Investment Rating - The report maintains an "Outperform" rating for the insurance industry, indicating that the industry's stock performance is expected to exceed market benchmarks over the next 12 months [9]. Core Insights - Recent financial policies announced by regulatory bodies aim to inject more capital into the insurance market, including an additional 600 billion RMB for long-term investments and a 10% reduction in stock investment risk factors, which could release over 1,500 billion RMB in new market funds [1][3]. - The average solvency ratio for the industry is projected to improve from 199.4% to 200.6% following these adjustments, reflecting enhanced financial stability [1][5]. - High dividend stocks are identified as a key focus for future equity asset allocation by insurance companies, with expectations for increased investment in these assets due to regulatory support [3]. Summary by Sections Investment Policy Changes - The insurance sector will see the long-term investment pilot scale increase to 2,220 billion RMB, up from 1,620 billion RMB, reflecting strong participation from leading insurance firms [3][4]. - The adjustment of stock investment risk factors is expected to significantly impact the capital requirements for equity investments, allowing for greater flexibility in asset allocation [3][4]. Financial Projections - The report estimates that the release of minimum capital due to the risk factor adjustments could lead to an influx of approximately 1,529 billion RMB into the stock market, primarily targeting large-cap blue-chip stocks and high-yield equities [3][5]. - The insurance industry's total investment balance is projected to reach 33.26 trillion RMB by the end of 2024, with stock investments accounting for 7.3% of this total [3][4]. Recommendations - The report suggests a focus on defensive leaders in property and casualty insurance, recommending a buy for China Pacific Insurance (2328 HK) with a target price of 15.8 HKD, and AIA Group (1299 HK) with a target price of 89 HKD, citing their strong market positions and growth potential [3].

Macro Economic Overview - To counter the impact of tariffs, China has introduced a comprehensive monetary policy package aimed at boosting the stock and real estate markets. This policy will moderately ease liquidity and credit supply, encouraging positive market sentiment, although it cannot fully offset the economic impact of tariffs [2] - The report anticipates that the tariff impacts could reduce China's GDP and CPI growth rates by 1 percentage point and 0.2 percentage points, respectively. It is expected that GDP growth will slow from 5.4% in Q1 2025 to 4.5% in Q2, with a slight rebound to 4.7% in the second half of the year, resulting in an annual growth rate of 4.8% [5] Industry Insights - In the equipment manufacturing sector, global machinery manufacturers are assessing the impact of US tariffs, with most expecting effects to become apparent starting in Q3. Companies like Komatsu are predicted to face significant challenges due to these tariffs [5] - The Chinese insurance industry is set to see an acceleration of long-term investments as regulatory bodies announced a series of financial policies. This includes expanding the scope of long-term investment trials and adjusting risk factors for stock investments, potentially injecting over 150 billion yuan into the market [5] Stock Recommendations - Geely Automobile (175 HK) is rated as a "Buy" with a target price of 23.00, representing a 37% upside potential [6] - Xpeng Motors (XPEV US) is also rated as a "Buy" with a target price of 28.00, indicating a 46% upside [6] - Luckin Coffee (LKNCY US) is rated as a "Buy" with a target price of 40.61, suggesting a 24% upside [6] - Alibaba (BABA US) is rated as a "Buy" with a target price of 157.00, reflecting a 27% upside potential [6] - Tencent (700 HK) is rated as a "Buy" with a target price of 625.00, indicating a 28% upside [6]

2025 年 5 月 7 日 招银国际环球市场 | 市场策略 | 招财日报 每日投资策略 宏观及公司点评 全球市场观察 宏观经济 ◼ 美国经济 - 关税短期升成本作用超过降需求效应 美国 4 月服务业 PMI 超预期回升，商业活动延续扩张，需求小幅改善，关税 冲击尚未带来需求紧缩效应，反而通过刺激抢购囤货而带动零售、物流、仓 储和贸易活动；物价指数大幅反弹，与关税推升消费者通胀预期相一致。制 造业 PMI 收缩幅度扩大，生产指数大幅降至 2020 年 5 月以来新低；关税扰 动供应链导致交付时间变长，价格指数创近 3 年新高，企业库存下降。 招银国际研究部 数据公布后，美国 10 年国债利率上升 4bp 至 4.36%，市场对全年降息幅度预 期下降 3bp 至 76bp。短期内，关税推升成本作用超过降低需求效应，通胀反 弹风险大于失业上升风险，美联储在 5、6 月份可能保持政策利率不变。下半 年，随着需求收缩效应超过成本上升作用，就业市场可能明显放缓，通胀可 能见顶回落，美联储可能在 7 月或 9 月降息一次，11 月或 12 月再降一次。 （链接） 邮件：research@cmbi.com.hk | 环球主 ...

