Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company's revenue for 2025 is projected to be 85.882 billion yuan, representing a year-on-year growth of 1.64%. The net profit attributable to shareholders is expected to be 34.167 billion yuan, with a year-on-year increase of 5.14%, aligning with market expectations. The growth is primarily driven by an increase in electricity sales from six hydropower stations and a reduction in financial costs [1][7] - The company emphasizes shareholder returns with a proposed cash dividend of 0.21 yuan per share for the first nine months of 2025, amounting to a total cash dividend of 5.138 billion yuan, which represents an 18% payout ratio [7] - The report highlights that the ten-year government bond yield remains low, creating a favorable environment for dividend-paying stocks like the company. The expected dividend yield for 2026 is 3.83%, with a spread of 1.98% over the ten-year bond yield, indicating potential for dividend growth [7] Financial Summary - The total revenue forecast for 2023 is 78.144 billion yuan, increasing to 87.609 billion yuan by 2027, with a compound annual growth rate (CAGR) of approximately 1.64% [1][8] - The net profit attributable to shareholders is projected to grow from 27.245 billion yuan in 2023 to 36.431 billion yuan in 2027, reflecting a CAGR of 5.14% [1][8] - The earnings per share (EPS) is expected to rise from 1.11 yuan in 2023 to 1.49 yuan in 2027, indicating a steady increase in profitability [1][8] - The price-to-earnings (P/E) ratio is forecasted to decrease from 24.09 in 2023 to 18.01 in 2027, suggesting an improving valuation over time [1][8]

Group 1: Core Insights - The appreciation of the RMB is expected to raise concerns about its impact on China's exports in 2026, as higher prices could weaken competitive advantages[1] - Since 2018, the sensitivity of China's exports to exchange rate changes has decreased, with "technical barriers" becoming the main competitive strength over "price advantages" due to product upgrades[1] - The proportion of RMB settlements in international trade is gradually increasing, which is expected to further reduce the impact of exchange rate fluctuations on exports[1] Group 2: Historical Review - Historical data shows that during the RMB appreciation cycles from December 2016 to April 2018 and from May 2020 to March 2022, export growth remained stable, recovering from -6.3% to over 10% and from -3.5% to 13.4%, respectively[2] - Export recovery often precedes RMB appreciation by about one quarter, indicating that rising exports may contribute to RMB appreciation rather than the other way around[2] Group 3: Factors Reducing Impact of RMB Appreciation - The actual effective exchange rate of the RMB has decreased to approximately 88.6% as of November 2025, down 16.7% from its peak in March 2022, enhancing the price competitiveness of exports[2] - The RMB's purchasing power in international markets has increased due to appreciation, benefiting imports and reducing reliance on depreciation for export competitiveness[2] - The share of labor-intensive exports is declining, while the proportion of intermediate and capital goods exports is increasing, reflecting a shift towards more technology-intensive products[2] Group 4: Trade Settlement Trends - In 2024, RMB cross-border payments for goods trade reached approximately 12.4 trillion yuan, a 15.9% increase year-on-year, with RMB settlements accounting for 27.2% of total cross-border payments, up 2.4 percentage points from 2023[2] - The RMB settlement ratio is significantly increasing in trade with emerging markets, particularly in regions like ASEAN and Africa, where growth rates of 21.8% and 35.9% were recorded, respectively[2] Group 5: Risk Considerations - There are uncertainties regarding U.S. tariff policies, which could negatively impact exports if additional tariffs are imposed[2] - A potential downturn in the U.S. economy could adversely affect global demand, posing risks to China's export performance[2]

Market Trends - The spring market rally from December to February historically shows an average increase of 16%-18% for the Shanghai Composite Index and the Wind All A Index from 2010 to 2025[1] - The current spring rally is considered to be in its latter half, with a potential for a price increase lasting about one month before entering a consolidation phase[2] Industry Performance - Growth and technology sectors have a win rate exceeding 80%, with average excess returns over 3%[12] - High-end manufacturing follows, with average excess returns above 2%, while sectors like computing, communication, and electronics show average excess returns exceeding 4%[12] Sector Rotation - As of 2026, strong sectors include military (commercial aerospace), automotive (robots), and utilities, while previously leading sectors like non-ferrous metals and machinery are in a consolidation phase[3] - The focus should be on sectors with unchanged industrial trends but relatively lower recent gains, such as lithium batteries, energy storage, humanoid robots, innovative drugs, and AI hardware[32] Risks - Market sentiment can change rapidly, leading to accelerated contraction in trading volume[34] - Potential risks include slow progress in technological breakthroughs, tightening global liquidity due to changes in overseas market expectations, and increased geopolitical risks[34]

