Investment Rating - The industry investment rating is "Overweight" and has been maintained from the previous rating [5] Core Insights - The rise of Scale-up architecture is driven by the increasing demand for high-speed interconnects due to the growth of large model parameters and the need for unified computing units formed by connecting multiple GPUs [1][13] - The Scale-up switch market is expected to grow rapidly, with a projected market size of nearly $6 billion by 2025 and a 5-year CAGR of 26% from 2025 to 2030 [1][68] Summary by Sections Scale-up Supernodes: Breaking Through Single Card Computing Bottlenecks - The demand for larger parameter scales in large language models necessitates the expansion of computing clusters, which can significantly enhance model output accuracy and performance [13] - Cross-node communication requirements are heightened due to the use of tensor parallelism and expert parallelism technologies [17] Overview of Mainstream Supernode Systems - NVIDIA's GB200 NVL72 supernode connects 36 Grace CPUs and 72 NVIDIA Blackwell GPUs using NVLink technology, achieving high bandwidth and low latency [31][32] - Google's seventh-generation TPU Ironwood can scale up to 9216 chips, achieving peak performance of 4614 TFLOPS [35][36] - Amazon's Trainium2 server interconnects 64 chips through NeuronLink, ensuring low latency and high bandwidth communication [45][48] - Huawei's CloudMatrix384 supernode is designed for large-scale AI workloads, achieving 300 PFLOPS of BF16 computing power [49][52] Beneficiaries of Scale-up Network Demand - High-end switching chips and interface chips are expected to see increased demand due to the customized networks required for Scale-up architecture [3] - The integration of hardware and software in supernode systems is likely to enhance the value-added services of hardware manufacturers [56] - The demand for short-distance high-speed copper connections is strong, while optical interconnects are gradually being integrated into Scale-up networks [3] Focus Areas - Key companies to watch include: - Interconnect & Switching Chips: Sanken Communication, Lattice Semiconductor, and Wantong Development [4] - Network Equipment: ZTE, Ruijie Networks, and Unisplendour [4] - Optical Interconnect: Zhongji Xuchuang, New Easy, and Tianfu Communication [4] - Copper Interconnect: Ruikeda, Shenyu Co., and Wolker Materials [4]

Investment Rating - The report indicates a positive investment sentiment towards the North Exchange market, particularly in the new energy sector, suggesting a potential for growth and investment opportunities [4][27]. Core Insights - The North Exchange A-share trading volume reached 23.87 billion yuan on November 13, 2025, an increase of 3.952 billion yuan from the previous trading day, with the North Exchange 50 Index closing at 1529.62, up 2.62% [8][4]. - A total of 282 companies were listed on the North Exchange, with 229 stocks rising, 9 remaining flat, and 44 declining. The top five gainers included Tianhong Lithium Battery (30.0%), Meideng Technology (13.6%), and Derui Lithium Battery (12.1%) [18][4]. - The report highlights that the new energy industry chain performed strongly, with significant contributions from lithium battery chemicals and diversified chemical sectors, indicating a robust market interest [4][21]. Summary by Sections Market Review - On November 13, 2025, the North Exchange A-share trading volume was 23.87 billion yuan, marking a 39.52 billion yuan increase from the previous day. The North Exchange 50 Index closed at 1529.62, reflecting a 2.62% increase, with a PE_TTM of 72.59 [8][4]. - The North Exchange specialized index closed at 2531.88, up 1.86% [8]. Stock Performance - Among the 282 companies, 229 saw an increase in stock prices, while 44 experienced declines. The top five gainers were Tianhong Lithium Battery (30.0%), Meideng Technology (13.6%), and Derui Lithium Battery (12.1%) [18][4]. - Conversely, the top five decliners included Ruixing Co. (-4.7%) and Chicheng Co. (-3.5%) [18][4]. Investment Recommendations - The report suggests that the North Exchange market is experiencing heightened activity, driven by increased investor interest in the new energy sector. The report emphasizes the long-term investment value of companies in specialized and innovative sectors [4][27]. - The report notes that the global monetary easing cycle continues, favoring small-cap stocks, which aligns with the characteristics of companies listed on the North Exchange [4].

