Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 42.00 [1][5] Core Insights - The company reported a revenue of CNY 31.82 billion for 2025, representing a year-on-year increase of 16%, which was 4.8% below Bloomberg's expectations. The gross margin remained stable at 22.1%, while the net profit attributable to shareholders was CNY 2.51 billion, reflecting a 40% year-on-year increase, in line with expectations [1] - Key growth drivers include significant revenue growth in thermal products, which saw a 411% year-on-year increase to CNY 1.67 billion, and improvements in optical profitability due to a higher proportion of high-end products and growth in WLG (Wafer Level Glass) lens business [1] - The company is expected to continue gaining market share in 2026, particularly in AI-driven edge innovations and new terminal forms such as robotics and XR (Extended Reality) [1] Summary by Sections Acoustic and Automotive Acoustic - The acoustic business generated revenue of CNY 8.35 billion, up 2% year-on-year, with a gross margin of 27.6%, down 2.6 percentage points. This decline is attributed to the evolution of product forms towards integrated antenna brackets and other components [2] - Automotive acoustic revenue reached CNY 4.12 billion, a 16% year-on-year increase, with the Zeekr 9X model featuring the Naim brand's full-stack acoustic system now in mass production. The company anticipates that brand system penetration may exceed 10% in FY2026 [2] Optical - The optical business achieved revenue of CNY 5.73 billion, a 15% year-on-year increase, with a gross margin of 11.5%, up 5.0 percentage points. This marks five consecutive half-year increases in gross margin [3] - The company has made significant progress with WLG applications, with nearly 15 million units shipped, and expects ASP (Average Selling Price) for plastic lenses to increase by 5%-10% in 2026 [3] Electromagnetic Actuation / Precision Components / Sensors - Revenue from electromagnetic actuation and precision components was CNY 11.77 billion, up 21% year-on-year. The company is expanding into high-value areas such as liquid cooling and XR hardware [4] - The company is also developing portable AI devices in collaboration with major clients, with expected market entry by the end of 2026 or early 2027 [4] Profit Forecast and Valuation - The report adjusts the net profit forecast for 2026 and 2027 upwards by 14% and 19% to CNY 3.01 billion and CNY 3.49 billion, respectively, and introduces a 2028 net profit forecast of CNY 4.06 billion [5] - The target price is adjusted to HKD 42.00, reflecting a PE ratio of 14.6x for 2026, compared to a comparable company average of 24.9x [5]

Investment Rating - The report maintains a "Buy" rating for China Power (2380) [2][8] Core Views - The company achieved a net profit attributable to equity holders of 3.4 billion RMB in 2025, a year-over-year decrease of 11.9%. The total dividend for 2025 is projected at 0.17 RMB per share, with a dividend payout ratio of 70% [3][8] - The restructuring of the red-chip controlled A-share structure is expected to provide strong support for the company's valuation, with a target price of 4.39 HKD based on a 0.8x PB for 2026 [8] Financial Summary - **Revenue Forecast (Million RMB)**: - 2024: 54.213 billion - 2025: 49.029 billion (down 9.6% YoY) - 2026E: 46.648 billion (down 4.9% YoY) - 2027E: 48.244 billion (up 3.4% YoY) - 2028E: 50.409 billion (up 4.5% YoY) [5] - **Net Profit Forecast (Million RMB)**: - 2024: 3.364 billion - 2025: 2.910 billion (down 13.5% YoY) - 2026E: 2.195 billion (down 24.6% YoY) - 2027E: 2.591 billion (up 18.1% YoY) - 2028E: 3.077 billion (up 18.8% YoY) [5] - **Key Financial Ratios**: - PE for 2025: 10.7, 2026E: 12.3, 2027E: 16.4, 2028E: 13.9 - PB for 2025: 0.65, 2026E: 0.61, 2027E: 0.60, 2028E: 0.59 [5] Performance by Segment - **Thermal Power**: - Net profit of 2.27 billion RMB in 2025, up from 1.56 billion RMB in 2024. The profit per kWh is 0.045 RMB, an increase of 0.019 RMB YoY [8] - **Hydropower**: - Net profit of 0.3 billion RMB in 2025, down from 0.51 billion RMB in 2024, affected by reduced rainfall [8] - **Renewable Energy**: - Wind power profit of 2.94 billion RMB in 2025, down from 3.18 billion RMB in 2024. Solar power profit of 0.98 billion RMB, down from 1.72 billion RMB in 2024 [8] Valuation Comparison - The report compares China Power's valuation with peers, noting a PE of 12.3 for 2025 and a PB of 0.61, while the average PE for comparable companies is 7.9 for 2025 [10]

