Group 1: Federal Reserve Rate Decision - The Federal Open Market Committee (FOMC) lowered the federal funds rate target range by 25 basis points to 4.50%-4.75% on November 7, 2024[1] - Prior to the meeting, the market had priced in a 98.93% probability of a 25 basis point rate cut[2] - The employment market conditions were described as "generally eased," indicating a broader adjustment in the labor market[2] Group 2: Inflation and Economic Outlook - The FOMC removed the term "further" from its inflation statement, reflecting a decrease in confidence regarding inflation improvement[3] - The September CPI exceeded expectations, with Powell noting that the inflation report was "not bad, but slightly above expectations"[3] - The FOMC emphasized that any government policies could significantly impact economic conditions and their dual mandate goals[3] Group 3: Future Rate Expectations - The market currently anticipates a 64.6% probability of another 25 basis point cut in December 2024[10] - The inflation levels in 2025 are expected to significantly influence the Fed's rate-cutting pace, with potential economic growth and inflation pressures from proposed stimulus policies[10] - The Fed is expected to proceed cautiously towards a neutral rate, with a gradual reduction in the pace of rate cuts as rates approach neutrality[9]

Investment Rating - The report maintains an "Outperform" rating for the electric equipment industry [5]. Core Insights - The demand for smart meters is expected to grow steadily, driven by both domestic and international markets, with a projected increase in the number of smart meters from 162 million in 2024 to 236 million by 2029, representing a compound annual growth rate (CAGR) of approximately 7.81% [2][24]. - The domestic market is currently in the replacement phase for the second generation of smart meters, with a total expected tender volume of 95.28 million units in 2024, reflecting a year-on-year increase of 25% [1][13]. Summary by Sections Domestic Electric Meter Development - The evolution of domestic electric meters has transitioned from mechanical meters to electronic meters, and now to smart meters, enhancing their functionality and value [9][18]. - The tendering cycle for electric meters aligns with technological updates, with significant growth in tender volumes observed since 2020, indicating a robust market outlook [13][17]. Overseas Demand - Different regions exhibit varying stages of development and demand for smart meters, with Asia-Pacific showing the fastest growth, particularly in Southeast Asia and South Asia, while Africa has a high demand for new installations due to significant electricity access gaps [2][36]. - The global smart meter investment increased from $10.2 billion in 2015 to $21.7 billion in 2022, indicating a strong market trend [24]. Competitive Landscape - Domestic electric meter manufacturers are experiencing growth in overseas revenues, while international competitors face stagnation or contraction in non-core regions [3][19]. - The competitive landscape remains fragmented, with the top 10 suppliers accounting for approximately 30% of the market share, indicating opportunities for smaller players [18][22]. Recommendations - The report suggests focusing on electric meter manufacturers that emphasize local production overseas, such as HaiXing Electric, Samsung Medical, Weisheng Holdings, and LinYuan Energy, as they are well-positioned to capitalize on international market opportunities [4][3].

