Investment Rating - The report maintains a "Buy" rating for Hyperstrong with a 12-month target price of Rmb 106 per share, indicating an upside potential of 17.9% from the current price of Rmb 89.88 [15][10][3] Core Insights - The Battery Energy Storage System (BESS) is emerging as a critical solution for managing electricity grid stability during summer heatwaves in China, with record peak loads reaching 1,465 GW, an 11% year-over-year increase [1] - Hyperstrong is identified as a key beneficiary of the growing BESS demand, with projected volume growth rates of 65% in 2025, 43% in 2026, and 36% in 2027, leading to an estimated 38% EPS CAGR from 2024 to 2027 [3][13] - The cumulative tendering volume for BESS in China reached approximately 170 GWh in the first half of 2025, reflecting a 121% year-over-year increase, surpassing previous growth expectations [2][8] Summary by Sections BESS Demand and Market Trends - The demand for BESS continues to exceed expectations, with June 2025 tendering volume in China reaching 56.7 GWh, a 292% year-over-year increase [2][9] - The report notes a significant time lag of 4-8 months between tendering and installation, alleviating concerns regarding the exit of mandatory ESS installation policies [2] Company Positioning and Financial Projections - Hyperstrong is positioned as a leading BESS supplier in China, holding approximately 12% market share in 2024, with expectations of a decline to 6% by 2030 due to increased competition [13][3] - The report forecasts a 20% EPS growth from 2024 to 2030, supported by a 33% volume growth [3][13] Catalysts for Growth - Key near-term catalysts for Hyperstrong include sizable supply contracts, the launch of differentiated products, vertical integration strategies, and supportive policy reforms for the BESS business model [3][14]

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - China's headline CPI inflation increased to +0.1% year-over-year (yoy) in June from -0.1% yoy in May, driven by rising non-food goods prices [1][4] - Headline PPI inflation fell to -3.6% yoy in June from -3.3% yoy in May, primarily due to declining commodity prices, indicating deeper deflationary pressures [1][10] - The full-year PPI inflation forecasts for 2025 and 2026 have been revised down to -2.8% and -1.0% yoy respectively, reflecting weaker-than-expected PPI data [1][11] Summary by Sections Consumer Price Index (CPI) - CPI rose to +0.1% yoy in June from -0.1% yoy in May, with a month-on-month (mom) annualized increase of +1.9% [2][4] - Food inflation slightly improved to -0.3% yoy in June from -0.4% yoy in May, with pork prices falling by 8.5% yoy [5][8] - Non-food CPI inflation increased to +0.1% yoy in June from 0.0% yoy in May, with household item prices rising by 0.6% yoy [6][9] Producer Price Index (PPI) - PPI inflation decreased to -3.6% yoy in June from -3.3% yoy in May, with significant declines in upstream sector prices [10][11] - The NBS attributed the deeper PPI deflation to falling export prices and seasonal declines in raw materials [10] - PPI inflation for producer goods fell to -4.4% yoy in June, while consumer goods remained flat at -1.4% yoy [10] Trade Data Forecast - The report anticipates a 6.0% yoy increase in exports for June, up from 4.8% yoy in May, and a 2.0% yoy rise in imports, contrasting with a decline of -3.4% yoy in May [12]

Investment Rating - The report assigns a Neutral rating to iFlytek, indicating that the valuation is fairly priced [1][9]. Core Insights - iFlytek's management is optimistic about the potential of its self-developed foundation models and generative AI applications, particularly in the education and healthcare sectors [1][4]. - The company plans to continuously enhance its Spark X1 reasoning model, with upgrades expected in July 2025, to better meet client demands across various industries [2]. - iFlytek's education business is expected to benefit from generative AI, with a focus on personalized learning and interactive courses, which will strengthen its market position [3]. - The enterprise business outlook remains positive, with customized foundation models being developed for various industries, enhancing competitiveness [4]. Summary by Sections Spark X1 Upgrades - iFlytek upgraded its Spark X1 reasoning model in April 2025 and plans further upgrades in July 2025, aiming to provide tailored AI solutions for different sectors [2]. AI Education Updates - The management is positive about the education segment, leveraging generative AI to boost AI learning machine shipments and enhance product competitiveness through personalized learning paths [3]. Enterprise Business Outlook - iFlytek is focused on providing total solutions for enterprises, including customized foundation models and application software, to facilitate the adoption of generative AI across various industries [4].