Investment Rating - The report maintains a "Strong Buy" investment rating for Tencent Holdings [6] Core Insights - The company's game business growth exceeded expectations, with a significant increase in AI application investments across various sectors [6] - Tencent's Q4 2025 revenue reached 194.4 billion CNY, a year-on-year increase of 13%, while the Non-IFRS net profit was 64.7 billion CNY, up 17% year-on-year [1][6] - The report forecasts revenue growth for 2026-2028, estimating revenues of 833.4 billion, 915 billion, and 994.9 billion CNY, with adjusted net profits of 279.3 billion, 308.5 billion, and 339.5 billion CNY respectively [6] Business Segment Summaries 1. Online Gaming Business - In Q4 2025, the domestic gaming revenue was 38.2 billion CNY, a 15% year-on-year increase, while overseas gaming revenue reached 21.1 billion CNY, a 32% increase [10][16] - The growth was driven by new game launches and strong performances from established titles like "Honor of Kings" and "PUBG MOBILE" [10][16] 2. Social Networking Business - The social networking segment generated 30.6 billion CNY in Q4 2025, a 3% year-on-year increase, primarily from music subscription services and video live streaming [19] - The number of paid music subscribers rose to 127 million, a 5.3% increase year-on-year, with a paid rate of 24.1% [19] 3. Marketing Services Business - The marketing services segment reported revenue of 41.1 billion CNY in Q4 2025, an 18% year-on-year increase, driven by AI-enhanced advertising capabilities [25] - The introduction of the AIM+ intelligent advertising product matrix has improved advertising efficiency and effectiveness [26] 4. Financial Technology and Enterprise Services - This segment achieved revenue of 60.8 billion CNY in Q4 2025, an 8% year-on-year increase, with significant contributions from financial services and cloud services [32] - Tencent Cloud has achieved scalable profitability, benefiting from rising AI demand and improvements in PaaS and SaaS offerings [32] 5. Profitability and AI Ecosystem Development - The company reported a gross profit of 108.3 billion CNY in Q4 2025, a 19% increase year-on-year, with a gross margin of 56% [38] - Tencent continues to invest heavily in AI, enhancing its capabilities across various applications, including gaming and advertising [39][40]

Investment Rating - Maintain BUY rating for Tuhu Car, indicating potential for significant returns despite short-term profit adjustments [1][8] Core Insights - Tuhu Car is positioned as a beneficiary of industry consolidation, focusing on market share gains rather than immediate profit growth, which is seen as a strategic move amid evolving after-sales service landscapes [1][8] - The company plans to add 1,000 new stores in FY26E, with over 90% of stores that have been open for more than six months being profitable, and the average payback period for new stores has shortened to 30 months [8] - Despite a projected decline in gross profit margin (GPM) due to aggressive pricing strategies, Tuhu is expected to improve operational efficiency and maintain a competitive edge over peers [1][8] Financial Summary - Revenue projections show growth from RMB 13,601 million in FY23A to RMB 19,992 million in FY27E, with year-on-year growth rates of 17.8%, 8.5%, 11.5%, 11.1%, and 9.3% respectively [2][12] - Adjusted net profit is expected to rise from RMB 481.3 million in FY24A to RMB 939.8 million in FY27E, reflecting a significant recovery after a dip in FY24A [2][12] - The target price has been adjusted from HK$23.00 to HK$19.00, representing a 39.2% upside from the current price of HK$13.65 [3][8] Earnings and Valuation - The adjusted net profit for FY26E is projected to be RMB 738 million, a 5% increase year-on-year, while FY27E is expected to see a 27% growth in adjusted net profit [8][10] - The company’s P/E ratio is projected to decrease from 22.8x in FY25A to 14.5x in FY27E, indicating improved valuation metrics over time [2][12] - Gross margin is expected to stabilize at around 24.2% in FY26E, with a slight increase to 24.5% in FY27E [10][12]

