Report Industry Investment Rating No industry investment rating is provided in the report. Report's Core View The report analyzes the credit market from September 8 - 12, 2025. It anticipates that the bond market will continue to recover, with the 10Y Treasury yield expected to be between 1.6% - 1.8% in the second half of the year. The interest rate recovery may catalyze a supplementary rally in ultra - long credit bonds. However, currently, the ultra - long credit bonds do not show obvious cost - performance advantages. Conservative investors are advised to wait and see, aiming to capitalize on the potential supplementary rally driven by the subsequent decline in interest rates [3][42]. Summary by Relevant Catalogs 1. Market Overview This Week - **Primary Market**: The issuance volume and net financing of traditional credit bonds increased compared to last week, while the repayment volume decreased. The net financing of asset - backed securities increased by 12.5 billion yuan. The weighted average issuance rates of AA + urban investment bonds and AAA financial bonds rose by over 20BP, and that of AA + industrial bonds increased by 11BP [1][9][17]. - **Secondary Market**: The trading volume of credit bonds increased by 110.6 billion yuan compared to last week. The turnover rate of urban investment bonds decreased, while that of other varieties increased. Affected by factors such as the new fund redemption fee regulations, the yields of credit bonds adjusted along with interest - rate bonds, with the long - end (over 7Y) adjusting by 6 - 9BP. The credit spreads of AA + electronics and steel industries narrowed significantly, while those of other industries and ratings fluctuated within 5BP [2][18][24]. - **Negative News**: The implied ratings of a total of 113 bond issues from 10 entities were downgraded, including 35 issues from China Merchants Shekou Industrial Zone Holdings Co., Ltd., 34 from China Overseas Land & Investment Limited, and 23 from Poly Property Group Co., Ltd. [2][38] 2. This Week's Market Analysis and Investment Suggestions - **Market Analysis**: There were 1.0684 trillion yuan of reverse repurchases due in the open market this week. The central bank conducted 1.2645 trillion yuan of reverse repurchase operations, resulting in a net injection of 196.1 billion yuan. The DR001 rate rose from 1.30% at Monday's close to 1.41% at Friday's close, but the overnight funding rate remained low, and the overall funding situation was loose [6][41]. - **Investment Suggestions**: The credit spreads of AA + electronics and steel industries narrowed significantly this week, while those of other industries and ratings fluctuated within 5BP. For urban investment bonds, the credit spreads within 1Y slightly widened, while those over 1Y compressed to varying degrees. For industrial bonds, the credit spreads widened compared to last week. For bank capital bonds, the credit spreads of bank Tier 2 and perpetual bonds of different terms and ratings widened, with the 3 - 5Y spreads widening by over 10BP in most cases [6][41]. 3. Outlook and Recommendations Considering factors such as the central bank's continuous easing and the decreasing bank liability cost, the bond market is expected to continue to recover. The report maintains the view that the 10Y Treasury yield will be between 1.6% - 1.8% in the second half of the year. The end of the quarter may bring balance - sheet return pressure on wealth management products, and after the quarter, it may be a suitable time to increase the allocation of ultra - long credit bonds. Currently, the cost - performance advantage of ultra - long credit bonds is not obvious, so conservative investors are advised to wait and see [3][42].

Investment Rating - The industry investment rating is "Positive" (maintained) [5] Core Viewpoints - The report highlights that rare earths are currently focused on inventory digestion, with prices for praseodymium and neodymium oxide experiencing a decline of 4.18% to 572,500 CNY/ton, while dysprosium and terbium oxides have seen slight increases [5][12] - The report notes that the supply side for tungsten is tightening, leading to new price highs, with black tungsten concentrate prices rising by 13.60% to 284,000 CNY/ton [5][33] - Molybdenum prices are expected to remain strong due to increased demand from steel mills, with molybdenum concentrate prices rising by 0.22% to 4,515 CNY/ton [5][24] - Tin prices are under pressure due to weak supply and demand dynamics, with SHFE tin prices down 1.69% to 274,000 CNY/ton [5][41] - Antimony prices are stable, with expectations for demand recovery in October, maintaining antimony ingot prices at 182,500 CNY/ton [5][52] - The report emphasizes the accelerating commercialization of controlled nuclear fusion materials, indicating significant opportunities for upstream materials [5][6] Summary by Sections Rare Earths - Recent price movements include a 4.18% drop in praseodymium and neodymium oxide to 572,500 CNY/ton, while dysprosium and terbium oxides have increased slightly [5][12] Molybdenum - Molybdenum concentrate prices have increased by 0.22% to 4,515 CNY/ton, with strong demand from steel mills [5][24] Tungsten - Black tungsten concentrate prices have surged by 13.60% to 284,000 CNY/ton due to supply constraints [5][33] Tin - SHFE tin prices have decreased by 1.69% to 274,000 CNY/ton, reflecting weak supply and demand [5][41] Antimony - Antimony ingot prices remain stable at 182,500 CNY/ton, with expectations for demand recovery in October [5][52] Nuclear Fusion Materials - The commercialization of controlled nuclear fusion is accelerating, presenting significant opportunities for upstream materials [5][6]