Group 1: Market Strategy and Economic Outlook - The report indicates that the Hong Kong stock market is poised for a rebound, driven by the easing of US dollar liquidity, which is expected to benefit major asset classes [5][8][9] - The report recommends an overweight position in Hong Kong stocks, A-shares, and commodities, while maintaining a neutral position in Chinese bonds and increasing exposure to US stocks and bonds [9] Group 2: Transportation Industry Insights - The express delivery sector is anticipated to benefit from anti-involution policies, with prices starting to rise since September 2025, indicating a positive trend for future growth [11] - The oil shipping industry faces challenges due to an aging fleet, with the average age of large oil tankers reaching a historical high of 13 years, while new orders are insufficient to meet future capacity needs [12] - The aviation sector is expected to enter a supply-demand resonance cycle, with a low growth rate in aircraft supply and a positive outlook for passenger volume growth in 2025 [13] Group 3: Construction and Building Materials Sector - The construction and building materials industry is at a bottoming phase, with a need for transformation due to insufficient domestic demand and increasing uncertainties from overseas [2][15] - The report highlights the importance of mergers and restructuring among state-owned enterprises to address excess capacity in the construction sector [2] - Recommendations include focusing on major construction blue-chip stocks and international engineering firms, as well as domestic cyclical stocks that are expected to benefit from demand recovery [2] Group 4: Macro Financial Data - In October, loan growth slowed, with new loans amounting to 220 billion yuan, significantly lower than the previous year's 500 billion yuan, reflecting ongoing challenges in the real estate market [18] - The report notes a decrease in social financing growth, with new social financing at 814.9 billion yuan, down from 1.41 trillion yuan in the previous year [19] - The M1 and M2 money supply growth rates have also declined, indicating tighter liquidity conditions [19] Group 5: Company-Specific Developments - Meili Tianyuan Medical Health's acquisition of Siyuanli for 1.25 billion yuan is expected to solidify its position as a leader in the high-end beauty sector, with the integration projected to enhance overall performance [21][22] - The report anticipates that the acquisition will lead to a significant increase in the number of active members and improve operational efficiency through resource synergies [22][23] - The company plans to utilize 1.2 billion HKD for dividends and buybacks over the next three years, highlighting its commitment to shareholder returns [23]

Core Conclusions - The construction sector has seen a cumulative increase of 10.83% from the beginning of 2025 to November 11, 2025, underperforming the broader market, while the building materials sector has increased by 22.32%, outperforming the market [7][18] - The overall construction market is experiencing a decline in scale, with significant business homogenization, necessitating a transformation within the industry, particularly among large state-owned construction enterprises [7][46] - The cement industry is under pressure, with a projected 6% decline in demand for the year, while supply-side policies aimed at capacity reduction and carbon emissions are expected to be key drivers for future adjustments [8][9] Industry Review - The construction and building materials sectors have shown varied performance, with the construction sector ranking 20th out of 30 industries in terms of cumulative growth, while the building materials sector ranks 10th [18][20] - The cement sector has faced declining sales volumes for most companies in 2025, with a significant increase in inventory levels due to poor peak staggering [8][9] - International engineering projects are seeing sustained growth, particularly in regions involved in the Belt and Road Initiative, with many state-owned construction companies reporting an increase in overseas orders [8][9] Investment Recommendations - The report suggests focusing on large construction blue-chip stocks such as China Railway and China Communications Construction, while also considering companies involved in international engineering and those with cyclical elasticity in domestic demand [9] - The report emphasizes the importance of high dividend yields from undervalued state-owned construction companies as a potential investment opportunity [8][9] Financial Performance Summary - The revenue decline in the construction sector has narrowed, while profit pressures continue, with significant improvements in cash flow noted [9][57] - For the cement industry, revenue declines have expanded, and profit growth has slowed, indicating ongoing challenges [9][57] - The eight major state-owned construction enterprises reported a total revenue of 4.81 trillion yuan for the first three quarters of 2025, reflecting a year-on-year decline of 3.99% [61]

