Investment Rating - The report maintains a "Buy" rating for Miniso (MNSO) with a 12-month price target of $23.40, indicating an upside potential of 5.5% from the current price of $22.19 [1]. Core Insights - Miniso reported a 19% year-over-year revenue growth in 1Q25, slightly above guidance, but adjusted operating profit declined by 5% year-over-year, missing expectations due to higher contributions from lower-margin direct-to-consumer (DTC) sales and new store openings [1][2]. - Management remains optimistic about top-line growth for 2025, but has tempered expectations regarding margins due to the ongoing transition to a DTC model [1][2]. - The company aims for a positive same-store sales growth (SSSG) recovery, with management targeting double-digit growth in China and a 40% year-over-year increase in overseas markets [19][20]. Summary by Sections Earnings Review - In 1Q25, total sales reached Rmb 4.4 billion, reflecting a 19% year-over-year increase, with overseas sales growing by 30% year-over-year [29]. - The adjusted net profit was Rmb 587 million, which was 6% lower than expectations, primarily due to lower-than-expected operating profit [32][34]. Financial Forecasts - Revenue forecasts for 2025-2027 have been adjusted slightly downward, with total sales projected at Rmb 20.55 billion for 2025, reflecting a 20.9% growth [37]. - The adjusted net profit for 2025 is now estimated at Rmb 2.22 billion, a 14.7% decrease from previous estimates [37]. Operational Insights - The company closed 111 stores in Mainland China during 1Q25, which was below expectations, while opening 95 stores overseas [31]. - Management highlighted that the DTC model will continue to exert pressure on margins in the near term, but expects improvements in operational efficiency to mitigate this impact [19][20]. Market Strategy - Miniso's strategy includes a focus on increasing the number of larger format stores and enhancing same-store sales productivity, with plans to open fewer stores than previously targeted [25]. - The company is also investing in its IP strategy, which has shown positive market feedback, particularly in the toy category, which accounted for 30% of sales in 1Q25 [27][28].

Investment Rating - The report does not explicitly provide an investment rating for the industry or specific companies Core Insights - The report highlights the impact of US tariffs on various sectors including appliances, autos, industrial tech, and solar companies, indicating a cautious recovery in production and shipment from China [1][4][19] China Consumer Durables - On average, companies in the consumer durables sector derive 35% of revenues from exports to overseas markets and 7% from exports to the US [2] - Companies are partially resuming production in China, but the pace of recovery varies based on global production capacity [4] - Tariff costs are largely borne by US clients, influencing manufacturers' decisions to resume production in China [4][5] China Autos - Auto OEMs derive 6%-26% of total revenue from China exports and 0%-10% from exports to the US [7] - Companies are cautious about restocking due to high warehousing costs and potential demand decline [7][8] - Some auto suppliers report stable or increasing orders post-tariff reduction, with minimal impact from US-China trade tensions [8][9] China Industrial Tech - Companies in the industrial tech sector are experiencing weakening domestic demand for capital goods, particularly among consumer goods manufacturers [12][14] - Despite a reduction in tariffs from 145% to 30%, the effective tariff burden remains around 55% for thin-margin manufacturers, leading to hesitance in new investments [14][17] China Solar - Solar exporters have seen a meaningful recovery in US shipments following tariff rollbacks, with companies restocking inventory ahead of upcoming regulations [19][20] - There is limited room for further pricing negotiations due to rising demand uncertainty and previous price increases [19][20] - Companies are becoming more cautious about capital allocation to the US, seeking diversified geographical exposure instead [20][21]