Investment Rating - The report maintains a rating of "Buy" for the industry, indicating a positive outlook for investment in the engineering machinery sector [1]. Core Insights - The engineering machinery sector is entering a recovery phase, with strong performance in both domestic and export markets. The sector's revenue is expected to accelerate, driven by increased demand and improved profitability [5][11]. - The annualized return of the GF Engineering Machinery ETF is reported at 75.03%, significantly outperforming competitors, showcasing its strong upward capture ability [2]. - The report highlights that the engineering machinery sector exhibits a much higher annualized return compared to the construction sector, with returns nearly three times higher despite similar volatility levels [2]. Summary by Sections 1. Industry Performance Overview - The engineering machinery sector has shown a comprehensive recovery in 2025, with domestic excavator sales increasing by 19.6% year-on-year from January to October. The sector's revenue grew by 12% in the first three quarters of 2025 [5][11]. - Profitability has improved, with net profit for the sector reaching 261 billion yuan, a 23% increase year-on-year [20][21]. 2. Domestic and Export Market Predictions for 2026 - Domestic excavator demand is projected to grow at an average annual rate of over 30% from 2025 to 2028, with a peak sales volume of 250,000 units expected by 2028 [32]. - The export market is anticipated to enter a new upward cycle in 2026, driven by a potential easing of interest rates by the Federal Reserve, which could stimulate overseas demand [32]. 3. Profitability and Cost Efficiency - The report notes that the sector is experiencing a scale effect, with fixed costs being diluted as production increases, leading to enhanced profitability [5][11]. - Major companies like SANY Heavy Industry, XCMG, and Zoomlion have reported improvements in their net profit margins, indicating a positive trend in operational efficiency [5][11]. 4. Market Dynamics and Competitive Landscape - The report emphasizes the importance of capital availability in driving sales, particularly in the context of government funding for infrastructure projects [39]. - The competitive landscape remains stable, with no significant increase in competition, although the demand structure is heavily influenced by the types of excavators being sold [21][36].

东吴证券晨会纪要 东吴证券晨会纪要 2026-01-15 [Table_Tag] 宏观策略 [Table_MacroStrategy] 宏观点评 20260114：扰动结束后，美国 Q1 通胀料将反弹——2025 年 12 月美国 CPI 数据点评 核心观点：2025 年 12 月美国总体 CPI 持平预期，核心 CPI 不及预期， 从分项看，后者主要来自二手车价格下跌、电信商价格战对相关商品和服 务价格的拖累、季节性因子，这三者更多是短期扰动，我们预计其给通胀 的负面影响难以持续，大类资产也因此部分回吐数据发布之时的宽货币 交易。向前看 26Q1，需要关注在财政与货币的短期宽松脉冲与季节性因 素影响下，美国增长与通胀数据超预期偏强的风险，这将进一步压缩近期 已有所回吐的 3/4 月降息预期。 固收金工 证券研究报告 [Table_FixedGain] 固收深度报告 20260114：债市逆风中的生存法则：历史调整对当前的启 示 回溯 2016–2018 年债市，可以看到当时的利率变化顺序是政策收紧，先 推动短端利率显著上行，之后在经济韧性支撑下长端利率跟随上行，熊市 的主导力量是政策端。对比当下环境，情况有 ...

