 35.16 million kilowatts, with wind power, solar energy, hydropower, thermal power, and independent storage capacities showing year-on-year growth of 20.45%, 60.87%, 3.53%, stable, and stable respectively [2] Profitability and Cash Flow - The overall gross margin for H1 2025 was 11.23%, a decrease of 1.04 percentage points year-on-year. The gross margins for engineering contracting, power investment, and other businesses were 8.46%, 45.05%, and 32.25% respectively [3] - The company experienced a net cash outflow of 51.20 billion in H1 2025, which is an increase of 4.57 billion compared to the same period last year [3] Contract and Order Growth - The company signed new contracts worth 686.70 billion in H1 2025, achieving 49.13% of the annual target, with a year-on-year increase of 5.83%. The new contracts in the energy and power sector amounted to 431.39 billion, reflecting a growth of 12.27% [4] - The overseas new contract amount reached 141.67 billion, with a year-on-year increase of 17.5%, indicating sustained high demand in international markets [4] Financial Data and Valuation - The projected revenue for 2025 is 656.97 billion, with a growth rate of 3.53%. The estimated net profit attributable to the parent company for 2025 is 12.05 billion, with an EPS of 0.70 [5][11] - The company’s P/E ratio is projected to be 8.46 for 2025, while the P/B ratio is expected to be 0.58 [5][11]