Investment Rating - The report maintains a BUY rating for Giant Biogene, expecting earnings pressure to ease progressively through 2026E and injectables to drive medium- to long-term growth [1][8]. Core Views - Giant Biogene reported revenue of RMB5,519 million in 2025, a slight decline of 0.4% YoY, and an attributable net profit of RMB1,915 million, down 7.2% YoY, which was in line with expectations given external headwinds and competition [1][2]. - The gross margin decreased by 1.8 percentage points YoY to 80.3%, primarily due to changes in product mix [1]. - For 2026E, sales growth is expected to recover gradually, driven by stronger brand promotion for KOMFYMED and Collgene, an expanded product portfolio, and the commercialization of newly approved Class III injectables [1][8]. - The target price has been lowered to HK$38.70 from HK$53.89, reflecting a revised revenue and net profit CAGR forecast from 18%/17% to 11%/8% for 2025-28E due to intensified competition [1][3]. Financial Summary - Revenue projections for FY26E, FY27E, and FY28E are RMB6,073 million, RMB6,809 million, and RMB7,522 million respectively, with YoY growth rates of 10.1%, 12.1%, and 10.5% [2][12]. - Attributable net profit is expected to be RMB1,964 million in FY26E, RMB2,201 million in FY27E, and RMB2,432 million in FY28E, with corresponding YoY growth rates of 2.6%, 12.1%, and 10.5% [2][12]. - The P/E ratio is projected to be 14.7x for FY26E, 13.1x for FY27E, and 11.9x for FY28E [2][12]. Product and Market Insights - KOMFYMED's revenue was RMB4,470 million in 2025, down 1.6% YoY, while Collgene grew by 9.2% YoY to RMB918 million [1][8]. - The company plans to launch several key products in 2026E, including KOMFYMED Focus Cream 2.0 and new additions to the Focus and Regular series, to support recovery [1][8]. - Offline direct sales increased by 32% YoY to RMB225 million in 2025, contributing 4.1% to total revenue, driven by the expansion of KOMFYMED offline stores [1][8]. Regulatory and Commercialization Developments - Giant Biogene received NMPA approvals for two Class III injectables in late 2025 and early 2026, with commercialization expected to begin in 2Q26E [1][8]. - The company is preparing for commercialization through market research and distributor selection, leveraging its nationwide sales network [1][8].

Investment Rating - The report maintains a "BUY" rating for AIA Group Ltd. with a target price (TP) raised to HK$112 from the previous HK$89, indicating a potential upside of 30.2% from the current price of HK$86.05 [2][12]. Core Insights - AIA Group Ltd. reported a 15% year-over-year growth in Value of New Business (VONB) to US$5.52 billion for FY25, with a notable share buyback of US$1.7 billion announced for FY26, which was a positive surprise [1][8]. - The company's operating profit after tax (OPAT) grew 8% year-over-year to US$7.14 billion, translating to a 12% increase in earnings per share, aligning with the company's target of 9%-11% compound annual growth rate (CAGR) for OPAT per share from 2023 to 2026 [1][12]. - The report highlights strong performance in Hong Kong, with VONB growth of 28% year-over-year, while AIA China showed resilience with VONB growth rebounding in early 2026 [1][8]. Summary by Relevant Sections Financial Performance - FY25 VONB reached US$5,516 million, with a margin of 58.5%, up 3.6 percentage points year-over-year, slightly exceeding estimates [1][13]. - The total shareholder return for FY25 was US$4.7 billion, comprising US$2.4 billion in dividends and US$2.3 billion in buybacks [1][12]. Growth Strategy - AIA's growth strategy in China is on track, with VONB from new regions accelerating significantly in the second half of FY25 [1][8]. - The company aims for a 4.0% total shareholder return in FY26, supported by the new buyback program and consistent capital returns [12][13]. Valuation Metrics - The new target price of HK$112 implies a price-to-embedded value (P/EV) of 1.7x for FY26, compared to the current trading level of 1.3x [12][13]. - Key assumptions include a terminal growth rate of 2% and a VNB multiplier of 9.4x, reflecting varied risk discount rates across markets [12][13].