Core Conclusions - The U.S. government shutdown has ended after 43 days, marking the longest shutdown in U.S. history, following the signing of a temporary funding bill by President Trump [1] - The release of significant liquidity from the Treasury General Account (TGA), which had accumulated nearly $1 trillion during the shutdown, is expected to ease global liquidity constraints [2] - The resumption of employment data disclosures, including non-farm payrolls, is likely to reignite expectations for interest rate cuts, as the labor market may show signs of weakness due to the shutdown's impact [3] - With the U.S. government reopening and a shift towards looser dollar liquidity, a rebound in risk assets, particularly Hong Kong stocks, is anticipated [4] - A strategic asset allocation favoring Hong Kong innovative pharmaceuticals, Hang Seng Technology, and gold is recommended, as broader asset classes are expected to benefit from the easing liquidity conditions [5] Global Major Asset Changes - Domestic CPI and PPI have unexpectedly improved, reinforcing inflation expectations, with CPI turning positive at 0.2% and PPI's decline narrowing to -2.1% [16][18] - October exports unexpectedly turned negative year-on-year, influenced by high base effects, while exports to the U.S. increased, indicating resilience in trade with emerging markets [17] - The prolonged U.S. government shutdown has led to liquidity tightening, impacting various asset classes, but this is expected to improve with the government's reopening [21] - The ADP employment data showed unexpected improvement, suggesting a potential increase in labor supply due to the shutdown's effects on government employees [25] - The Federal Reserve officials are leaning towards a cautious approach regarding interest rate cuts, with limited future rate reductions anticipated [29] Recent Major Asset Review - Domestic stock markets experienced a mixed performance, with the Shanghai Composite Index rising by 0.27% while the CSI 300 fell by 0.66% [33] - U.S. and European stock markets saw declines due to the government shutdown and tightening liquidity, with the Nasdaq dropping by 3.04% [35] - U.S. Treasury yields increased amid uncertainties regarding interest rate cuts, with the 10-year yield rising to 4.10% [37] - Commodity prices fell, with WTI crude oil and Brent oil prices decreasing by 2.02% and 1.76%, respectively, due to concerns over demand [40] - The U.S. dollar index fluctuated, ultimately decreasing by 0.20%, while the onshore and offshore RMB experienced slight depreciation [42]

Group 1: Express Delivery Industry - The express delivery sector is expected to benefit from anti-involution policies, with prices starting to rise since July 2025 due to government measures against low-price and disorderly competition [13][15][20] - In September 2025, major express companies reported a year-on-year increase in single ticket prices, indicating the initial success of the anti-involution policies [24][21] - The express delivery volume is projected to maintain good growth, with a compound annual growth rate of 11.6% from 2023 to 2028 [34][32] Group 2: Oil Transportation Industry - The average age of VLCC (Very Large Crude Carrier) ships reached a historical high of 13 years in August 2025, indicating a need for capacity renewal [52][51] - There is a significant gap between the number of new orders and the required capacity updates, with only 112 VLCCs expected to be delivered by 2029 against a potential scrapping of 319 older vessels [58][56] - Global oil production and consumption are expected to grow in the coming years, which may positively impact oil transportation demand [43][42] Group 3: Aviation Industry - The aviation sector is anticipated to enter a supply-demand resonance cycle, with a projected low growth rate in aircraft supply over the next eight years [71][73] - Most airlines are expected to see good growth in passenger numbers in 2025, with overall load factors remaining high [80][84] - Government policies aimed at promoting consumption and addressing competition in the aviation sector are expected to boost demand in 2026 [90][92]

