Investment Rating - The industry investment rating is "Outperform the Market," indicating that the industry index is expected to perform better than the benchmark index over the next 6-12 months [10]. Core Insights - The report highlights that China Unicom has taken the lead in enhancing computing power, fully embracing AI, and is expected to undergo a value reassessment due to its technological transformation [1]. - The AI wave is anticipated to significantly benefit telecom operators from the growth in intelligent computing business and value reassessment, with a recommendation to focus on the three major operators: China Mobile, China Telecom, and China Unicom [3]. - The report emphasizes that the intelligent computing business has become a crucial driver of revenue growth for China Unicom, with a projected revenue of RMB 389.6 billion in 2024, reflecting a year-on-year increase of 4.6% [5]. Summary by Sections Investment Recommendations - The report suggests that telecom operators will benefit from the intelligent computing business, leading to revenue growth and value reassessment, recommending attention to the three major operators: China Mobile, China Telecom, and China Unicom [3]. Performance Metrics - China Unicom's revenue for 2024 is projected to be RMB 389.6 billion, a 4.6% increase year-on-year, with a total profit of RMB 25.1 billion and a net profit of RMB 9 billion, up 10.5% year-on-year [5]. - The intelligent computing business revenue accounted for 24% of service revenue, growing by 9.6% year-on-year, while cloud revenue reached RMB 68.6 billion, up 17.1% year-on-year [5]. Capital Expenditure Trends - China Unicom's capital expenditure for 2024 is expected to be RMB 61.37 billion, a decrease of 17% year-on-year, while computing power investment is projected to increase by 19% [5]. - The company plans to further reduce fixed asset investment to RMB 55 billion in 2025, a decline of 10.38%, while continuing to increase computing power investment by 28% [5]. Industry Landscape - The report notes that the three major telecom operators are increasing their computing power infrastructure, with a total of 830,000 data center racks and a computing power scale exceeding 50 EFLOPS, doubling year-on-year [5]. - The demand for AI computing is expected to reshape the industry, transitioning telecom operators from traditional network providers to technology service companies, which may lead to a value reassessment [5].

Investment Rating - The industry investment rating is "Outperform the Market," indicating that the industry index is expected to perform better than the benchmark index over the next 6-12 months [14]. Core Insights - The recent issuance of the "Special Action Plan to Boost Consumption" by the central government is expected to stimulate travel demand, particularly benefiting the regional aviation sector, especially in areas with unique tourism resources [1]. - The report suggests focusing on the leading regional airline, Huaxia Airlines, which holds a significant market share [3]. Summary by Sections Industry Overview - Over 70% of domestic airports in China are regional airports, yet they account for only 6% of passenger throughput. Regional aviation refers to short-distance, non-mainline routes between small and medium-sized cities, typically using aircraft with fewer than 110 seats and flying distances of 600-1200 kilometers [5]. - In 2024, there are 263 transport airports in mainland China, with 186 airports having an annual passenger throughput of less than 2 million, representing 70.72% of the total. These airports collectively handled 90.49 million passengers, accounting for only 6.2% of total civil aviation throughput [5]. Market Dynamics - Passenger throughput at regional airports has remained stable at around 90 million over the past five years. The throughput figures from 2019 to 2024 are 92.49 million, 94.16 million, 96.92 million, 71.94 million, 88.72 million, and 90.49 million respectively [8]. - In 2024, regional airports are expected to handle nearly 1 million takeoffs and landings, representing about 9.5% of total domestic airport operations, with a year-on-year growth of 3.8% [5]. Regional Distribution - Regional airports are distributed across 28 provinces in China, covering over 170 cities. The top three regions with the most regional airports are Southwest (41), Northwest (41), and Central South (29) [5]. - The report highlights that the current regional aviation demand is primarily concentrated in the central and western regions, which are rich in tourism resources. The government's new consumption plan is expected to enhance travel demand in these areas [5]. Competitive Landscape - In 2024, Huaxia Airlines leads the regional aviation market with a market share of 13.4%. The top ten airlines in the regional aviation market include China Eastern Airlines (12.9%), Southern Airlines (10.6%), and others, with the top ten airlines collectively holding 69.3% of the market [5][7].