Investment Rating - The report maintains a "Buy" rating for Tencent Holdings (0700.HK) with a 12-month target price of HK$595, indicating a potential upside of 15.2% from the current price of HK$516.50 [2][20]. Core Insights - Tencent's unique WeChat ecosystem and global gaming assets provide multiple monetization levers, enabling the company to deliver compounding earnings through macro cycles [2]. - The company is positioned as a key beneficiary of AI applications, particularly through its WeChat super-app and Tencent Cloud, which ranks among the top three public cloud players in China by scale [2]. - The report highlights the tangible benefits from AI-driven adtech upgrades, leading to improved click-through rates (CTR) across various advertising properties [12]. - Tencent's gaming segment continues to thrive, with record gross receipts from evergreen titles, indicating strong user engagement and productivity in game development [12]. - The fintech business has significant growth potential, particularly in wealth management and lending, with a focus on improving blended take rates [16]. Advertising - Advertising has benefited from AI-driven upgrades, with Video Account and Moments being the top two revenue streams in Weixin advertising [12]. - The company has not aggressively monetized live streaming e-commerce yet, viewing it as a transaction element within the Weixin ecosystem [12]. Gaming - Tencent's evergreen games, such as HoK and PKE, continue to achieve record grossing after years of operation, with expectations for healthier economics and reduced reliance on channels [12]. - The company is exploring cross-platform launches and maintaining close relationships with investee studios globally, focusing on Europe and Asia [12]. AI Investment and Monetization - Tencent is committed to investing a low teens percentage of revenue in capital expenditures, primarily for in-house AI model development and applications [12]. - The company is strategically focusing on PaaS and SaaS for external cloud services, aiming for more sustainable margins [12]. Fintech - The fintech segment emphasizes risk management as a top priority, with expectations for improved blended take rates and growth opportunities in wealth management and lending [16]. - The company anticipates a narrowing gap between revenue growth and operating profit growth through reinvestment of operating leverage from high-margin revenue streams into AI initiatives [16]. Financial Projections - Total revenues are projected to grow from RMB 660.26 billion in 2024 to RMB 836.65 billion by 2027, with a compound annual growth rate (CAGR) of approximately 8% [20]. - The report forecasts a significant increase in net profit, with non-GAAP net profit expected to rise from RMB 222.70 billion in 2024 to RMB 299.63 billion by 2027 [20].

Investment Rating - The report indicates that mutual funds ended 1Q25 approximately 175 basis points overweight in the Financials sector, although this is a decrease of about 45 basis points quarter-over-quarter [2]. Core Insights - The reduction in overweight positioning may reflect the impact of tariffs on the broader economic outlook affecting financials and a pushback in capital markets activity [2]. - The Insurance subsector remains an overweight that grew over 1Q25, while Capital Markets exposure was reduced during the same period [2]. - Exposure to Insurance increased quarter-over-quarter by 7 basis points, while exposure to Capital Markets decreased by 14 basis points [2]. - The report suggests that while this positioning may not directly reflect the Australian market, it serves as a useful proxy for investor sentiment towards the insurance and diversified financials sector, particularly in the US market [2]. Summary by Sections - **Mutual Fund Positioning**: Mutual funds had the most overweight exposure to Insurance, which grew over 1Q25, while Capital Markets exposure was reduced [4][8]. - **Sector Analysis**: The report notes that investors remain favorably positioned towards insurers, which appears to be more General Insurance (GI) weighted, relevant to companies like SUN, IAG, QBE, SDF, and AUB within the coverage [2]. - **Market Trends**: The data reflects positioning as of the end of March 2025, with the possibility of changes since then [2].

Investment Rating - The report does not explicitly state an overall investment rating for the luxury goods industry, but it indicates a preference for companies with high-end exposure and diversified large/mid caps with margin defensiveness, while remaining cautious on turnaround stories in a tough industry backdrop [7]. Core Insights - The luxury goods market is experiencing price increases across various brands, particularly in the US, as companies aim to offset inflation and tariffs. Brands such as Louis Vuitton, Moncler, Burberry, and Hermès have implemented notable price hikes [2][7]. - The pricing tracker indicates that overall price gaps across regions have decreased, with the US experiencing a tightening price gap with Europe despite recent price increases [3][5]. - China remains the most expensive market for luxury goods, with a premium of approximately 20-25% compared to Europe. However, there is ongoing softness in the luxury market in China, raising questions about consumer appetite [6][7]. Summary by Sections Pricing Trends - Several luxury brands have increased prices in the US, with notable increases from Louis Vuitton (+L-MSD), Moncler (+LSD), and Burberry (+HSD) [2]. - The current price increases are designed to offset a 10% level of additional tariffs, with potential for more global price increases if tariffs rise further [7]. Regional Analysis - The US has seen a recent weakening of the dollar, which has tightened the price gap with Europe, making luxury goods less attractive for American consumers traveling to Europe [3][5]. - Chinese consumers are showing strong demand for luxury goods, particularly in Japan, where spending nearly doubled year-on-year in FY24 [6]. Brand-Specific Observations - Moncler has the largest price gap between Europe and China at approximately 30%, but this gap has compressed significantly over the past decade [7]. - The report highlights that brands are likely to focus on narrowing the price gap between China and Europe, with Moncler seeing further opportunities to reduce this gap [7].