Investment Rating - Maintain BUY rating for Xpeng Inc. with a target price of US$24.00 for XPEV US and HK$94.00 for 9868 HK, reflecting an upside of 36.8% and 31.3% respectively from current prices [4][9] Core Insights - Xpeng's 4Q25 net profit exceeded expectations due to R&D service income, with revenue rising 38% YoY to RMB22.3 billion, driven by higher-than-expected technical R&D service income from VW and carbon credit trading [9] - Despite a weak 1Q26 outlook, Xpeng's sales volume in 2H26 is projected to double HoH, supported by aggressive export plans and the introduction of four new models, including two Mona SUVs [9] - The mass production of humanoid robots is anticipated to be a significant catalyst for share price appreciation, with a target of producing 2,000 units by the end of this year and an annual sales goal of 1 million units by 2030 [9] Financial Summary - Revenue projections for FY26E are set at RMB94.37 billion, reflecting a 23% YoY growth, with a gross profit margin (GPM) of 18.5% [11] - Adjusted net profit estimates for FY26E and FY27E have been revised down by 59% and 37% to RMB0.9 billion and RMB2.3 billion respectively, due to lower sales volume outlook and increased R&D expenses [9][11] - The operating loss forecast for FY26E has been adjusted from RMB253 million to RMB1.27 billion [9] Earnings Performance - Xpeng's 4Q25 marked its first-ever net profit of RMB383 million, with a gross margin of 21.3%, the highest in its history [9] - The company aims to achieve a domestic sales volume growth of 17% YoY in FY26E, despite a downward revision of its overall sales volume forecast to 0.54 million units [9] Valuation Metrics - The price-to-sales (P/S) ratio is projected to decrease from 1.8x to 1.7x for FY26E, reflecting the earnings cuts [9] - The price-to-earnings (P/E) ratio for FY26E is estimated at 228.7x, decreasing to 20.5x for FY27E [11][14]

Investment Rating - The report maintains a "BUY" rating for AAC Tech, with a target price of HK$55.27, implying a potential upside of 71.5% from the current price of HK$32.22 [3][16]. Core Insights - AAC Tech's FY25 revenue and net profit are projected to grow by 16% and 40% year-over-year, respectively, driven by improved profitability in optics and strong growth in the automotive and thermal segments [1][9]. - The management provided positive guidance for FY26, expecting revenue growth of 16-17% year-over-year and stable gross profit margins, despite challenges in the smartphone market [1][9]. - The company is well-positioned to leverage emerging opportunities in AI, AR/VR, and automotive sectors, with significant growth expected from thermal and optics businesses [1][9][16]. Financial Summary - FY25 revenue is estimated at RMB 31.8 billion, with a year-over-year growth of 16.4%, while net profit is expected to reach RMB 2.51 billion, reflecting a 39.8% increase [2][10]. - The gross profit margin for FY25 is projected at 22.1%, slightly below previous estimates due to changes in the acoustics product mix [9][10]. - For FY26, revenue is expected to grow to RMB 36.7 billion, with net profit reaching RMB 2.90 billion, indicating continued growth momentum [11][12]. Business Segments - The report highlights robust growth in the thermal VC and sensor & semi segments, with year-over-year increases of 400% and 103%, respectively [9][15]. - The optics business has shown significant profitability improvement, with margins increasing to 11.5% from 6.5% in the previous year, supported by gains in high-end lens markets [9][15]. - The automotive segment is expected to grow by 15-20% year-over-year, contributing to overall revenue growth [9][11]. Valuation - The target price of HK$55.27 is based on a sum-of-the-parts (SOTP) valuation, reflecting different growth profiles across business segments, with a weighted-average target P/E multiple of 20.0x for FY26E [3][16]. - The valuation considers near-term headwinds in the automotive and smartphone industries, adjusting P/E multiples accordingly [16][17].