Group 1: Report Industry Investment Rating - Not provided in the given content Group 2: Core Viewpoints of the Report - The current bond market situation cannot simply be compared to the 2017 bear market as the interest rate change sequence is different. Currently, long - term interest rates rise first due to economic recovery expectations while short - term interest rates remain stable under the central bank's liquidity - maintaining policy [36]. - Systemic bear markets usually require the combination of rising short - term interest rates and tightened liquidity. Expectations alone can only lead to a phased rise in long - term interest rates but are insufficient to trigger a full - scale bear market [37]. - Given the current low short - term interest rates and the need for economic recovery, the yield inversion between money market funds and bond funds will improve. A steeper bond yield curve allows for leveraging strategies to obtain returns [37]. Group 3: Summary by Directory 1. Historical Review: Structural Anomalies from 2016 - 2018 1.1 Yield Trends - From 2016Q4, bond fund yields slowed significantly, and were outperformed by money market funds in many quarters. For example, in 2016Q4, the quarterly return of money market funds was 2.62%, while short - term pure bond funds had - 0.66% and medium - long - term pure bond funds had - 1.29%. Bond funds faced high capital costs and a flattened yield curve, resulting in large net value drawdowns [10]. 1.2 Key Policies and Major Events during the Period - In December 2016, the central bank included off - balance - sheet wealth management in the MPA's broad credit indicator, tightening non - bank institutions' funding sources. In March 2017, the CBRC launched the "Three Threes and Four Tens" special governance, shrinking bank inter - bank business and intensifying liquidity stratification. From 2016 - 2018, the central bank raised MLF and OMO rates multiple times, increasing financial institutions' capital costs. In April 2018, the asset management new regulations were officially implemented, promoting the institutionalization of de - leveraging [13]. 2. Cause Analysis 2.1 Policy Aspect: Central Bank's Open - Market Operation Interest Rate Adjustment - From 2016 - 2018, the central bank raised OMO and MLF rates, achieving a de facto interest rate hike. The 1 - year MLF rate rose from 3% in February 2016 to 3.3% in April 2018, indicating a tightening policy [16]. 2.2 Funding Aspect: Intensified Liquidity Stratification - Financial de - leveraging policies restricted inter - bank business, leading to severe liquidity stratification in the inter - bank market. The spread between R007 and DR007 widened from less than 20bp in the first three quarters of 2016 to a maximum of 71bp in March 2017, eroding bond funds' leverage arbitrage space [17][19]. 2.3 Fundamental Aspect: Strong Growth Supported Policy Implementation - In 2017, financial de - leveraging was an active policy choice during a period of strong economic fundamentals. China's GDP growth in 2017 was 6.9%, providing confidence for de - leveraging. The "high PPI, low CPI" inflation structure in 2017 created a good policy window [20][23]. 3. Relationship between Bond Yield Curve Shape and Bond Fund Yields - In 2017, the bond yield curve showed a two - stage V - shaped trend. From the end of 2016 to June 2017, it was bear - flattening due to tight funding. From July to December 2017, it was bear - deepening as strong economic fundamentals drove long - term interest rates up [25]. - The monthly returns of short - term and medium - long - term pure bond funds reflected the "first flat, then steep" change of the yield curve. From the end of 2016 to June 2017, short - term pure bond funds had lower returns, while from July to December 2017, medium - long - term pure bond funds suffered more capital losses [28]. - Bond funds' leverage ratios first decreased and then increased. In the first half of 2017, most funds reduced leverage. In the second half, short - term pure bond funds actively increased leverage as the yield curve steepened [30][32]. 4. How Did the Structural Anomaly Recover? 4.1 Policy Turnaround and Decline in Short - Term Interest Rates - In the second half of 2018, the policy shifted from de - leveraging to stabilizing growth. The central bank implemented multiple rounds of reserve requirement ratio cuts from 2018 to early 2019, releasing long - term low - cost liquidity and lowering short - term interest rates [33]. 4.2 Changes in Bond Yield Curve Shape - After the easing policy, short - term interest rates dropped rapidly, while long - term interest rates declined more slowly. The yield curve changed from bear - flat to bull - steep, reopening profit opportunities for bond funds' carry and duration strategies [34]. 5. Implications for the Current Market - The current situation is different from 2016 - 2018. The current long - term interest rate rise is driven by economic recovery expectations, and short - term interest rates are stable. The yield inversion between money and bond funds will improve, and leveraging strategies can be used [36][37].

Investment Rating - The investment rating for the company is "Buy" [1] Core Insights - The termination of the Shenghua restructuring strengthens the company's position as a leader in iron lithium batteries, with a comprehensive strategic partnership established with CATL [8] - The company plans to issue 230 million shares at a price of 13.62 yuan per share, raising 3.175 billion yuan, with CATL acquiring a 12% stake [8] - The company is expected to accelerate the construction of high-density lithium iron phosphate capacity, enhancing its competitive advantage in the industry [8] - The company anticipates a significant increase in production capacity, reaching 800,000 tons by the end of 2026, with a market share expected to rise rapidly [8] Financial Projections - Total revenue is projected to grow from 5,761 million yuan in 2023 to 57,074 million yuan in 2027, with a compound annual growth rate (CAGR) of approximately 39.90% [1] - The net profit attributable to shareholders is expected to increase from a loss of 542.73 million yuan in 2023 to a profit of 2,761.42 million yuan in 2027, reflecting a significant turnaround [1] - The earnings per share (EPS) is forecasted to rise from -0.32 yuan in 2023 to 1.62 yuan in 2027 [1] Market Data - The closing price of the stock is 18.69 yuan, with a market capitalization of approximately 31.96 billion yuan [5] - The price-to-earnings (P/E) ratio is projected to decrease from 80.54 in 2024 to 11.57 in 2027, indicating improved profitability [1][9] Operational Highlights - The company is actively expanding its robotics business and has established partnerships with major automotive clients, aiming to enhance its product offerings in the electric drive system sector [8] - The company is also venturing into the low-altitude aircraft industry, with plans to produce 8,000 units per year of key components for power systems [8]