Investment Rating - The report maintains an "Outperform" rating for the pharmaceutical and biotechnology industry [1]. Core Viewpoints - The pharmaceutical industry is currently undervalued, with public fund holdings in pharmaceutical stocks at a relative low over the past decade [1][14]. - In the first three quarters of 2024, the net profit growth rate for the pharmaceutical and biotechnology industry has narrowed, with total revenue of 1,824.34 billion yuan, a year-on-year decrease of 0.51%, and a net profit of 152.50 billion yuan, down 8.22% [1][16]. - The segments showing positive revenue growth in Q3 2024 include APIs (Active Pharmaceutical Ingredients), chemical preparations, pharmaceutical commerce, and medical devices [1][17]. - The report highlights a good growth trend in APIs, with increased R&D investment, while chemical preparations are expected to develop steadily [1][26][30]. Summary by Sections Q3 Revenue Growth - Q3 2024 saw a year-on-year revenue increase, with APIs, chemical preparations, pharmaceutical commerce, and medical devices showing positive growth [1][20]. - The overall pharmaceutical sector underperformed compared to the CSI 300 index due to industry restructuring and centralized procurement [5][20]. Growth Potential in the Pharmaceutical and Biotechnology Industry - The report expresses optimism about the growth potential in the pharmaceutical and biotechnology industry, particularly in the APIs and chemical preparations segments [1][26]. - The APIs segment achieved a total revenue of 72.55 billion yuan in the first three quarters of 2024, with a year-on-year growth of 3.46% [26]. - The chemical preparations segment reported a revenue of 3,170.28 billion yuan, up 3.98% year-on-year, with a significant net profit increase of 31.49% [30]. Investment Recommendations - The report suggests focusing on specific companies within various segments: - APIs: Chuan Ning Biological, Garden Biological - Chemical preparations: Heng Rui Pharmaceutical, Bai Li Tianheng - Traditional Chinese medicine: Da Ren Tang, Tian Shi Li - Biological products: Zhi Fei Biological, Tian Tan Biological - Pharmaceutical commerce: Shanghai Pharmaceutical, Yi Feng Pharmacy - Medical devices: Mai Rui Medical, Ao Hua Endoscopy - Medical services: WuXi AppTec, Tong Ce Medical [1].

Investment Rating - The automotive industry is rated as "Outperform" [4] Core Insights - The overall sales in the automotive industry remain stable, with significant improvements in the profitability of auto parts [1][29] - The passenger vehicle sector shows revenue growth without profit increase, while commercial vehicles face overall pressure [1][49] - The automotive sector has outperformed the market, with a notable increase in the commercial vehicle segment [2][15] Summary by Sections 1. Market Performance - As of November 6, 2024, the automotive sector has increased by 18%, outperforming the CSI 300 index by 0.9 percentage points [2][15] - The passenger vehicle and commercial vehicle segments have shown significant excess returns, with increases of 32% and 64% respectively [2][15] 2. Sales Stability and Growth - Total automotive sales for the first three quarters of 2024 reached 21.57 million units, a year-on-year increase of 2.37% [29] - In Q3 2024, total automotive sales were 7.52 million units, with passenger vehicle sales at 6.70 million units, down 2.33% year-on-year [29][34] - New energy passenger vehicle sales in Q3 2024 reached 3.24 million units, up 34.40% year-on-year [34] 3. Company Performance - In Q3 2024, passenger vehicle companies generated revenue of CNY 510.42 billion, a year-on-year increase of 2.36% [1][38] - Commercial vehicle companies reported revenue of CNY 74.44 billion, down 12.33% year-on-year [49] - The profitability of auto parts companies improved, with a net profit of CNY 184 billion, up 15.2% year-on-year [1][49] 4. Investment Recommendations - For passenger vehicles, focus on electric intelligence, domestic brands, and export opportunities, recommending companies like BYD, Li Auto, and Geely [7] - For commercial vehicles, pay attention to export and vehicle replacement policies, recommending companies like FAW Jiefang and China National Heavy Duty Truck [7][8]

