Industry Overview - The report focuses on seven key industries in China that contribute 22% to GDP growth, with five industries currently operating at overcapacity, leading to zero or negative cash margins for over 50% of their capacity [1] - The industries analyzed include solar modules, lithium batteries, electric vehicles, power semiconductors (IGBT), construction machinery, air conditioners, and steel [5][6] - China's global supply share in these industries ranges from 66% to 86%, with significant export growth observed from 2020 to 2023, particularly in lithium batteries (720% growth) and electric vehicles (670% growth) [8][22] Supply-Demand Imbalance - Five out of the seven industries have China's capacity exceeding global demand, with solar modules at 200% and lithium batteries at 150% of global demand [10][21] - Capacity utilization rates in 2023 ranged from 30% to 87%, with solar modules at 44% and electric vehicles at 54% [8][21] - Over 50% of the supply in most industries operated at zero or negative cash margins in Q1 2024, with solar modules and steel being the worst performers [31][37] Cyclical Inflection Points - The report identifies solar modules and lithium batteries as industries closest to a cyclical inflection point due to negative cash margins and reduced capex plans, while electric vehicles and power semiconductors are further away [1][11] - Capex revisions over the past 12 months show significant cuts in lithium batteries (-41% for 2024E) and solar modules (-5% for 2024E), while power semiconductors saw a 130% increase in capex plans [33][37] - The tipping point for capex adjustments is expected when over 50% of the supply is in net debt and EBITDA interest coverage falls below 5x, with solar modules and lithium batteries likely to reach this point sooner [37][39] Global Market Impact - China's share in ex-China markets is expected to stagnate or decline, with solar modules and lithium batteries potentially losing 4-19% of their market share by 2028 [42][43] - Chinese producers are increasingly building capacity outside China, with lithium batteries and electric vehicles leading this trend, particularly in the US and Europe [40][43] - Trade tensions, particularly with the US and EU, pose risks to China's exports, with 40-60% of solar modules, lithium batteries, and electric vehicles exported to these regions [24][26] Industry-Specific Insights - **Solar Modules**: China's capacity is 200% of global demand, with a 46% price decline in Q1 2024. The industry is expected to see a cyclical bottom by 2025, with one-third of capacity likely to shut down [66][67] - **Electric Vehicles**: China's capacity is 120% of global demand, with 42% of exports going to the US and EU. The industry is not yet at a tipping point, with 50% of firms still generating positive cash margins [71][72] - **Lithium Batteries**: China's capacity is 150% of global demand, with a 41% capex cut for 2024E. The industry is close to a tipping point, with significant consolidation potential [11][33] - **Power Semiconductors (IGBT)**: Capex plans have increased by 130% for 2024E, but the industry is 2-3 years away from a cyclical inflection point due to strong demand and high capex [33][37] - **Steel, Construction Machinery, and Air Conditioners**: These industries are expected to remain structurally oversupplied, with limited cyclical improvements [11][45]

1公众学： 本本论委 24 July 2024 | 6:20PM BST The EM Trader Leaning Defensive into H2 ■ Paradise Delayed for EM assets? Coming into this year, we argued that EM_ assets, having weathered the storm of higher US rates, a stronger Dollar and weak China activity, could deliver more balanced positive returns as the global macro weather changed for the better. However, our expectations of a more convergent growth outlook and non-recessionary cuts has at least been delayed if not denied altogether. Whereas US growth has sl ...

更多资料加入知识星球：水木调研纪要 关注公众号：水木纪要 Goldman Sachs Understanding US Economic Statistics Edward F. McKelvey, Editor 高盛 理解美国经济统计 中文版 翻译：音十 更多一手调研纪要和研报数据加V：shuinu9870 更多资料加入知识星球：水木调研纪要 关注公众号：水木纪要 音十译 neozhh@hotmail.com 序言: 在面对越来越复杂的金融环境面前，普通投资者缺乏对整体宏观经济层面的理解。美国 作为世界经济最重要的一环，其经济基本面影响着全球经济的一举一动。当某个关键经济指 标发布时，可以对资本市场造成很大的波动，甚至是趋势的改变。 美国经济基本面的一切完全由经济数据所反映，作为世界上统计机制最完善，最详细的 国家，美国经济数据的复杂程度远非一般人所能了解。美国政府有关部门和其他商业机构， 每月发布几百份数据报告，在多达数十万条的经济指标面前，哪些数据扮演什么样的角色对 于理解美国经济有着很大的作用。 译者发现《高盛：理解美国经济统计数据》对于美国经济数据有着一个较好的归纳。将 其中核心经济指标的发布源、发 ...