Investment Rating - The report maintains a "Buy" rating for the environmental industry, specifically focusing on sustainable aviation fuel (SAF) and its related sectors [1]. Core Insights - Sustainable Aviation Fuel (SAF) is identified as the only feasible solution for carbon reduction in the aviation sector, with potential carbon emission reductions of 80%-85% throughout its lifecycle [9][10]. - The demand for SAF is expected to surge due to regulatory mandates in the EU and UK starting in 2025, leading to a significant increase in prices and profitability for SAF producers [15][16]. - The supply of used cooking oil (UCO), a key raw material for SAF production, is projected to become increasingly scarce, driving up its value and creating investment opportunities in companies with access to these resources [4][19]. Summary by Sections 1. SAF as the Only Viable Solution - The aviation sector is a major source of greenhouse gas emissions, with liquid fuels being irreplaceable due to high energy density requirements [9]. - SAF can be blended with traditional jet fuel without requiring major modifications to existing aircraft [10]. 2. SAF: EU Regulations and Market Dynamics - The EU will enforce mandatory SAF blending ratios starting in 2025, with targets set for 2030, 2035, 2040, 2045, and 2050 [16][18]. - The projected SAF demand in the EU is expected to reach 3,662 million tons by 2050, with a compound annual growth rate of 15% from 2025 to 2050 [19][20]. 3. UCO Supply and Demand - China's annual UCO utilization is approximately 400 million tons, with significant potential for growth, but collection remains challenging [37]. - The demand for UCO is expected to rise sharply as SAF production increases, with long-term supply shortages anticipated [4][19]. 4. Investment Recommendations - Companies with scarce UCO resources, such as Shanhigh Environmental and Longkun Technology, are recommended for investment due to the increasing value of waste oil resources [4]. - The short-term supply constraints in SAF production are expected to lead to substantial profits for SAF manufacturers [4].

Group 1: Inflation Overview - The overall CPI for December 2025 in the U.S. was +0.31%, in line with expectations, while core CPI was +0.24%, below the expected +0.30%[3] - Year-on-year CPI increased by 2.68%, matching expectations, while core CPI rose by 2.64%, slightly below the expected 2.70%[3] - The weaker-than-expected core CPI was primarily influenced by declines in used car prices, a price war among telecom companies, and seasonal factors, which are expected to have a short-term impact[3] Group 2: Economic Projections - For Q1 2026, there are upward risks to U.S. non-farm payroll and inflation data due to fiscal and monetary impulses, as well as seasonal factors[2] - The fiscal impulse for Q1 2026 is estimated to boost U.S. GDP by 2.79%, largely due to the end of government shutdowns[2] - Cumulative interest rate cuts of 75 basis points since September 2025 are expected to stimulate the economy in Q1 2026[2] Group 3: Market Reactions - Following the release of the weaker core CPI, market expectations for interest rate cuts increased, leading to rises in U.S. stocks and gold, while U.S. Treasury yields and the dollar index fell[3] - However, asset prices later partially retraced the volatility caused by the monetary easing trades[3] Group 4: Risk Factors - Potential risks include unexpected policy actions from Trump, excessive interest rate cuts by the Federal Reserve leading to inflation rebound, and prolonged high interest rates causing liquidity crises in the financial system[4]

Macro Strategy - The report anticipates a "good start" for financial data in January 2026, with expectations of a seasonal surge in new loans at the end of 2025 [1] - The US economy shows mixed signals, with a surprising drop in unemployment alleviating concerns about job market deterioration, contributing to a rise in US stock markets [1] - Upcoming focus includes the December US CPI and potential outcomes of the Trump tariff case, with expectations of limited market impact from the tariff case [1] Financial Products - A-share trading volume has surpassed 3 trillion yuan, indicating heightened trading sentiment, but short-term volatility may increase [2] - The macro timing model for January 2026 scores 0, historically correlating with a 76.92% probability of A-share index gains in the following month, averaging a 3.18% increase [2] - The report recommends a balanced allocation based on risk preferences, highlighting sectors like commercial aerospace and innovative pharmaceuticals [2] Industry Insights - The report discusses the "K-shaped" consumption differentiation in China, where high-end quality consumption contrasts with high-cost performance consumption [3][18] - This differentiation reflects a shift in consumer behavior, where emotional value becomes increasingly important alongside practical value [18] - Retail strategies are adapting to this trend, with brands like Xiaomi and BYD offering both high-end and cost-effective products to meet diverse consumer needs [19] Company Analysis - Cangge Mining's profit forecast for 2025-2027 has been revised upwards due to stable potassium chloride prices and rising lithium and copper prices, with a projected net profit increase of 50% to 90 billion yuan by 2027 [9] - New Fengming's polyester chain is expected to benefit from industry self-discipline measures, with a projected net profit of 11 billion yuan by 2027, supported by a new investment in an Egyptian project [10] - Tongkun Co. is positioned as a leading polyester filament producer, with a projected net profit of 20 billion yuan by 2027, benefiting from ongoing industry improvements and a new green fiber project [11] - Rebio Biotech, a leader in the siRNA field, is expected to tap into a potential market worth 10 billion USD with its FXI siRNA product, currently in phase 2 clinical trials [12][13]