Investment Rating - The report maintains a "Buy" rating for the company [1][5] Core Views - The company achieved a significant improvement in profitability in 2024, with total revenue reaching USD 10.259 billion, a year-on-year increase of 15.9%, driven by strong global parcel volume growth [8] - Adjusted EBITDA rose to USD 778 million, reflecting a substantial increase of 430.5%, indicating enhanced profitability [8] - The company turned a profit with a net income of USD 114 million in 2024, compared to a loss of USD 1.156 billion in 2023 [8] - The report highlights the continued improvement in domestic business profitability and the ongoing increase in overseas market share [5] Financial Performance Summary - The company’s revenue is projected to grow from RMB 63.056 billion in 2023 to RMB 109.376 billion by 2027, with a compound annual growth rate (CAGR) of approximately 13% [7] - The adjusted EBITDA is expected to improve significantly from a loss of RMB 4.107 billion in 2023 to a profit of RMB 11.567 billion by 2027 [7] - The net profit is forecasted to increase from a loss of RMB 7.845 billion in 2023 to RMB 6.341 billion by 2027, representing a growth rate of 240.1% in 2025 [7] - Earnings per share (EPS) are expected to rise from a loss of RMB 0.88 in 2023 to RMB 0.71 by 2027 [7] Market and Operational Insights - The company’s global parcel volume reached 24.65 billion pieces in 2024, marking a year-on-year growth of 31.0% [8] - The Southeast Asia market remains a core area, with parcel volume reaching 4.56 billion pieces and a market share increase to 28.6% [8] - In China, parcel volume reached 19.8 billion pieces, with a market share of 11.3%, ranking sixth in the industry [8] - The company has made strategic price adjustments to expand its market share in Southeast Asia, which has slightly impacted single-ticket revenue but has improved cost efficiency [8]

Investment Rating - The report rates the real estate industry as "Outperform" compared to the market [19]. Core Insights - In February 2025, the average new home price in 70 major cities decreased by 0.1% month-on-month, while the average second-hand home price fell by 0.3% month-on-month. The number of cities experiencing price declines has increased [3][10]. - The report emphasizes that the current trend of "stabilizing after a decline" remains unchanged, with the primary task being to stimulate demand in the industry. The effectiveness of policies to boost demand is diminishing, and the market's recovery will depend on further easing measures and the progress of debt monetization and land reserve strategies [3][10]. Summary by Sections Price Trends - In February 2025, 45 out of 70 cities saw new home prices decline, with an average drop of 0.31%, while 65 cities experienced a decrease in second-hand home prices, averaging a drop of 0.38% [3][10]. - First-tier cities showed a mixed trend, with new home prices increasing by 0.1% month-on-month, while second-hand home prices fell by 0.1% after four months of growth [3][11]. - Second-tier cities saw new home prices stabilize, while second-hand home prices decreased by 0.4%, indicating a widening decline [3][11]. - Third-tier cities experienced a 0.3% decline in new home prices, while second-hand home prices fell by 0.4%, with the decline in new home prices being less severe compared to previous months [3][11]. Investment Recommendations - The report suggests focusing on four main lines of investment: 1. Companies with stable fundamentals and high market share in core cities, such as Greentown China and China Resources Land [3]. 2. Smaller companies that have made significant breakthroughs in sales and land acquisition since 2024, like Poly Real Estate [3]. 3. Companies with operational or strategic changes benefiting from local government debt relief, such as Gemdale Corporation [3]. 4. Real estate brokerage firms benefiting from the recovery in the second-hand housing market, including Beike and Wo Ai Wo Jia [3].

Investment Rating - The industry investment rating is "Outperform the Market," indicating that the industry index is expected to perform better than the benchmark index over the next 6-12 months [27]. Core Views - The sales momentum in the real estate sector has weakened, with a notable decline in both sales area and investment amounts in January and February 2025. The sales area decreased by 5.1% year-on-year, while the development investment amount fell by 9.8% [1][2]. - The average selling price of commercial housing has significantly dropped, with the average price in January and February 2025 at 9,547 yuan per square meter, a decrease of 7.5% from December 2024 [2][6]. - The report anticipates a potential recovery in market demand in March 2025, driven by increased supply from developers and a shift towards higher-end properties [2]. Summary by Sections Sales Performance - In January and February 2025, the total sales area was 107 million square meters, down 5.1% year-on-year, with a sales amount of 1.03 trillion yuan, a decrease of 2.6% [2][12]. - Residential sales area fell by 3.4%, and sales amount decreased by 0.4%, indicating a decline in market activity [2]. - The average selling price for residential properties was 9,949 yuan per square meter, reflecting an 8.1% drop from December 2024 [2][6]. Inventory Situation - The broad inventory of commercial housing reached 1.75 billion square meters by the end of February 2025, with a decrease of 1.2% from December 2024 but a year-on-year decline of 14.4% [5]. - The current housing inventory is at its highest level since August 2016, with a current inventory of approximately 432 million square meters [5]. Investment and Construction - Development investment in January and February 2025 was 1.07 trillion yuan, down 9.8% year-on-year, with new construction area at 66.14 million square meters, a decline of 29.6% [5][8]. - The report notes that the decline in investment is primarily due to reduced land purchases and high inventory levels, with new construction expected to continue to decline [5]. Developer Financing - Funds available to real estate companies decreased by 3.6% year-on-year, totaling 1.56 trillion yuan in January and February 2025 [5][15]. - The report highlights a decline in sales receipts, with housing sales down 4.4% and personal mortgage loans down 11.7% [5][19]. 2025 Core Indicators Forecast - The report predicts a continued decline in new housing sales in 2025, with expected year-on-year decreases of 9% in sales area and 12% in sales amount [5]. - New construction and investment are also forecasted to decline, with new construction area expected to decrease by 16% [5]. Investment Recommendations - The report suggests focusing on companies with stable fundamentals in core cities, those that have made significant breakthroughs in sales and land acquisition, and companies benefiting from local government debt relief [5].