Investment Rating - The investment rating for the humanoid robotics industry is generally positive, with a focus on component stocks such as Sanhua (Buy), LeaderDrive (Neutral), and Best (Neutral) [30]. Core Insights - The humanoid robotics industry is progressing towards commercialization by integrating generalizable intelligence with practical applications, relying on four core technologies: algorithms, data, computing power, and hardware [5][19]. - The industry forecast anticipates shipments of 20,000 units in 2025 and 1.4 million global humanoid robot shipments by 2035 [30]. Summary by Sections Industry Overview - A recent field trip to humanoid robot companies in Beijing and Shenzhen highlighted a consensus on the need for robots to combine intelligence with practical applications [1]. - The focus is shifting towards developing the "brain" of humanoid robots, with significant investments in data factories to collect real-world interaction data [1][12]. Technology Development - The Vision-Language-Action (VLA) model is recognized as a feasible solution for humanoid robots, integrating vision and action to enhance task execution [6][7]. - High-quality real-world data is deemed critical for training models, with a requirement of approximately 10 million hours of data to achieve general-purpose autonomy [12][11]. Data Collection and Infrastructure - Companies are investing between US$100 million to US$200 million in data factories to support the extensive data collection needed for training [12]. - There is an ongoing debate regarding the effectiveness of different types of data (2-D video, teleoperational data, and simulation data) for training embodied AI systems [11]. Computing Power - Nvidia's Jetson Orin is currently the dominant computing platform, although local startups are exploring partnerships with Huawei to build domestic computing infrastructure [18]. Hardware Innovations - Dexterous hands are identified as a key focus for hardware improvement, essential for fine motion control and data collection [19]. - The humanoid robot pricing ranges from US$15,000 to US$100,000, with expectations of cost reductions through scale production and component optimization [23]. Practical Applications - Initial commercial opportunities are seen in industrial applications such as materials handling and sorting, while consumer applications are still considered distant due to regulatory hurdles [20][22]. - Companies report achieving up to 95% accuracy in materials handling tasks, with small-scale adoption expected to begin in 2025-2026 [20].

22 May 2025 | 9:10PM SGT Global Refining Fundamentals improving on supply delays, closures and crude outlook The refining setup is increasingly echoing the 2015-17 upcycle, with favorable feedstock dynamics (OPEC+ returning barrels, strong non-OPEC supply) combined with tightening global refining supply-demand. This time, the tightness is more supply driven. Our tracking shows several new refineries slated for 2025-27 are delayed, while fresh capacity closure announcements continue in developed markets. We ...

We hosted Meitu (1357.HK, Not Covered) CFO on May 21 at our TechNet Conference China 2025. Key discussions were around productivity tools growth, AI foundation model, and product line-up. Overall, management is positive on the expansion of AI productivity tools to improve efficiency and generate high-quality content (images, talking head videos etc.) within seconds. The number of subscribers continues to grow, and management see significant upside in the paying ratio vs. overseas AI productivity software. D ...

23 May 2025 | 2:03AM HKT Xiaomi Corp. (1810.HK): Released XRING flagship SoC and 4G baseband chip; Positive read from YU7 technology highlights; Buy On the 15th anniversary strategic product launch event on May 22, Xiaomi officially released XRING O1, Xiaomi's first self-designed 3nm flagship SoC (System-on-Chip) carried on its flagship Xiaomi 15S Pro smartphone model and premium Xiaomi Pad 7 Ultra tablet model, and XRING T1, Xiaomi's first self-designed 4G baseband processor carried on Xiaomi Watch S4 eSIM ...

Investment Rating - The report provides a mixed investment rating for various companies in the basic materials sector, with specific recommendations such as "Buy" for companies like Angang-H and Conch-H, while others like Maanshan-A and Chinacoal-H are rated as "Sell" [10]. Core Insights - The overall sentiment in the basic materials sector is that current demand is less concerning than previously anticipated, with a notable deceleration in local government special refinancing bond issuance impacting infrastructure recovery [1]. - Current Chinese demand for cement and construction steel is reported to be 12-14% lower year-on-year, while copper demand has increased by 9% [1]. - The downstream order book trend has remained mostly stable month-on-month, with 31% of respondents indicating a lower trend in May for basic materials [2][3]. Summary by Sections Downstream Demand Snapshots - Infrastructure recovery has paused due to a lack of funding for new projects, leading to weak cement shipments [1]. - The demand for construction materials is showing signs of weakness, particularly in cement and construction steel, while copper demand remains resilient [1]. Steel Production - Steel production cuts are in preparation, with a potential reduction in prices if these cuts are implemented [1]. - The report notes that rush orders following the reduction of US-China tariffs were limited, primarily driven by Southeast Asia [1]. Commodity Prices - The pricing for steel and cement has remained stable, while prices for aluminum and copper have improved, contrasting with the softening of coal and lithium prices [1]. Specific Company Insights - Angang-H is rated as "Buy" with a target price of CNY 2.40, indicating a potential upside of 45% [10]. - Conch-H is also rated as "Buy" with a target price of CNY 29.00, reflecting a 37% upside potential [10]. - Companies like Maanshan-A and Chinacoal-H are facing downward pressure, rated as "Sell" with target prices significantly lower than current prices [10].