Industry Investment Rating - The report maintains a "Stronger than the Market" rating for the media and internet industry [4] Core Views - The media and internet industry is stabilizing and recovering, with a positive outlook on the AI industry chain and mergers and acquisitions [1] - The advertising, e-commerce, and gaming sectors are showing signs of stabilization and recovery [3] - The AI industry chain is entering its first year of application, with a focus on emotional companionship and decision-making assistance [3] - Mergers and acquisitions are supported by policy, with companies having sufficient cash on hand and lower net profit margins being more likely to engage in M&A [3] Industry Overview Advertising Market - The domestic advertising market is growing steadily, with a 3.1% year-on-year increase in ad spending from January to August 2024 [11] - Internet advertising market grew by 5.5% YoY in Q3 2024, reaching 176.32 billion RMB [13] - Advertising spending is increasingly concentrated in top platforms, with short videos becoming a key channel for direct conversions [16] E-commerce Market - Online retail sales of physical goods reached 3.1 trillion RMB in Q3 2024, a 4.4% YoY increase [20] - Fresh food and second-hand e-commerce platforms are experiencing high growth, with Hema and Dingdong Maicai showing significant user growth [22][26] Gaming Market - The gaming market rebounded in Q3 2024, with a 23% QoQ and 9% YoY increase in revenue, reaching 91.77 billion RMB [30] - Domestic self-developed games achieved overseas revenue of 5.17 billion USD, a 20.8% YoY increase [30] - Mobile games and client games showed stable performance, with mobile games generating 65.66 billion RMB in revenue, a 1.2% YoY increase [31] Listed Media Companies Performance Revenue and Profit - Listed media companies reported a 3.2% YoY decline in revenue and a 37.3% YoY decline in net profit in Q3 2024 [37] - The publishing and advertising sectors showed stronger resilience compared to other sub-sectors [40] Profitability - Gross profit margin for listed media companies dropped to 30.0% in Q3 2024, down 1.7 percentage points YoY [45] - The gaming and TV broadcasting sectors experienced the largest declines in net profit margins [50] Cash Flow - Operating cash flow for listed media companies decreased by 34.1% YoY in Q3 2024, with the gaming sector showing relatively better cash flow performance [54][58] Investment Strategy AI Industry Chain - The AI application market is growing rapidly, with AIGC apps reaching 79.13 million monthly active users in September 2024, a 393.9% YoY increase [66] - Emotional companionship and decision-making assistance are key areas of focus within the AI industry chain [68] Mergers and Acquisitions - Policy support for mergers and acquisitions is strong, with companies having sufficient cash and lower net profit margins being more likely to engage in M&A [72] - Companies like Wanxin Media, Oriental Pearl, and Times Publishing are recommended for potential M&A activities [73]

· · 信息技术 · 证券研 2024 年 11 月 08 日 利润承压静待宏观复苏,国产自主可控 方向坚定 信息技术行业专题研究 � � ◆ 细分板块:算力、智驾、信创景气度较高，收入均有不同幅度增长; 数据要素收入端持续承压,仍待强力政策落地迎接拐点;网络安全板 块部分企业出现恢复性增长;工业互联网板块利润端承压,收入端因 制造业低迷增速缓慢。 � � 【配置建议】 【风险提示】 【投资要点】 机构持仓集中在第力及信创。九月以来,随着政策回暖,计算机(申 万）板块呈现强弹性。机构持仓方面,重仓持股中基金持股比例最高 的为海光信息、新点软件、寒武纪-U、达梦数据、纳思达，主要集中 在算力和信创领域，算力及信创领域维持高景气度。 算力:建议关注海光信息、寒武纪-U、景嘉徽、中科曙光、浪潮信息、 网宿科技等;智能驾驶:建议关注光庭信息、中海达、中科创达、德 赛西威、北汽蓝谷等:敏据要素;建议关注久远银海、德生科技、普 元信息、云赛智联、深桑达、易华录、太极股份、山大地纬、银之杰、 科创信息等:信创;建议关注金山办公、达梦数据、中国软件、中国 长城、纳思达、软通动力、麒麟信安等。工业互联网:建议关注中控 技术、中 ...