Investment Rating - The report rates the transportation industry as "Outperforming the Market" [1] Core Insights - In February, China regained the top position in global new ship orders, with a market share of 93.7%, totaling 52 new ships and 621 million deadweight tons [1][13] - Air China launched a direct flight from Beijing to Washington, with over 1 million passengers passing through Beijing Daxing International Airport, marking a 36.1% year-on-year increase [1][15][16] - Jitu Express integrated the DeepSeek AI model, with the Chinese express delivery index reaching 368.6 in January and February, reflecting an 11.8% year-on-year increase [1][21][23] Industry Hot Events - February saw China’s new ship orders return to the global lead, with a total of 69 ships and 663 million deadweight tons ordered, a 117.4% increase from January [13] - Air China’s direct flight service from Beijing to Washington commenced on March 14, enhancing international travel efficiency [15][16] - Jitu Express's integration of the DeepSeek model aims to improve operational efficiency and reduce training costs [21][22] Industry High-Frequency Data Tracking - In February, express delivery volume increased by 58.75% year-on-year, with revenue rising by 16.26% [2][40] - The average daily international flights in the second week of March reached 1,631.57, a 20.27% year-on-year increase [2][67] - The shipping price index (SCFI) decreased by 30.04% year-on-year, while the dry bulk index (BDI) increased by 11.60% week-on-week [2][31][34] Investment Recommendations - The report suggests focusing on the equipment and manufacturing export chain, recommending companies like COSCO Shipping Specialized, China Merchants Energy Shipping, and Huamao Logistics [3] - It highlights investment opportunities in the low-altitude economy, recommending CITIC Offshore Helicopter [3] - The report also suggests looking into the cruise and ferry sectors, recommending Bohai Ferry and Straits Shares [3]

Economic Performance - In January-February 2025, industrial added value increased by 5.9% year-on-year, exceeding the expected 5.1%[4] - Fixed asset investment grew by 4.1% year-on-year, surpassing the expected 3.8%[29] - Social retail sales increased by 4.0% year-on-year, slightly below the expected 4.5%[29] Sector Analysis - High-tech industries saw a significant growth in industrial added value, with a year-on-year increase of 9.1%[4] - Manufacturing investment rose by 9.0% year-on-year, while real estate investment fell by 9.8%[21] - Service consumption grew by 4.9% year-on-year, driven by strong performance in food and beverage sectors during the Spring Festival[13] Investment Trends - Fixed asset investment in infrastructure increased by 5.6% year-on-year, indicating a positive trend in government spending[21] - Real estate investment showed signs of marginal improvement, with a reduction in the rate of decline compared to 2024[24] - The contribution of net exports to GDP was 30.3% in 2024, highlighting the importance of external demand[30] Risks and Outlook - Global inflation and rapid economic downturns in Europe and the US pose significant risks to domestic growth[31] - The economic growth target for 2025 remains at 5%, requiring a multi-faceted approach to stabilize growth[30] - Anticipated monetary policy easing before May 2025 aims to mitigate the impact of external demand fluctuations[30]