Investment Rating - The investment rating for the transportation industry is "Positive" (maintained) [4] Core Views - The express logistics sector is expected to see price increases due to a "de-involution" initiative in Anhui Province, which aims to combat unhealthy price competition and promote high-quality industry development. Starting September 15, 2025, express prices in Anhui will rise by no less than 0.2 yuan per ticket, which is anticipated to help stabilize prices in the central and eastern regions of China [4][3] - The shipping sector is experiencing a significant increase in freight rates, with VLCC TD3c TCE rising to $82,674 per day, a 34.13% increase from the previous week. This surge is attributed to the seasonal release of cargo volumes and geopolitical factors affecting oil exports [6][7] - The aviation sector is witnessing a recovery in ticket prices, with a positive year-on-year growth trend observed since August 13, 2025. This is driven by a rebound in business travel and inbound tourism, suggesting a potential for continued price increases [8][9] Summary by Sections Express Logistics - The express logistics industry is showing resilience in demand, with a focus on reducing unhealthy competition. Companies like YTO Express, Shentong Express, and SF Express are expected to benefit from this trend, with potential for improved profitability and valuation [11] Shipping - The oil transportation market is expected to benefit from OPEC+ production increases and a favorable economic environment. Companies such as China Merchants Energy and COSCO Shipping Energy are recommended for investment [11] - The dry bulk shipping market is also anticipated to recover, driven by environmental regulations and increased demand for commodities. Companies like China Merchants Industry Holdings and Haitong Development are highlighted as potential investment opportunities [11] Aviation - The aviation industry is projected to experience long-term growth due to low supply growth and improving demand. Key companies to watch include China Southern Airlines and China Eastern Airlines, which are expected to benefit from this trend [11] Supply Chain Logistics - Companies like Shenzhen International and Debon Logistics are positioned well for growth due to industry dynamics and strategic transformations [11] Ports - The port sector is seen as stable with strong cash flows, and companies like China Merchants Port and Tangshan Port are recommended for their growth potential [11]

Investment Rating - The investment rating for the non-ferrous metals industry is "Positive" (maintained) [5][11] Core Views - The report highlights that the expectation of a Federal Reserve interest rate cut in September has led to an upward trend in copper and aluminum prices. Copper prices have increased by 1.22% in London, 1.15% in Shanghai, and 2.30% in New York. The report emphasizes the importance of monitoring the Fed's rate cut decision and the demand during the peak season of September and October [4][6][5]. Summary by Sections 1. Industry Overview - The report notes significant macroeconomic information, including a substantial downward revision of the U.S. non-farm employment benchmark by 911,000 for 2025. Additionally, initial jobless claims slightly exceeded expectations, and the U.S. CPI year-on-year rate for August met expectations at 2.9% [9][10]. 2. Market Performance - The non-ferrous metals sector outperformed the Shanghai Composite Index, with the sector rising by 3.76% compared to the index's 1.52% increase. The report identifies the top-performing stocks and notes the overall positive trend in the sector [12][13]. 3. Valuation Changes - The report provides valuation metrics, indicating that the TTM PE for the non-ferrous metals sector is 24.96, with a change of 0.92. The PB for the sector is 2.98, reflecting a change of 0.10. The non-ferrous sector's PE is 112% of the overall A-share market [22][25]. 4. Industrial Metals - Copper prices have shown an increase, with London copper up 1.22% and Shanghai copper up 1.15%. The report notes a decrease in London copper inventory by 2.53% and an increase in Shanghai copper inventory by 14.91%. The report also discusses the profitability of copper smelting, which has worsened [27][39]. 5. Aluminum - The report indicates that aluminum prices have risen, with London aluminum increasing by 3.18% and Shanghai aluminum by 1.74%. The report highlights a decrease in alumina prices and an increase in aluminum smelting profits [39][40]. 6. Lithium - Lithium prices have decreased, with carbonate lithium down 3.08% to 72,450 yuan/ton. The report suggests that the lithium market is entering a destocking phase due to seasonal demand [78][79]. 7. Cobalt - Cobalt prices have increased, with overseas MB cobalt rising by 1.25% to 16.15 USD/pound. The report notes the impact of export bans from the Democratic Republic of Congo on cobalt supply and prices [91][92].

