Investment Rating - The investment rating for Chongqing Changan Automobile is Overweight [7]. Core Insights - The report highlights a resilient performance in Q1 2025, with a net profit after tax (NPAT) of Rmb1.35 billion, reflecting a year-on-year growth of 16.8%, despite a revenue decline of 7.7% to Rmb34.1 billion [1][2]. - The report anticipates a notable narrowing of losses in the NEV (New Energy Vehicle) segment, as indicated by a reduction in minority interest losses [1]. - Gross margin improved modestly by 1.1 percentage points year-on-year to 13.9%, although it remains below the previous year's margin of 14.9%, suggesting ongoing pricing pressures [2]. - The investment thesis is strengthened by the visibility of profit growth driven by advancements in NEV technology [2]. Summary by Sections Financial Performance - Q1 2025 NPAT: Rmb1.35 billion, YoY growth of 16.8% [1]. - Revenue decreased by 7.7% to Rmb34.1 billion [1]. - Gross margin increased by 1.1 percentage points YoY to 13.9% [2]. NEV Business Outlook - Expected significant reduction in losses related to the NEV business, with minority interest losses decreasing from Rmb302 million in Q1 2024 to Rmb137 million in Q1 2025 [1]. - The report emphasizes improving profit growth visibility into 2025 due to NEV advancements [2]. Market Position - The price target for Chongqing Changan Automobile is set at Rmb17.90, indicating a potential upside of 45% from the current price of Rmb12.35 [7]. - The company has a market capitalization of Rmb105.43 billion [7].

Investment Rating - The investment rating for Pharmaron is Equal-weight [4] Core Insights - The industry view is considered Attractive, with a price target set at Rmb27.40, indicating a 3% upside from the current price of Rmb26.61 [4] - In 1Q25, Pharmaron reported revenue of Rmb3,099 million, reflecting a 16% year-over-year growth, aligning with the 2025 guidance of 10-15% growth [7] - The revenue streams from North America, EU, and China showed year-over-year growth of 16.8%, 26.6%, and 13.1%, respectively, contributing approximately 65%, 18%, and 15% to total revenue [2] - The customer base saw revenue from the top 20 pharmaceutical customers grow by 29% year-over-year, while other customers grew by 14% [2] - Adjusted non-IFRS net profit for 1Q25 was Rmb349 million, a 3.1% increase year-over-year, with softer growth attributed to depreciation and amortization costs from biologics capacity launch [7] Summary by Sections Financial Performance - 1Q25 revenue was Rmb3,099 million, up 16% year-over-year, consistent with the guidance for 2025 [7] - Net operating cash flow increased by 14.4% to Rmb853 million, with capital expenditures of Rmb556 million, up 11.4% year-over-year [2] Customer and Market Dynamics - Revenue from the top 20 pharma customers increased by 29% year-over-year, while other customers saw a 14% growth [2] - New order growth for both Lab services and CMC was over 10%, although it decelerated from over 20% in 2024 due to a higher order base in 1Q24 [7] Valuation Metrics - The company has a market capitalization of Rmb29,328.6 million and an enterprise value of Rmb33,234.4 million [4] - The projected EPS for the fiscal years ending in 2024, 2025, and 2026 are Rmb0.97, Rmb1.26, and Rmb1.00, respectively [4]

Investment Rating - The report maintains a "Buy" rating for BYD with a target price of HKD 491.00 [6][21][19] Core Insights - BYD reported a revenue of CNY 170 billion in 1Q25, reflecting a year-on-year increase of 36% but a quarter-on-quarter decline of 38% due to a shipment of 1 million NEVs, which is a 60% increase year-on-year [1][8] - The gross profit margin (GPM) for BYD in 1Q25 was 20.1%, down 0.6 percentage points year-on-year, indicating ongoing fierce competition in the market [1][8] - Operating profit for BYD was CNY 5.6 billion, a 39% increase year-on-year, while net profit reached CNY 9.2 billion, doubling year-on-year [1][8] Summary by Sections Financial Performance - Revenue for 1Q25 was CNY 170.36 billion, a 36% increase year-on-year but a 38% decrease quarter-on-quarter [8] - Operating profit was CNY 5.6 billion, up 39% year-on-year, while net profit was CNY 9.2 billion, reflecting a 100% increase year-on-year [1][8] - The GPM was 20.1%, down from 20.7% in 1Q24, indicating a decline in profitability due to competitive pressures [1][8] Market Dynamics - The report highlights that BYD continues to benefit from its business scale despite a competitive environment, with sales and marketing expenses growing at a slower pace than revenue [1][4] - Recent government policies tightening smart driving function promotions have affected order volumes across the industry, prompting a shift in focus towards pricing strategies [2][3] Strategic Initiatives - BYD has initiated time-limited promotions with price cuts of 8-17% on select models to stimulate demand [4] - The company aims to improve liquidity through a proposed distribution of bonus shares, increasing the total number of shares from 3,039 million to 9,117 million [5][21]