Investment Rating - The report maintains a "Buy" rating on WH Group with a 12-month price target of HK$8.6 per share, indicating an upside of 15.9% from the current price of HK$7.42 [7]. - A "Neutral" rating is assigned to Shuanghui with an unchanged 12-month price target of Rmb25.2 per share, reflecting a modest upside of 2.4% from the current price of Rmb24.62 [8][18]. Core Insights - WH Group is expected to see a cyclical recovery in its US hog production business, with full-year profit forecasts uplifted to US$67 million, significantly above the company's guidance range [9][14]. - The China operations of WH Group are projected to return to a growth trajectory, with operating profit expected to grow by 8% year-over-year in 2Q25, following a decline of 14% in 1Q25 [9][10]. - The report anticipates WH Group's recurring operating profit in 2Q25 to grow approximately 13% year-over-year, one of the highest among traditional food companies [9][15]. Summary by Sections WH Group Financials - WH Group's market capitalization is HK$95.2 billion (approximately US$12.1 billion) with a revenue forecast of US$25.9 billion for 2025 [7]. - The company is expected to achieve an EBITDA of US$3.2 billion in 2025, with a P/E ratio of 8x for 2025E and a dividend yield of 7% [7]. - The report highlights a projected EPS of US$0.12 for 2025, with a consistent growth trajectory anticipated in subsequent years [7]. Shuanghui Financials - Shuanghui's market capitalization is Rmb85.3 billion (approximately US$11.9 billion) with a revenue forecast of Rmb59.7 billion for 2025 [8]. - The company is expected to achieve an EBITDA of Rmb8.8 billion in 2025, with a P/E ratio of 17.8x for 2025E and a dividend yield of 5.5% [8]. - The report projects an EPS of Rmb1.48 for 2025, indicating stable performance in the coming years [8]. Operational Insights - WH Group's China business is expected to stabilize in packaged meat and narrow upstream losses, although fresh meat remains under pressure due to a tough comparison base [9][10]. - The US business is projected to see a 3% year-over-year sales growth in packaged meat, with EBIT expected to decline by 3% year-over-year [13][14]. - The international segment is anticipated to trend upwards sequentially, with efficiency enhancements contributing to stable performance [15].

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - The FOMC is positioned to wait for more clarity on inflation and economic activity, with a careful approach to adjusting monetary policy due to elevated uncertainty [2][3] - Most participants believe that some reductions in the fed funds rate would likely be appropriate this year, with a median forecast of two cuts in 2025 [3][4] - The Fed staff's economic forecast indicates higher GDP growth through 2027 compared to previous forecasts, primarily due to trade policy announcements [4][8] Summary by Sections FOMC Meeting Minutes - Participants generally agreed on a wait-and-see approach regarding inflation and economic activity, noting that uncertainty had decreased since the May meeting [2] - A few participants suggested that tariffs might only lead to a one-time price increase, while most noted the risk of persistent inflation effects [4] Economic Forecasts - The Fed staff's forecast includes higher GDP growth through 2027 and a lower inflation projection than in May, with expectations for inflation to return to the 2% target by 2027 [8] - The staff anticipates that tariff increases will raise inflation this year and provide a small boost in 2026 [8] Communication Strategy - A preliminary discussion was held regarding potential changes to the Summary of Economic Projections and the addition of alternative scenarios to the FOMC's communications strategy [9]

9 July 2025 | 1:20PM SGT Base Metals Comment: Copper: Pricing a Higher Copper Tariff Eoin Dinsmore +65-6889-2401 | eoin.dinsmore@gs.com Goldman Sachs (Singapore) Pte Lavinia Forcellese +44(20)7774-9243 | lavinia.forcellese@gs.com Goldman Sachs International Aurelia Waltham +44(20)7051-2547 | aurelia.waltham@gs.com Goldman Sachs International Daan Struyven +1(212)357-4172 | daan.struyven@gs.com Goldman Sachs & Co. LLC Samantha Dart +1(212)357-9428 | samantha.dart@gs.com Goldman Sachs & Co. LLC Alec Phillips ...