Core Insights - The report highlights that the Beijing Stock Exchange (BSE) will fully enter the "920 era" on October 9, 2025, marking a significant milestone in its development as China's third-largest stock exchange [2][7][8] - The transition to the new 920 code for existing stocks aims to enhance stock identification and streamline trading processes, thereby solidifying BSE's independent status [5][7] - The report expresses optimism about the market's upward trend, driven by ongoing high-quality expansion, stock code transitions, and the issuance of specialized index funds and ETFs [2][10][11] Market Performance - The average daily trading volume for BSE stocks has decreased to 321 billion yuan, with the BSE 50 index experiencing a weekly decline of 1.07% [10][13] - The overall price-to-earnings (PE) ratio for BSE stocks has fallen to 54.76X, while the PE ratios for the ChiNext and STAR Market have increased [13][14] - The BSE 50 index reported a value of 1,600.88 points, reflecting a downward trend compared to previous weeks [14] New Listings and Adjustments - The report notes that 36 companies have been newly listed on the BSE from January 1, 2024, to September 12, 2025, with one new company, Sanxie Electric, listed in the latest week [19][20] - The BSE 50 index will undergo its third adjustment of the year on September 15, 2025, with four companies being added and four removed from the index [10][12] Investment Recommendations - The report suggests focusing on high-quality stocks with reasonable valuations that have not yet reached new highs, as well as stocks with strong industry themes [10][11] - Specific sectors to watch include stable growth companies, high-end manufacturing, overseas-related stocks, and consumer-related stocks [11][12]

Investment Rating - Investment rating: Positive (maintained) [4] Core Viewpoints - The report emphasizes the potential of PD1/VEGF/IL-2 mechanisms and suggests continued attention on Shanghai Yizhong [3][4] - The Chinese pharmaceutical industry has completed the transition from old to new growth drivers, with innovative drugs significantly opening new growth curves for Chinese pharmaceutical companies [51][52] - The report highlights the importance of innovation in the pharmaceutical sector, with a focus on the growth of innovative drugs and the increasing ability of Chinese companies to expand internationally [51][52] Summary by Sections Market Performance - From September 8 to September 12, the pharmaceutical index rose by 1.03%, outperforming the CSI 300 index by 0.47% [5] - The number of stocks that rose this week was 263, while 220 stocks fell, with the top gainers being Zhend Medical (+41%) and Haooubo (+28%) [5][35] Investment Opportunities - Suggested stocks to watch include: 1) Innovative drugs: Xinlitai, Rejing Bio, Shanghai Yizhong, Kanghong Pharmaceutical, and others [5] 2) Companies with improving performance and low valuation: WuXi AppTec, Tigermed, and others [5] 3) Medical consumables and drug companies benefiting from marginal improvements in centralized procurement [5] Mechanism Insights - The report discusses the complementary mechanisms of PD1, VEGF, and IL-2, highlighting Shanghai Yizhong's YXC-001, which integrates these three targets into a single molecule, potentially offering significant advantages in efficacy and pharmacokinetics [3][30][34] Industry Trends - The report notes that the aging population and chronic disease demand are increasing, with a focus on cardiovascular, endocrine, and orthopedic diseases [51] - The payment side is also improving, with steady growth in medical insurance revenue and the promotion of commercial insurance [51] Future Outlook - The report anticipates a rebound in the pharmaceutical industry in 2025, driven by innovative drugs, with structural growth expected in specific sectors and stocks [51][52] - It suggests that the second half of 2025 will see a recovery in medical consumption and manufacturing performance, with a focus on low-valuation assets [52]