Investment Rating - The report maintains a rating of "Outperform" for the electric equipment industry [5]. Core Insights - The virtual power plant (VPP) is identified as a flexible resource aggregation platform that coordinates power supply and demand, leveraging distributed energy resources, adjustable loads, and storage [11][4]. - The report highlights the gradual clarification of revenue models for virtual power plants as the electricity market reform deepens in China, with the official operation of the inter-provincial electricity spot market marking a new phase in market construction [3][27]. - The report recommends focusing on platform technology providers and load-side resource aggregators, specifically mentioning companies such as Guodian NARI, Dongfang Electronics, State Grid Information Communication, and others as potential beneficiaries [3][29]. Summary by Sections 1. Virtual Power Plants as Flexible Resource Aggregation Platforms - Virtual power plants aggregate distributed energy resources, adjustable loads, and storage, utilizing technologies such as metering, communication, control, big data, and artificial intelligence [11][4]. - The report categorizes virtual power plants into different types based on the aggregated resources, including generation-type, load-type, storage-type, and hybrid virtual power plants [12][13]. 2. Deepening Electricity Market Reforms and Evolving Revenue Models - The report notes that the revenue models for virtual power plants are becoming increasingly diverse, including demand response, auxiliary service trading, and electricity spot market trading [21][22]. - The implementation of the "Basic Rules for the Electricity Auxiliary Service Market" in 2024 will officially recognize virtual power plants as participants in auxiliary services [29][3]. 3. Market Participants and Beneficiary Companies - The report identifies numerous market participants, emphasizing that the incremental growth lies with platform technology providers and user-side aggregators [3][29]. - Specific companies highlighted as potential beneficiaries include Guodian NARI, Dongfang Electronics, State Grid Information Communication, Guoneng Rixin, Anke Rui, and Suwen Electric [3][29]. 4. Policy and Regulatory Framework - The report discusses the ongoing policy support for virtual power plants, with various provinces implementing guidelines for their participation in electricity markets and auxiliary services [29][35]. - It emphasizes the importance of a well-structured electricity market that includes spot markets, mid-to-long-term markets, and comprehensive auxiliary services to support the profitability of virtual power plants [23][21].

Investment Rating - The report assigns a rating of "Accumulate" for the company [6]. Core Views - The company reported a revenue of 1.17 billion yuan for the first three quarters of 2024, representing a year-on-year increase of 1.37%, with a net profit attributable to shareholders of 110 million yuan, up 33.47% year-on-year [1]. - The company benefits from the high demand in the Tibet region due to infrastructure and mining projects, with sales value in the region reaching 332 million yuan, a significant increase of 102.06% year-on-year [1][2]. - Cost reduction and efficiency improvements have been notable, with a decrease in expense ratio by 3.7 percentage points, helping maintain profit growth despite a slight decline in revenue for Q3 [1]. Summary by Sections Financial Performance - For Q3 2024, the company achieved a revenue of 448 million yuan, down 4.29% year-on-year, while net profit was 56 million yuan, an increase of 11.46% year-on-year [1]. - The gross profit margin for the first three quarters was 26.91%, a decrease of 2.63 percentage points year-on-year, with Q3 margin at 28.79%, down 1.91 percentage points year-on-year [1]. Future Outlook - The report forecasts net profits for 2024-2026 to be 121 million, 222 million, and 388 million yuan respectively, with growth rates of 23.56%, 83.56%, and 74.97% [6]. - The company is expected to benefit from the growth in water conservancy and mining projects, with a projected investment growth rate of 37.1% in the water management sector [2]. Market Position - The company has a total market capitalization of approximately 9.29 billion yuan, with a 52-week high of 34.19 yuan and a low of 10.05 yuan [4]. - The stock has seen a 52-week increase of 95.60% [4].