Investment Rating - The report maintains a "Buy" rating for Eoptolink and Innolight, with target prices raised significantly to reflect updated volume estimates and market conditions [73]. Core Insights - The optical transceiver industry is expected to experience robust growth driven by a rising attach ratio of transceivers to GPUs and ASICs, with significant increases in volume estimates for 800G and 1.6T transceivers [2][7]. - The demand for 800G transceivers is projected to reach 19.9 million units in 2025 and 33.5 million units in 2026, representing increases of 10% and 58% respectively [2][16]. - The report highlights two key investment themes: the potential for second-tier transceiver makers like HG Tech to benefit from demand overflow and the valuation convergence between Eoptolink and Innolight [3][44]. Summary by Sections Industry Outlook - The optical transceiver market is expected to grow by 60% in 2025 and 52% in 2026 in dollar terms, primarily driven by higher volumes of 800G and 1.6T transceivers [16][73]. - The attach ratio of transceivers to GPUs is increasing, with the latest B300 GPU requiring 4 to 4.5 transceivers, compared to 2 to 3 for earlier models [8][53]. Company-Specific Insights - Eoptolink's target price has been raised from Rmb 97.1 to Rmb 177, reflecting an 82% increase, while Innolight's target price has been adjusted from Rmb 115 to Rmb 160, a 39% increase [73]. - Eoptolink is expected to achieve a net profit growth of 163% in 2025, while Innolight is projected to grow by 43% in the same year [74]. Investment Themes - The report identifies HG Tech as a potential beneficiary of demand overflow due to its established capacity and ongoing product testing for 800G transceivers [44][50]. - The convergence in valuation between Eoptolink and Innolight is anticipated, with Eoptolink trading at a discount despite similar profit levels and growth rates [26][27]. Key Metrics - The report outlines significant changes in revenue and net profit estimates for the companies covered, with Eoptolink's net profit expected to increase by up to 42% from 2025 to 2027 [2][73]. - The optical transceiver market is projected to require substantial new capacity to meet the anticipated demand, particularly for 800G transceivers [45][72].

Investment Rating - The report maintains a "Sell" rating on both Sangfor and Venustech, indicating a cautious outlook on the cybersecurity sector [2][17]. Core Insights - The management of Qi An Xin sees generative AI as a significant opportunity in the cybersecurity market, which could lead to increased demand for upgraded cybersecurity solutions due to the intensification of cyber attacks [4][9]. - The integration of generative AI is expected to enhance the accuracy and efficiency of cybersecurity software, particularly in risk detection and analysis, which could attract more clients [4][7]. - There is a noted trend of clients shifting their software budgets from functional tools to generative AI software, which is anticipated to drive average revenue per user (ARPU) and attract new paying customers [2][4]. Summary by Sections Company Profile - Qi An Xin, founded in 2014, specializes in cybersecurity, providing software and services to government and enterprise clients. The company has advanced capabilities in endpoint security, cloud security, threat intelligence, and situation awareness [3]. Generative AI Opportunities - Management believes that generative AI will trigger an increase in cyber attacks, creating a potential for upgrading cybersecurity solutions. The company plans to launch the QAX-GPT Security Robot in 2024, which will utilize its self-developed QAX security foundation model to assist security professionals [4][7]. Integrated Cybersecurity Framework - Establishing an integrated cybersecurity framework is deemed more critical than deploying standalone security products. Management emphasizes that platform-based solutions with broad coverage and interoperability will enhance user experience [8]. 2025 Performance Outlook - The management expresses low visibility on near-term demand recovery in the cybersecurity market due to macroeconomic constraints affecting client budgets, particularly in government sectors. However, there is a positive outlook for demand from certain enterprise clients, such as financial institutions and telecom operators [9]. The company is focusing on leveraging generative AI to enhance product offerings and reduce operational costs while improving cash flow [9].