Group 1: Report Industry Investment Rating - The report is bullish on the bond market in the short - term [2] Group 2: Report's Core View - In August 2025, new loans increased significantly less year - on - year, and credit demand remained weak. The mortgage prepayment pressure may rise, and credit demand may be weak in the long - term. In September, banks may boost loan balance data through ultra - short - term loans, and new loans in October may be very low [2] - In recent years, individuals have deleveraged while enterprises have increased leverage, leading to rising corporate debt pressure. Personal consumption is sluggish, and corporate profitability is worrying [2] - In August, the M2 growth rate was flat month - on - month, and the M1 growth rate rebounded month - on - month. It is expected that the M1 growth rate will decline in the fourth quarter [2] - The social financing growth rate may have reached a stage peak. It is expected that new loans will increase less year - on - year in 2025, government bond net financing will expand significantly year - on - year, and the social financing growth rate may rise first and then fall, reaching about 8.1% at the end of the year [2] - The 10 - year government bond may have allocation value for bank self - operations. It is expected that the yield of the 10 - year Treasury bond will be between 1.6% - 1.8% in the second half of the year [2] Group 3: Summary by Related Catalog Credit Data - On September 12, 2025, the central bank disclosed that in August, new loans were 59 billion yuan, and social financing was 2.57 trillion yuan. At the end of August, M2 reached 332.0 trillion yuan, a year - on - year increase of 8.8%; M1 increased by 6.0% year - on - year; the social financing growth rate was 8.8% [1] - In August, new loans increased 31 billion yuan less year - on - year. Personal loans increased 3.03 billion yuan, including 1.05 billion yuan in short - term personal loans and 2 billion yuan in medium - and long - term personal loans, a significant year - on - year decrease. Corporate short - term loans increased 7 billion yuan, corporate medium - and long - term loans increased 47 billion yuan, and bill financing increased 5.31 billion yuan [2] Leverage and Financial Situation - As of the end of August 2025, the ratio of personal loans to deposit balances was only 52.7%, a decrease of 17.6 percentage points compared with the end of May 2022. Since 2021, the difference between personal deposits and loans has increased significantly, while that of corporate has decreased significantly [2] Monetary Supply - The central bank has used the new M1 caliber since January 2025. As of the end of August 2025, the new M1 balance was 111.2 trillion yuan, a decrease of 76.9 billion yuan from the beginning of the year. The M2 growth rate in August was 8.8%, flat month - on - month [2] Social Financing - In August, the social financing increment was 2.57 trillion yuan, a year - on - year decrease of 0.46 trillion yuan. The decrease mainly came from credit and government bond net financing. The social financing growth rate at the end of August was 8.8%, a decrease of 0.2 percentage points from the end of the previous month [2] - It is predicted that in 2025, social financing will be 34.6909 trillion yuan, with new loans of 16.28 trillion yuan, a decrease of 76.95 billion yuan year - on - year; government bond net financing of 13.77 trillion yuan, an increase of 247.46 billion yuan year - on - year [22]

Investment Rating - The investment rating for the company is "Buy" (maintained) [5] Core Views - The company's performance in H1 2025 met expectations, with the launch of methylphenidate officially underway [5] - The company is positioned to benefit from the growing demand for high-end controlled-release narcotic drugs, particularly methylphenidate and oxycodone, which are expected to see continued volume growth [7] - The company is increasing its R&D investment, focusing on self-developed and collaborative projects in various therapeutic areas [7] Financial Summary - For H1 2025, the company achieved revenue of 732 million yuan, a year-on-year decline of 4.80%, while net profit attributable to the parent company was 90 million yuan, a year-on-year increase of 16.53% [7] - The company's gross margin and net profit margin for H1 2025 were 64.25% and 12.32%, respectively, with a year-on-year change of -7.28% and +2.26 percentage points [7] - Revenue projections for 2025-2027 are 1.688 billion yuan, 2.009 billion yuan, and 2.385 billion yuan, with corresponding year-on-year growth rates of 11.16%, 19.01%, and 18.74% [6][8] - The forecasted net profit for 2025-2027 is 209 million yuan, 265 million yuan, and 340 million yuan, with year-on-year growth rates of 30%, 26.69%, and 28.54% [6][8] Market Position and Product Pipeline - The company has a leading position in the high-tech permeation pump controlled-release technology field, with several products already launched [7] - The newly launched methylphenidate controlled-release tablets are expected to achieve rapid market penetration due to the growing prevalence of ADHD among children and adolescents in China [7] - The oxycodone controlled-release tablets are projected to maintain rapid growth, with expected sales exceeding 100 million yuan in their first full year of sales [7]