Group 1: Key Conclusions - The report highlights Guangqi Technology (光启技术) as a leader in the metamaterials industry, having built a comprehensive industrial system from scratch, including a headquarters, five bases, seven capability platforms, and eight specialized companies, making it a global leader in metamaterials with integrated R&D, design, mass production, and testing capabilities [1][6][7] - The company is expected to see significant revenue and profit growth as its five bases gradually come into production, benefiting from increased product penetration [1][6][8] Group 2: Financial Projections - For Guangqi Technology, the projected net profit for 2025-2027 is estimated at 9.58 billion, 18.83 billion, and 23.49 billion CNY, with year-on-year growth rates of 47.0%, 96.6%, and 24.7% respectively [6][8] - Fortec Technology (富特科技) is expected to achieve revenues of 37.77 billion, 48.57 billion, and 61.05 billion CNY, with net profits of 2.13 billion, 3.22 billion, and 4.68 billion CNY for the same period [10][11] - Shengke Communication (盛科通信) is projected to have revenues of 13.53 billion, 17.76 billion, and 21.95 billion CNY from 2025 to 2027, with growth rates of 25.1%, 31.3%, and 23.6% respectively [13][14] - Weimais (威迈斯) is forecasted to generate revenues of 70.59 billion, 85.67 billion, and 100.80 billion CNY, with net profits of 6.57 billion, 8.74 billion, and 10.49 billion CNY for the same period [16][18] Group 3: Industry Insights - The metamaterials market is expected to grow at a compound annual growth rate (CAGR) of 60.3% from 2025 to 2031, with significant applications in defense and military, wireless communication, and optics [8] - The report emphasizes the importance of metamaterials in advanced equipment, particularly in defense applications, and highlights Guangqi Technology's unique position as the only company in China to achieve large-scale industrialization of metamaterials for next-generation aerospace equipment [6][8] Group 4: Company Developments - Fortec Technology has seen a significant increase in its Q3 performance, with a revenue of 25.59 billion CNY for the first three quarters of 2025, representing a year-on-year increase of 116.31% [10][11] - Shengke Communication has achieved a positive net profit for the first three quarters of 2025, with a revenue of 8.32 billion CNY, reflecting a 3% year-on-year growth [13][14] - Weimais reported a Q3 revenue of 16.38 billion CNY, with a net profit of 1.53 billion CNY, indicating a strong growth trajectory [16][18]

Investment Rating - The investment rating for the company is "Buy" [6][11]. Core Views - The company has shown significant year-on-year growth in Q3, with a 5.45% increase in main business revenue to 4.597 billion yuan and a 43.64% increase in net profit attributable to shareholders to 425 million yuan [1][3]. - The company is a leader in the domestic vehicle power supply sector, with strong R&D capabilities and scale advantages, indicating substantial growth potential as product iterations and overseas customer demand continue to rise [3][6]. Financial Performance Summary - For the first three quarters of 2025, the company achieved a main business revenue of 4.597 billion yuan, up 5.45% year-on-year, and a net profit of 425 million yuan, up 43.64% year-on-year [1]. - In Q3 2025, the company reported revenue of 1.638 billion yuan, with a quarter-on-quarter increase of 3.06% and a year-on-year increase of 1.93%. The net profit attributable to shareholders was 153 million yuan, reflecting a quarter-on-quarter increase of 90% [1][6]. - The gross margin and net margin for Q3 2025 were 23.02% and 9.73%, respectively, showing slight decreases from the previous quarter [1]. Product Development and Market Position - The company shipped over 600,000 vehicle power supply products in Q3, maintaining a market share of approximately 24% and ranking first among third-party suppliers [2]. - The fourth-generation vehicle power supply integrated products accounted for over 20% of revenue in Q3 2025, with a strategy of "producing one generation, researching one generation, and pre-researching one generation" to enhance product competitiveness and overall gross margin [2]. - The company plans to invest 190 million yuan in building an electric drive assembly production base, with a construction period of one year [2]. Future Projections - Revenue projections for 2025-2027 are 7.059 billion yuan, 8.567 billion yuan, and 10.080 billion yuan, respectively, with net profits expected to be 657 million yuan, 874 million yuan, and 1.049 billion yuan [3][4]. - The company anticipates significant growth driven by product updates and increasing overseas customer demand, particularly from major European clients launching new vehicle platforms in the coming years [2][3].