Investment Rating - The report assigns a "Buy" rating to Kingsoft Office, Kingdee, and Empyrean [5][31]. Core Insights - The momentum of AI-native applications and software with AI features remains strong, particularly in the areas of agentic AI and multi-modal AI models [1][4]. - AI agents are expected to become the new user interface for enterprises, enhancing productivity through proactive responses to environmental changes [4][12]. - The release of upgraded multi-modal AI models focuses on generating and editing various content types with improved quality and lower costs [4][13]. - There is a solid project pipeline for enterprise application wins, particularly in AI model deployment, indicating a larger scale of AI projects compared to traditional ERP or system upgrades [21][4]. Summary by Sections AI Agents and Applications - AI agents are being adopted by enterprises to complete tasks independently, with companies like Manus launching general AI agents and Kingdee introducing multiple specialized AI agents [4][12]. - The report highlights the potential of AI agents to improve user experiences in various sectors, including finance and travel [4][12]. Multi-modal AI Models - Recent upgrades in multi-modal AI models have been made by vendors, focusing on high-quality content generation across different media types [4][13]. - Companies like Stepfun and Wondershare are developing advanced tools for image and video editing, enhancing user capabilities [4][13]. Software Project Wins - The report reviews enterprise application project wins, noting a solid momentum in AI model deployments from late April to the present [21][4]. - The scale of AI projects is generally larger due to the inclusion of integrated solutions, which often require higher computing hardware costs [21][4]. EDA and IP Software Expansion - Local EDA suppliers are accelerating product launches to capture localization opportunities, with new tools being introduced for mixed-signal SoC and digital simulation [4][21].

Investment Rating - The report raises the S&P 500 return forecasts to +3% (6400), +6% (6600), and +11% (6900) for the next 3, 6, and 12 months respectively, indicating a positive outlook for the index [2][3]. Core Insights - The report attributes the revised forecasts to earlier and deeper Fed easing, lower bond yields, and the fundamental strength of large stocks, leading to a revised forward P/E forecast of 22x [2][8]. - EPS growth forecasts are maintained at +7% for both 2025 and 2026, but there are risks to these estimates due to the shifting tariff landscape [12][23]. - The report anticipates a broadening of the market rally in the coming months, despite current narrow market breadth, which is one of the lowest in decades [17][23]. Summary by Sections S&P 500 Forecasts - The S&P 500 return forecasts have been raised to +3% (6400), +6% (6600), and +11% (6900) for the next 3, 6, and 12 months respectively, up from previous targets of 5900, 6100, and 6500 [2][3]. - The report indicates that the new year-end S&P 500 forecast ranks at the upper end of strategist estimates [3]. Earnings and Valuation - The forward P/E forecast has been revised to 22x from 20.4x, supported by improved economic conditions and investor sentiment [8][12]. - EPS growth forecasts remain at +7% for both 2025 and 2026, with the report noting potential risks due to tariffs and inflation [12][23]. Market Dynamics - The report highlights a narrow market breadth, with the median S&P 500 constituent over 10% below its 52-week high, suggesting a potential for a "catch up" among laggards [17][23]. - The report expects that as the Fed resumes its cutting cycle, the market will likely see further upside, supported by neutral investor positioning [23][29]. Investment Recommendations - Three key investment strategies are recommended: 1. Balanced sector allocation with overweights in Software & Services, Materials, Utilities, Media & Entertainment, and Real Estate [38]. 2. Focus on Alternative Asset Managers, which have lagged despite an improving capital markets backdrop [45]. 3. Target companies with high floating rate debt, which are expected to benefit from lower bond yields [52].