Economic Indicators - The ISM Services PMI rose from 50.8 in March to 51.6 in April, exceeding market expectations of 50.2, indicating an acceleration in service sector expansion[2] - The Manufacturing PMI decreased from 49 in March to 48.7 in April, better than the expected 47.9, suggesting a contraction in manufacturing activity[2] Inflation and Costs - The price index for services increased from 60.8 to 65.1, reaching a nearly two-year high, while the manufacturing price index rose from 69.4 to 69.8[2] - Tariffs are expected to raise PCE inflation by up to 0.6 percentage points over the next two quarters, with short-term inflation risks outweighing unemployment risks[2] Federal Reserve Outlook - The market's expectation for interest rate cuts in 2023 decreased by 3 basis points to 76 basis points following the data release, with the Fed likely to maintain rates in May and June[1] - The Fed may consider rate cuts in July or September, followed by another cut in November or December as demand contraction begins to outweigh cost increases[1]

宏观、行业及公司点评 全球市场观察 宏观经济 美国经济 - 就业仍然稳健降低近期降息概率 2025 年 5 月 6 日 招银国际环球市场 | 市场策略 | 招财日报 每日投资策略 美国 4 月新增非农就业 17.7 万人，超出市场预期，显示美国就业市场仍然稳 健。时薪增速延续下降，已基本回到与 2%通胀目标相符的水平，预示核心服 务通胀将保持回落。每周工时与职位空缺数/失业人口比已低于疫情前水平， 显示劳动力市场供需平衡，预示目前的就业市场应对关税冲击的缓冲更小。 失业率保持在 4.2%，就业人数连续 2 月反弹。 数据公布后市场预期 6 月不降息的概率从 42%升至 69%，全年降息幅度从 91bp 降至 78bp。由于就业市场仍然稳健，关税可能推升近期通胀，我们预 计美联储 5 月和 6 月可能保持政策利率不变。由于市场对政策利率预期更加 招银国际研究部 邮件：research@cmbi.com.hk | 环球主要股市上日表现 | | | | | --- | --- | --- | --- | | | 收市价 | | 升跌（%） | | | | 单日 | 年内 | | 恒生指数 | 22,505 | 1. ...

2025 年 5 月 6 日 招银国际环球市场 | 宏观研究 | 宏观视角 美国经济 刘泽晖 (852) 3761 8957 frankliu@cmbi.com.hk 叶丙南, Ph.D (852) 3761 8967 yebingnan@cmbi.com.hk 资料来源：Wind, 招银国际环球市场 资料来源：Wind, 招银国际环球市场 资料来源：Wind, 招银国际环球市场 (15) (10) (5) 0 5 10 15 3 4 5 6 7 8 9 10 11 12 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 失业率(左轴) 非农就业增速(右轴) (%) (%) (1,000) (800) (600) (400) (200) 0 200 400 600 800 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 政府 服务 商品 月均新增就业(千人) 0 50 100 150 200 250 300 350 400 450 500 ...

2 May 2025 CMB International Global Markets | Equity Research | Company Update Microsoft (MSFT US) Cloud revenue growth reaccelerated Microsoft reported (1 May HKT) 3QFY25 (June year-end) results: revenue was US$70.1bn, up 13.3% YoY (2QFY25: +12.3% YoY), 2% better than both our forecast and consensus estimates, mainly driven by a 3/6% beat in Intelligent Cloud / More Personal Computing (MPC) segment. Net profit was up 17.7% YoY to US$25.8bn, 7% better than our forecast and consensus, driven by better- than- ...