Group 1: Fixed Income Market Outlook - The 2026 outlook indicates significant pressure for banks to realize floating profits, while insurance companies will continue to rebalance between equities and bonds supported by premium growth [6][7] - Brokerages are expected to increase their allocation to interest rate bonds and enhance returns through various tools [6][10] - Asset management products will see a slowdown in growth rates post-net worth transformation, with funds facing impacts from declining yields and new redemption regulations [6][11] Group 2: Far East Horizon (03360.HK) - Far East Horizon has evolved into a comprehensive group with financial services as its shield and industrial operations as its spear, being the first listed financing leasing company in China [15][16] - The company is expected to maintain stable leasing volumes and benefit from a decrease in funding costs, alongside profit expansion in its industrial operations due to its overseas strategy [15][16] - The revenue structure is shifting, with the industrial operations segment projected to account for 42.71% of total revenue by 2024, reflecting the effectiveness of its dual-driven strategy [16] Group 3: Beautycounter (300957.SZ) - The company is undergoing operational adjustments, focusing on channel optimization and product concentration, with expectations of returning to stable growth by 2026 [19][20] - Revenue for the first three quarters of 2025 was 3.464 billion yuan, a year-on-year decrease of 13.78%, but showing signs of improvement due to strategic adjustments [19][20] - The company anticipates earnings per share (EPS) of 1.02, 1.22, and 1.43 yuan for 2025, 2026, and 2027 respectively, maintaining a "buy" rating [20] Group 4: Top Group (601689.SH) - The company achieved a revenue of 20.9 billion yuan in the first three quarters of 2025, with a year-on-year growth of 8.1%, while net profit decreased by 12% [22][23] - Revenue projections for 2025-2027 are 29.9 billion, 36.5 billion, and 43.1 billion yuan, reflecting growth rates of 12%, 22%, and 18% respectively [24] - The company is expanding its international presence and developing new products in robotics and AI liquid cooling servers, with significant orders already secured [24]

Investment Rating - The report initiates coverage on Far East Horizon with an "Accumulate" rating [1][6][19] Core Views - Far East Horizon has evolved from being the first listed financing leasing company in China to a comprehensive group with financial services as its "shield" and industrial operations as its "spear" [1][23] - The company is expected to benefit from stable leasing investment and a decrease in funding costs, alongside profit expansion in its industrial operations due to its overseas strategy [1][19] Summary by Sections Company Overview - Established in 2011, Far East Horizon is the first listed financing leasing company in China, now a comprehensive group integrating financial and industrial services [1][23] - The company has undergone several phases of development, transitioning from a traditional leasing company to a comprehensive service provider [24][25] Financial Performance - The revenue structure is shifting towards industrial operations, which are projected to account for 42.71% of total revenue by 2024, reflecting a 4.03 percentage point increase year-on-year [2] - The company has maintained stable growth in its financial services, with a focus on compliance and risk control, while also expanding its inclusive finance business [2][54] Business Segments - The financial services segment remains the core, with leasing as the primary focus, while the industrial operations segment includes equipment and healthcare services [40] - The equipment operation segment has shown significant growth, with revenue increasing from 1.8 billion in 2018 to 11.6 billion in 2024, reflecting a CAGR of 36.54% [46] Asset Quality - Far East Horizon has improved its asset quality significantly, with non-performing asset formation rates projected to be 0.50%, 0.43%, and 0.23% for 2023, 2024, and 2025H respectively [3][32] - The company has implemented a prudent project investment strategy to control the quality of new business and reduce the scale of urban public projects [3] Profit Forecast and Valuation - The forecasted total revenue for 2025-2027 is 376.10 billion, 375.77 billion, and 384.89 billion respectively, with a slight decline in growth rates expected [15] - The report anticipates a rebound in net profit margins, with projected net profits of 40.51 billion, 42.32 billion, and 44.30 billion for the same period [15][19]