钢铁行业：行业盈利修复提速，龙头优势凸显

Investment Rating - The report maintains a "Recommend" rating for the steel industry [1] Core Insights - The overall profitability of the steel industry is recovering rapidly, with effective cost control measures leading to significant improvements in profit margins [5][6] - In Q3 2025, the steel sector achieved record profits, with net profit margins increasing quarterly, indicating a sustainable recovery in profitability [7][10] - The recovery in profitability is broadening, with leading companies showing faster recovery rates compared to their peers, highlighting the advantages of scale and cost management [19][24] - Investment recommendations focus on companies with stable high dividends, those with high technical barriers, and upstream resource companies benefiting from improved supply dynamics [27] Summary by Sections 1. Industry Profitability Recovery and Cost Control - The profitability of the steel industry has shown significant improvement, with a total profit of 111.5 billion yuan from January to November 2025, a year-on-year increase of 1,752.2% [5] - The SW steel sector reported a net profit of 20.147 billion yuan in the first three quarters of 2025, marking a turnaround from losses in the previous year [5][6] 2. Record Profits in Q3 2025 - In Q3 2025, the steel sector generated revenue of 480.123 billion yuan, a slight year-on-year increase of 0.07%, while costs decreased by 4.42% [7][8] - The net profit for Q3 2025 reached 8.716 billion yuan, reflecting a 12.16% increase from the previous quarter and a significant recovery from losses in the same period last year [7][10] 3. Broadening Profit Recovery and Leading Companies - Leading steel companies like Baosteel and Shougang have demonstrated strong profit recovery, with Shougang's net profit increasing by 368.13% year-on-year [19][20] - The recovery in profitability is not limited to top firms; several smaller companies have also turned losses into profits, indicating a broad improvement across the sector [24] 4. Investment Recommendations - The report suggests focusing on companies with stable high dividends, such as CITIC Special Steel and Hualing Steel, as well as those with high technical barriers like Fangda Special Steel [27] - Upstream resource companies like Baotou Steel and Hainan Mining are also recommended due to expected improvements in supply dynamics [27]