Investment Rating - The investment rating for the company is "Buy" (maintained) [3] Core Views - The company reported a significant increase in revenue and net profit for the first half of 2025, with revenue growing by 26.0% to 70 billion and net profit increasing by 33.5% to 14.8 billion [3] - The contribution of new business value (NBV) from bancassurance exceeded 50%, indicating a stable trend in the individual insurance sales force [4][6] - Investment performance has been strong, with a notable increase in investment income, which is crucial for the company's overall performance [5][6] Summary by Sections Financial Performance - In the first half of 2025, the company achieved a 58.4% growth in NBV, driven by a 65% increase in first-year premiums and a 353% increase in single premiums [6] - Total investment return rate and comprehensive investment return rate were reported at 5.9% and 6.3%, respectively [3] Profit Forecast and Valuation - The company is expected to achieve net profits of 29.7 billion, 28.6 billion, and 30.3 billion for the years 2025 to 2027, with growth rates of 13.3%, -3.7%, and 6.1% respectively [8] - The estimated intrinsic value per share for 2025-2027 is projected to be 92.8, 101.6, and 111.7 yuan, with current price-to-embedded value (P/EV) ratios of 0.68, 0.62, and 0.57 [8] Investment Strategy - The company is focusing on enhancing its bancassurance channel by increasing cooperation with more banks, which is expected to boost its performance [6] - The individual insurance sales force has shown signs of stabilization, with a significant increase in qualified personnel [6][12]

Investment Rating - The investment rating for China Pacific Insurance is "Buy" (maintained) [5] Core Views - China Pacific Insurance reported a strong performance in its 2025 mid-year report, with revenue and net operating profit increasing by 3.0% and 7.1% year-on-year to 200.5 billion and 19.9 billion respectively. The net profit attributable to shareholders grew by 11% to 27.9 billion, driven by underwriting profits from property insurance and group investment income [6][12] - The life insurance segment showed robust growth, with new business value (NBV) increasing by 32.3% year-on-year in the first half of 2025, primarily supported by the bancassurance channel, which saw a 58.6% increase in new policies [6][12] Summary by Sections Market Performance - The closing price as of September 11, 2025, was 38.14 yuan, with a market capitalization of approximately 366.92 billion [3] Financial Data - Total assets are projected to reach approximately 3,291.85 billion by 2025, with total liabilities at around 2,948.76 billion [21] - The company’s debt-to-asset ratio stands at 89.66% [3] Life Insurance Business - The life insurance segment's net profit growth was 3.6%, contributing 72.8% to the total net profit. The segment's comprehensive solvency ratio improved to 215% by June 2025 [9][12] - The bancassurance channel's contribution to NBV reached 37.8%, indicating strong growth potential in this area [9] Property Insurance Business - The comprehensive cost ratio for property insurance decreased by 0.8 percentage points to 96.3%, attributed to stricter regulations and a focus on high-quality development [9] Investment Business - The investment strategy emphasizes a balanced approach between long-duration bonds and high-growth equity assets, with total investment income decreasing slightly due to market fluctuations [12] - The establishment of new investment funds aims to enhance alternative investment opportunities, with targeted sizes of 30 billion and 20 billion for the respective funds [12] Earnings Forecast and Valuation - Projected net profits for 2025-2027 are 48.1 billion, 55.2 billion, and 64.4 billion respectively, with corresponding growth rates of 6.9%, 14.8%, and 16.6% [12] - The price-to-embedded value (P/EV) ratio is expected to decline from 0.58 in 2025 to 0.46 in 2027, indicating a favorable valuation outlook [12]