Core Viewpoints - The report highlights the steady profit growth of Kunming Pharmaceutical Group in 2024, with a strong performance in the fourth quarter. The company's channel integration is nearing completion, and improvements in quality and efficiency are anticipated [4][5]. Financial Performance - In 2024, Kunming Pharmaceutical Group achieved an operating revenue of 8.401 billion yuan, a year-on-year decline of 0.34% (adjusted for retrospective changes, a growth of 9.07%). The net profit attributable to shareholders was 648 million yuan, representing a year-on-year increase of 19.86% (adjusted for retrospective changes, a growth of 45.74%). The net profit excluding non-recurring gains and losses was 419 million yuan, up 25.09% year-on-year [4]. - In the fourth quarter, the company reported a single-quarter revenue of 2.944 billion yuan, a year-on-year growth of 4.42%. The net profit attributable to shareholders for the fourth quarter was 261 million yuan, showing a significant year-on-year increase of 68.51 [4]. Cost Management - In 2024, the sales expense ratio was 26.50%, a decrease of 4.82 percentage points year-on-year. The management expense ratio was 4.42%, an increase of 0.35 percentage points year-on-year. The R&D expense ratio was 1.27%, up 0.15 percentage points year-on-year [4]. Strategic Developments - The completion of the acquisition of 51% of Kunming Huaren Shenghuo Pharmaceutical is a key move for the company to address competition with Huaren Sanjiu. This acquisition allows for further resource integration in the health sector and aims to enhance the market share of the company's products [5]. - The company is advancing its strategy of "big products + all channels + branding," with significant progress in integrating retail and medical system channels across the country. This integration is expected to continue to enhance quality and efficiency [5]. - In 2024, the company invested 143 million yuan in R&D, employing a model of "independent research + investment mergers + cooperative research + introduction of agents" to establish an innovative R&D pipeline covering key areas of elderly health and chronic diseases [5].

Investment Rating - The report indicates a positive outlook for the real estate industry, with a focus on stabilizing the market and boosting demand [1]. Core Insights - The real estate market is showing signs of recovery, with new home sales area turning positive on a month-over-month basis, although the year-over-year growth rate has narrowed [1][5]. - The report highlights the importance of government policies aimed at stabilizing the real estate market, including potential reductions in housing provident fund loan rates and support for housing consumption [5][10]. - The report suggests that the recovery of the market will depend on the continuation of demand-side policies and the progress of urban renewal and land acquisition [5][10]. Summary by Sections New Home Market Tracking - In the week of March 8 to March 14, 2025, new home transaction area in 40 cities was 2.383 million square meters, a month-over-month increase of 7.0% and a year-over-year increase of 15.9% [11][21]. - The transaction volume for new homes in first, second, and third/fourth-tier cities showed varying growth rates, with first-tier cities experiencing a significant year-over-year increase of 39.2% [11][18]. Second-Hand Home Market Tracking - The second-hand home transaction area in 18 cities was 215.8 million square meters, with a month-over-month increase of 5.3% and a year-over-year increase of 17.2% [49]. - First-tier cities saw a year-over-year increase of 46.3% in second-hand home transactions, while second-tier cities experienced a slight decline of 0.6% [49][50]. Inventory and Market Dynamics - The new home inventory in 12 cities was 8.921 million square meters, with a month-over-month increase of 0.4% and a year-over-year decrease of 16.2% [38][39]. - The report notes that the inventory turnover period for new homes in first-tier cities is approximately 46.3 months, indicating a need for continued monitoring of market dynamics [25][46]. Land Market Tracking - The land market showed a significant decline, with total land transaction area in 100 cities dropping to 438.0 million square meters, a month-over-month decrease of 74.1% and a year-over-year decrease of 64.0% [7][10]. - The average land price per square meter was reported at 1830.9 yuan, reflecting a month-over-month decrease of 34.8% but a year-over-year increase of 11.8% [7][10]. Policy and Regulatory Environment - Recent government policies aim to support land reserves and stabilize the real estate market, including the issuance of special bonds for local governments [5][10]. - The report emphasizes the need for ongoing policy support to stimulate housing demand and ensure market stability [5][10].

Investment Rating - The report rates the food and beverage industry as "Outperforming the Market" [1] Core Views - Policy stimulus is boosting confidence in the food and beverage sector, leading to a recovery in market sentiment and highlighting investment opportunities in undervalued segments [1][5] - The food and beverage sector saw a weekly increase of 6.2%, ranking second among the Shenwan primary industries, with other alcoholic beverages showing significant gains [2][8] - The introduction of substantial childcare subsidies in Hohhot is expected to benefit the dairy sector, contributing to a notable year-to-date increase in stock prices [5] Market Review - The food and beverage sector's weekly performance was +6.2%, outperforming the CSI 300 index, which was +1.6% [8] - Sub-sectors such as other alcoholic beverages and pre-processed foods led the gains with increases of +8.4% and +7.8%, respectively, while seasoning and fermented products lagged behind with +2.6% and +1.5% [2][11] - As of March 14, the valuation of the liquor sector (PE-TTM) was 21.2X, while the overall food and beverage sector was at 22.1X [19] Industry Data - The average price of fresh milk in China was 3.08 RMB/kg as of March 7, showing a month-on-month decrease of 0.3% and a year-on-year decrease of 13.5% [38] - The price of live pigs was 7.42 RMB/jin as of March 14, reflecting a week-on-week increase of 0.8% and a year-on-year increase of 0.3% [42] - The report highlights the significant impact of government policies aimed at boosting birth rates and consumer spending, which are expected to positively influence the food and beverage sector [5][50]