22 July 2024 | 6:28PM BST 公众平：永木论委 Precious Analyst China's Structurally Resilient Gold Demand ■ The gold price set a new all-time high of $2,483/toz on Wednesday (Julys17) as expected Fed cuts are poised to bring Western capital back into:the gold market. Following rising interest from Western investors, and ounanalysis of structurally higher demand from central banks, we dive into the third major component of global gold demand: Chinese households. Jaan Struyyen man Sachs & Co. LLC ■ Physical Demand Domin ...

16 July 2024 2 更多资料加入知识星球：水木调研纪要 关注公众号：水木纪要 6437aaa8de6c4611b8ac8998231c2d63 Goldman Sachs Baidu.com Inc. (BIDU) that a global fleet of a few million commercial AVs used for rideshare could be on the road in 2030. China now has c. 4-5mn ridehailing cars total in operation; for illustrative purposes, if we assume 5% Robotaxi penetration in the long term and similar pricing to normal taxis, this would translate to RMB35bn/US$5bn in TAM size. Apart from Robotaxi, Baidu is likely to see near term softness in ad ...

Financial Data and Key Metrics Changes - There was a sharp rise in commercial power consumption in Virginia of 37% from 2016 to 2023, contrasting with flat power consumption in other sectors and states [5][32] - Data centers in Virginia contributed an estimated 2.2 GW to power consumption in 2023, with a peak of 2.3 GW in February 2023 [11][38] - US total power demand is expected to grow from 470 GW to 567 GW from 2023 to 2030, with a significant contribution from data centers [38] Business Line Data and Key Metrics Changes - Commercial power consumption in Virginia has outpaced non-commercial power consumption, with residential and industrial power consumption slightly declining by 3% and 4% respectively from 2016 to 2023 [32][38] - Data center power demand is projected to triple from 15 GW to 45 GW by 2030, contributing 30% to the total power consumption growth in the US [39] Market Data and Key Metrics Changes - The growth of data centers has been highly concentrated in Virginia, with similar patterns observed in Nevada, where commercial power consumption has also increased significantly [9][38] - The overall magnitude of the boost in power demand from data centers remains modest compared to the total US power demand [38] Company Strategy and Development Direction - The analysis indicates a need for investment in energy infrastructure to support the rising power demand driven by data centers and AI [13][25] - The expectation is that US power consumption growth will accelerate sharply to an annual average of 2.4% from 2022 to 2030, outpacing GDP growth for the first time in three decades [26][31] Management Comments on Operating Environment and Future Outlook - Management highlighted the challenges posed by potential power transmission bottlenecks that could constrain future growth of data centers, emphasizing the need for infrastructure investment [13][25] - The anticipated acceleration in power demand growth is significant as it has not occurred in three decades, indicating a shift in market dynamics [26][31] Other Important Information - The report utilized a statistical "doppelganger" technique to estimate the impact of data centers on Virginia's power consumption, providing a counterfactual analysis [11][25] - The report notes that while data centers are concentrated in Virginia, their contribution to total US power demand is still relatively small, at 0.5% of current total demand [38] Q&A Session Summary Question: How is AI and data center growth impacting US power demand? - AI and data centers are expected to significantly boost US power demand, particularly in regions like Virginia, but the overall impact remains modest compared to total demand [38] Question: What are the projections for future power consumption growth? - Analysts expect US power consumption growth to accelerate to an annual average of 2.4% from 2022 to 2030, driven by data centers, AI, and electric vehicles [26][31] Question: What challenges could affect data center growth? - Potential power transmission bottlenecks could constrain future growth, highlighting the need for investment in energy infrastructure [13][25]

Good morning. My name is Katie, and I will be your conference facilitator today. I would like to welcome everyone to the Goldman Sachs second quarter 2024 earnings conference call. On behalf of Goldman Sachs, I will begin the call with the following disclaimer. The earnings presentation can be found on the investor relations page of the Goldman Sachs website and contains information on forward-looking statements and non-GAAP measures. This audio cast is copyrighted material of the Goldman Sachs Group, Inc. ...