Investment Rating - The investment rating for the company is "Buy" and is maintained [10]. Core Insights - The company reported a total profit attributable to shareholders of HKD 14.519 billion for 2025, representing a year-on-year increase of 0.9% from HKD 14.388 billion in 2024 [7]. - The core profit from the pure thermal power business (excluding coal business) reached HKD 7.336 billion, a significant year-on-year growth of 79.8% [2]. - The thermal power segment achieved a core profit of HKD 7.639 billion, reflecting a year-on-year increase of 64.68% despite challenges in the coal production business [2]. - The renewable energy segment faced pressure, with a core profit of HKD 7.604 billion, down 17.60% year-on-year due to reduced utilization hours and declining electricity prices [2]. Summary by Relevant Sections Financial Performance - The company's thermal power plants sold 157.8 billion kWh of electricity in 2025, a year-on-year increase of 1.30% [11]. - The average on-grid electricity price for coal-fired power plants decreased by approximately HKD 0.028 per kWh to HKD 0.386 per kWh, leading to a 4.25% decline in electricity sales revenue to HKD 68.842 billion [11]. - The average coal price for the company's coal-fired power plants fell by 13.4% to HKD 798.6 per ton, contributing to a 12.26% reduction in fuel costs [11]. Renewable Energy Business - The company added 13.625 million kW of new renewable energy capacity in 2025, with wind and solar power capacity reaching 29.076 million kW and 15.335 million kW, respectively, marking year-on-year growth of 19.59% and 62.57% [11]. - Despite the increase in installed capacity, the utilization hours for wind and solar power decreased, impacting revenue and profits [11]. Dividend and Future Outlook - The company declared a dividend of HKD 1.127 per share for 2025, maintaining a payout ratio of 40%, which translates to an estimated dividend yield of approximately 5.80% based on the closing price on March 18 [11]. - For 2026, the company plans to add 5.45 million kW of wind and solar capacity, a 60% reduction compared to 2025, with capital expenditures expected to decrease by 2.5% [11]. - Projected earnings for 2026-2028 are HKD 11.088 billion, HKD 12.210 billion, and HKD 12.992 billion, with corresponding EPS of HKD 2.14, HKD 2.36, and HKD 2.51, and PE ratios of 8.86, 8.05, and 7.56, respectively [11].

Investment Rating - The report maintains a "Buy" rating for Alibaba-W (9988.HK) [6] Core Views - Alibaba's AI and cloud segments are in an accelerated growth phase, with the integration of the ATH business group enhancing its full-stack AI capabilities [6] - The company achieved revenue of 284.8 billion RMB in FY26Q3, a year-over-year increase of 1.7%, but adjusted EBITA fell by 57.3% year-over-year, missing Bloomberg consensus estimates by 26% [6] - The management expects a significant recovery in e-commerce and CMR growth in Q1 2026, driven by improving consumer trends [6] Financial Forecasts - Revenue projections for FY2026 to FY2028 are 1,029.93 billion RMB, 1,163.2 billion RMB, and 1,329.26 billion RMB, reflecting growth rates of 3.4%, 12.9%, and 14.3% respectively [2] - Adjusted net profit is forecasted to be 79.31 billion RMB in FY2026, with a significant decline of 49.8% year-over-year, followed by recoveries of 44.3% and 34.8% in FY2027 and FY2028 [2] - The adjusted EPS is expected to be 4.15 RMB in FY2026, with a P/E ratio of 26 [2] Segment Performance - The e-commerce segment generated 159.3 billion RMB in revenue in FY26Q3, a year-over-year increase of 6%, while adjusted EBITA decreased by 43% due to investments in instant retail and user experience [6] - Instant retail revenue grew by 56% year-over-year, contributing to an increase in active buyers on the platform [6] - Alibaba Cloud's revenue reached 43.3 billion RMB in FY26Q3, a year-over-year increase of 36%, with expectations for annual revenue to grow to 100 billion USD within five years [6]