Investment Rating - The report maintains a "Strong Buy" rating for the industry, indicating a positive outlook for investment opportunities [4]. Core Insights - The consumer sector in Q3 2024 shows a mixed performance, with a fund allocation of 20.05%, reflecting a slight increase of 0.32 percentage points from the previous quarter, yet still at the lower end of historical ranges [13][14]. - The beauty and personal care segment is under pressure, but potential recovery is anticipated due to supportive policies and improving market sentiment [1][2]. - Retail performance is uneven, with specific sectors like IP consumption and bulk snacks showing resilience, while overall profitability is expected to improve as consumer policies take effect [1][2]. Summary by Sections Beauty and Personal Care - The beauty care sector is experiencing weak growth, with significant performance differentiation among companies. Key stocks to watch include Aimeike and Betaini, which are expected to benefit from policy support [1][2]. - The beauty business is facing a slowdown, with a notable decline in revenue growth rates [1][2]. Retail - The retail sector is under pressure, with increasing performance divergence among individual stocks. Recommended companies include Anker Innovations and Chongqing Department Store, which are expected to maintain strong positions in a stable competitive landscape [1][2]. - The jewelry sector is entering a deleveraging phase, while the cross-border e-commerce segment faces intensified competition and rising shipping costs [1][2]. Travel and Hospitality - The hotel and duty-free sectors are experiencing performance challenges, with a focus on price-driven volume growth strategies. Recommended companies include Ctrip Group and Jinjiang Hotels, which are expected to navigate these challenges effectively [2][20]. - The duty-free segment is highlighted for potential rebound opportunities, particularly for leading players like China Duty Free Group [2]. Human Resources - The human resources sector shows strong revenue and performance, particularly in outsourcing and flexible labor services. Recommended companies include Beijing Human Resources and Recruit International, which are expected to maintain robust growth [2][11]. Education - The education sector, particularly the training segment, is performing well, while vocational education and educational technology face revenue pressures. Key players include New Oriental and TAL Education, which are expected to continue their growth trajectories [2][11]. Home Appliances - The home appliance sector shows significant differentiation, with the white goods segment maintaining stable operations despite a slowdown in revenue growth. Companies like Midea Group and Haier Smart Home are recommended for their resilience [2][11].

Industry Investment Rating - Stronger than the market (maintained) [7] Core Views - The report highlights the potential of copper paste as a cost-effective alternative to silver paste in the photovoltaic (PV) industry, with significant profit margins expected due to cost reductions of 20%-60% [4] - The adoption of copper paste is seen as a major trend in the metalization process, driven by the need to reduce costs amid declining silver prices and rising silver consumption [5] - The report recommends focusing on leading material companies such as **Polyrocks Materials**, **Deke Corporation**, and **Suzhou Good-Ark** due to their potential in the copper paste market [43] Summary by Sections Metalization Cost Reduction and Copper Paste Solution - Metalization cost reduction is urgent due to the rising cost of silver paste, which currently accounts for 31.97% of total battery production costs, slightly lower than silicon wafers at 44.22% [13] - Two main directions for cost reduction: 1) Process improvements to reduce silver paste usage (e.g., multi-busbar, busbar-free technologies), and 2) Substituting silver with cheaper conductive metals like copper [15] - Copper paste is considered the ideal solution for TOPCon metalization cost reduction, as it addresses issues like copper oxidation and sintering diffusion [22] Potential Application of Copper Paste in PV - A proposed application involves a double-layer structure using silver seed layers/points combined with copper paste, which reduces silver consumption to 2mg/w while maintaining battery conversion efficiency [3] - The double-layer structure uses silver paste for the seed layer/points to ensure good interface properties, while copper paste is applied above the silver layer for current collection and transmission [25] - Simulation results show that using double-sided silver seed points with copper paste can reduce energy loss by only 0.01mW/cm² compared to the baseline [30] Copper Paste Processing Fees and Profit Impact - Copper paste application can reduce costs by 20%-60%, with a median reduction of 40%, leading to a metalization cost of 4.2-4.8 cents/w [4] - The processing fee for copper paste is estimated at 3.9-4.4 cents/w, with a profit margin of 3.2-3.6 cents/w, significantly higher than silver paste [35] - Under baseline assumptions, the copper paste processing fee market is projected to reach 16.8 billion yuan by 2026, with leading companies potentially generating profits of 3.19-3.59 billion yuan [40] Investment Recommendations - The report recommends **Polyrocks Materials** as a key player in the copper paste market, with a projected EPS of 3.78 yuan by 2026 and a "Hold" rating [44] - **Deke Corporation** and **Suzhou Good-Ark** are also highlighted as companies to watch, though they currently lack specific ratings [44]