Summary of Goldman Sachs Q2 2024 Earnings Conference Call Company Overview - The conference call is hosted by Goldman Sachs, a leading global investment banking, securities, and investment management firm [1] Key Points and Arguments - The earnings presentation is available on the investor relations page, which includes forward-looking statements and non-GAAP measures [1] Other Important Content - The call is facilitated by Katie, indicating a structured approach to the conference [1]

Financial Data and Key Metrics Changes - The 1-year Total Return Swap (TRS) Spread for CSI1000 is close to 1200 basis points, indicating a potential upside exposure of approximately 3 times for every 1 time downside on small caps [2][41]. Business Line Data and Key Metrics Changes - The analysis indicates that small caps have shown a decline in performance relative to large caps, with small caps underperforming by about 3% over the next three months according to the rotation model developed [41]. Market Data and Key Metrics Changes - Chinese small caps, represented by the CSI1000 index, have fallen 19% year-to-date, lagging large caps by 20% [60]. - The average market capitalization of CSI1000 constituents is approximately US$1.3 billion, with a balanced sector composition and significant exposure to manufacturing and technology [60]. Company Strategy and Development Direction - The company has developed a screening process for 30 high-quality China small caps, focusing on those with market capitalizations between US$500 million and US$5 billion, strong growth outlooks, and a history of surpassing earnings consensus [41]. - The portfolio of selected small caps is expected to grow earnings by 14% annually over the next two years, trading at 13.3 times forward P/E and 0.7 times forward PEG [41]. Management's Comments on Operating Environment and Future Outlook - Management notes that the small-cap premium has diminished in recent years, with small caps no longer consistently outperforming large caps since the market turmoil in 2014/15 [40]. - The current market sentiment is subdued, influenced by domestic regulatory risks and potential re-escalation of US-China tensions [41]. Other Important Information - The CSI1000 index is trading at 15.9 times 12-month forward P/E, which is 0.8 standard deviations below its historical average, indicating that valuations are not stretched if earnings can be delivered [71]. - Small caps are traded at a 40% discount relative to their regional peers in India and Japan, suggesting potential for catch-up rallies if market conditions improve [73]. Q&A Session Summary Question: What are the prospects for small caps in the current market? - The analysis suggests that small caps are likely to underperform large caps modestly in the near term, with potential risks stemming from regulatory policies and market sentiment [41]. Question: How does the current valuation of small caps compare to historical averages? - Small caps are currently trading at a significant discount compared to their historical averages, which may present opportunities for investors if earnings growth materializes [71][73].

Financial Data and Key Metrics Changes - The unprecedented oversupply in the current downturn has led to sharper average selling price (ASP) declines, with mainstream solar prices more than halving since June 2023, dropping below industry average cash cost levels [12][13] - Poly prices have declined by 89% in just 18 months, significantly faster than previous downturns [13][23] - The cash burn for Tier 1 players is estimated to last only 8-10 months under current conditions, indicating potential liquidity issues [13][24] Business Line Data and Key Metrics Changes - Tier 1 companies are expected to maintain funding support due to their strong balance sheets, while non-Tier 1 companies are facing faster cash burn and fewer profits accumulated during 2021-2023 [14][24] - The shift from P-type PERC to N-type Topcon technology is accelerating, with 85% N-type adoption expected by the end of 2023 [15][19] Market Data and Key Metrics Changes - The U.S. market accounts for approximately 7% of global solar installations, with over 80% of U.S. imported modules produced in ASEAN [2][8] - The upcoming U.S. tariff reviews on ASEAN exports could significantly impact the profitability of Chinese solar players [7][9] Company Strategy and Development Direction - The industry is expected to see accelerated consolidation towards leaders with strong balance sheets, R&D capabilities, and cost advantages [12][20] - The Chinese government is encouraging technology advancement and regulating local government investments in the solar industry to support high-quality development [17][19] Management Comments on Operating Environment and Future Outlook - Management has noted early signs of a favorable policy stance in China aimed at curbing new capacity and predatory pricing, which could help stabilize the market [12][19] - The focus on tech-driven investment is expected to break the subsidy-driven cycle seen in past downturns, leading to a more sustainable industry environment [19][51] Other Important Information - The Action Plan for energy consumption control and decarbonization for 2024-2025 requires new polysilicon capacity to meet advanced industry standards [19] - The market share of leading solar players has increased, with less local government ownership compared to previous years [39][41] Q&A Session Summary Question: What are the expected impacts of U.S. tariffs on solar imports? - The management indicated that any significant U.S. tariff hike poses a potential risk for Chinese solar players, particularly affecting exports from ASEAN [2][7] Question: How is the industry adapting to the current downturn? - The management highlighted that Tier 1 players are better positioned to weather the downturn due to optimized balance sheets and diversified geographical revenue exposure [20][51] Question: What is the outlook for solar technology advancements? - The management noted that the rapid evolution of solar technology, particularly the shift to N-type cells, is expected to enhance efficiency and production capabilities [15][19]