Investment Rating - The report maintains a "Buy" rating for AIA Group Ltd. with a target price of HK$89, indicating a potential upside of 53.2% from the current price of HK$58.10 [4][29]. Core Insights - AIA Group reported a strong growth in Value of New Business (VONB) of 13% year-on-year (YoY) in Q1 2025, driven by a 3 percentage point increase in profit margin and a 7% growth in Annualized New Premium (ANP) [1][2]. - The VONB margin reached a record high of 57.5%, attributed to a gradual shift in product mix towards participating long-term savings [1][2]. - The company initiated a US$1.6 billion share buyback program, expected to be completed faster than initially planned, reflecting AIA's commitment to shareholder returns [1][2]. Summary by Sections VONB Growth - Group VONB increased by 13% YoY to US$1.5 billion in Q1 2025, with agency VONB growing by 21% to US$1.22 billion, accounting for 75% of the total [2][3]. - The cooperative VONB saw a decline of 2% to US$400 million due to increased competition in Hong Kong and regulatory tightening in China [2][3]. - Excluding China, bank insurance VONB grew by 21% YoY [2]. Financial Performance - The report projects a total shareholder return of 6.2% for FY2025, with a dividend yield of 3.3% and a buyback yield of 2.9% [1][3]. - The operating profit after tax (OPAT) is expected to grow at a compound annual growth rate (CAGR) of 11% from 2023 to 2026 [1][3]. Valuation Metrics - The stock is valued at a price-to-embedded value (P/EV) of 1.05 times and a price-to-book (P/B) ratio of 1.65 times for FY2025 [3][4]. - The report estimates a forward operating return on equity (ROE) of 15% over the next three years [3].

Investment Rating - The report maintains a "Buy" rating for WuXi AppTec, indicating a potential return of over 15% in the next 12 months [19]. Core Insights - WuXi AppTec reported strong financial performance for Q1 2025, with revenue increasing by 21.0% year-on-year to RMB 9.65 billion, and adjusted non-IFRS net profit rising by 40.0% to RMB 2.68 billion [1][2]. - The TIDES business segment experienced significant growth, with revenue soaring by 187.6% to RMB 22.4 billion, driven by expanded capacity and contributions from oral GLP-1 projects [2]. - Despite ongoing macroeconomic uncertainties, management reaffirmed its annual performance guidance, expecting a revenue growth of 10-15% and an expansion in adjusted non-IFRS net profit margin [1][2]. Financial Summary - For FY25E, revenue is projected at RMB 42.97 billion, reflecting a year-on-year growth of 9.5%, while adjusted net profit is expected to reach RMB 11.61 billion, a growth of 9.7% [4][16]. - The company’s unfulfilled contract amount grew by 47.1% year-on-year to RMB 52.33 billion by the end of Q1 2025, indicating a solid foundation for future growth [1]. - The report also highlights a decrease in the P/E ratio from 16.5 in FY24A to 15.0 in FY25E, suggesting improved valuation attractiveness [4][16]. Shareholder Returns - WuXi AppTec's board proposed a series of shareholder return plans, including maintaining a 30% annual cash dividend payout ratio and a one-time special dividend of RMB 10 billion in 2025 [3]. - The total proposed dividend and buyback plan amounts to nearly RMB 60 billion, representing 62% of the net profit attributable to shareholders for 2024 [3]. Valuation - The target price has been adjusted from RMB 94.05 to RMB 77.22 based on DCF valuation, reflecting a downside risk of 27.7% from the current price of RMB 60.45 [5][6].

Market Overview - Global markets showed mixed performance with the Hang Seng Index closing at 22,008, up 0.16% year-to-date increase of 29.10% [1] - The US markets continued to rebound, with the Dow Jones up 0.75% and the S&P 500 up 0.58%, reflecting a year-to-date increase of 7.53% and 16.58% respectively [1][3] Industry Insights - The equipment manufacturing sector reported Q1 2025 earnings, with SANY Heavy Industry exceeding expectations with a 56% year-on-year profit increase, driven by an 18% revenue growth [4] - The pharmaceutical company WuXi AppTec reported a strong Q1 2025, with revenue up 21% to 9.65 billion yuan and a non-IFRS net profit increase of 40% to 2.68 billion yuan [4][6] - Mindray Medical's revenue for 2024 was 36.7 billion yuan, a 5.1% increase, but faced challenges in the domestic market with a 12.1% decline in Q1 2025 revenue [7][8] Company Analysis - WuXi AppTec maintained its full-year guidance despite macro uncertainties, expecting a 10-15% revenue growth in its continuing operations for 2025 [4][6] - Mindray Medical's overseas revenue grew by 21.3% in 2024, accounting for 44.7% of total revenue, indicating strong international market performance [7] - Luckin Coffee reported a 41% year-on-year sales increase in Q1 2025, driven by strong same-store sales growth and rapid store expansion [11][12] Investment Ratings - SANY Heavy Industry is rated as a "Buy" with a focus on its excavator business cycle and overseas growth potential [4] - WuXi AppTec is also rated as a "Buy," with a target price of 77.22 yuan, reflecting confidence in its growth despite external challenges [6] - Mindray Medical is rated as a "Buy," with a target price of 249.19 yuan, anticipating recovery in domestic sales in the latter half of 2025 [8]