Investment Rating - The report maintains a "Buy" rating for Aluminum Corp of China (Chalco) H/A shares, with target prices adjusted to HKD6.10 for H-shares and RMB9.80 for A-shares, implying upside potentials of approximately 42% and 48% respectively [5][40]. Core Insights - Chalco reported a net profit after tax (NPAT) of approximately RMB3.5 billion in 1Q25, reflecting a 5% quarter-on-quarter increase and a 59% year-on-year increase, attributed to better-than-expected sales volume and average selling prices (ASP) for aluminum and alumina [1][9]. - The company expects capital expenditures of RMB14.8 billion in 2025, focusing on wind power projects and new alumina production sites, while aiming to increase green power usage from 47% in 2024 to 55% in 2025 [2][9]. - Despite solid fundamentals for aluminum, earnings are expected to decline by approximately 12% in 2025 due to lower alumina prices, with the alumina price already below breakeven levels [3][9]. Financial Performance - In 1Q25, Chalco's sales volumes for self-produced aluminum decreased by 5% quarter-on-quarter, while alumina sales increased by 6% quarter-on-quarter. However, revenue and gross profits fell by 12% and 29% quarter-on-quarter respectively due to a significant drop in alumina prices [1][31]. - The company recorded a decrease in selling, general and administrative (SG&A) expenses by 6% year-on-year and 66% quarter-on-quarter, indicating effective cost control [1][31]. - Investment income rose by RMB0.37 billion in 1Q25, driven by higher alumina prices year-on-year and gains from hedging [36]. Production and Operational Strategy - Chalco's aluminum production operating rate reached 95% in China, supported by demand from electric vehicles, batteries, and solar products [3][9]. - The company plans to relocate alumina production from inland to coastal provinces to reduce transportation costs and expects to close down 1-2 million tons of alumina production in 2025 [2][34]. - Chalco aims to optimize its alumina capacity of 25 million tons by utilizing lower-cost imported bauxite, which may lead to some impairment losses [34]. Market Outlook - The report anticipates steady aluminum prices in 2025, supported by robust demand from the "New Three" sectors, while alumina prices are expected to have limited downside due to their current low levels [3][9]. - The coal price and electricity costs remained weak in 1Q25, which may benefit Chalco's operational costs [3][9].

Investment Rating - The report maintains a "Buy" rating for Kstar and Envicool, while Kehua is rated as "Neutral" [2][11]. Core Insights - The data center supply chain in China is experiencing strong demand, with expectations for continued capacity expansion through 2025 and potentially into 2026, despite challenges such as overseas chip supply constraints [1][5]. - The report has revised earnings per share (EPS) estimates downward by 17%-31% for Kstar, Envicool, and Kehua, primarily due to uncertainties in domestic solar inverter and energy storage system (ESS) demand, as well as intense pricing competition [1][7]. - Kstar is favored over Kehua due to its faster long-term growth potential, better margin profile, and more attractive valuation metrics [2][5]. Kstar Summary - Kstar's sales and net income for 4Q24 decreased by 9% and 76% year-over-year, respectively, while 1Q25 showed a 14% increase in sales but a 17% decrease in net income [5][8]. - The company anticipates 30%-50% year-over-year order growth from domestic internet and telecom customers in 2025, with significant opportunities for customer base expansion [6][9]. - Kstar's total revenue is projected to grow from Rmb 4.159 billion in 2024 to Rmb 9.642 billion by 2030, with a net income increase from Rmb 394 million to Rmb 1.455 billion over the same period [10]. Envicool Summary - Envicool's 4Q24 and 1Q25 results missed expectations due to delayed revenue recognition and increased operating expenses, leading to a 31% downward revision in EPS estimates [11][15]. - The data center room cooling segment saw sales growth of 49% in 2024, with a record high order backlog by 1Q25, indicating strong demand [13][14]. - Envicool's total revenue is expected to rise from Rmb 3.529 billion in 2024 to Rmb 4.589 billion in 2025, with net profit projected to increase from Rmb 344 million to Rmb 453 million [16].

Investment Rating - The report downgrades the investment rating of Sungrow Power Supply from Buy to Neutral, with a target price reduced from CNY 100 to CNY 58 [3][5][21]. Core Insights - The earnings for 1Q25 exceeded expectations due to strong growth in the energy storage system (ESS) segment, with revenue growth of 50.9% year-on-year [1]. - Despite strong shipment forecasts for 2025, the report expresses caution regarding potential earnings due to tariff headwinds and increased competition in emerging markets [2][3]. - The company has suspended ESS shipments to the US market, which typically offers better gross margins, impacting future earnings [2][3]. Summary by Sections Financial Performance - Sungrow reported 4Q24 revenue of CNY 27.9 billion, an 8.0% year-on-year increase, and 1Q25 revenue of CNY 19.0 billion, a 50.9% year-on-year increase [1]. - The net profit for 4Q24 was CNY 3,437 million, up 55% year-on-year, and for 1Q25, it was CNY 3,826 million, up 83% year-on-year [1]. Shipment Forecasts - For 2025, solar and ESS shipments are estimated at 160GW (up 9% year-on-year) and over 40GWh (up 43% year-on-year), respectively [2]. - The company reported solar inverter and ESS shipments of 147GW and 28GWh in 2024, aligning with previous estimates [1]. Valuation Metrics - The new target price of CNY 58 is based on a P/E ratio of 11.3x for 2025F, reflecting a decrease from the previous 16x due to anticipated margin pressures [3][13]. - The report indicates a projected normalized EPS decline from CNY 5.67 to CNY 5.12 for 2025F [3][4]. Market Context - The report highlights intensified competition in the Middle East market, which may further limit Sungrow's shipment and earnings growth in 2H25 [2]. - The company is facing challenges from increased anti-dumping and countervailing duties affecting solar module shipments to the US [2].

Investment Rating - The report assigns a "Sell" rating to Aier Eye Hospital Group due to missed expectations and lack of growth visibility [16][5][12]. Core Insights - Aier reported FY24 revenue of Rmb21 billion, a 3% year-over-year increase, and a net profit of Rmb3.6 billion, reflecting a 5.9% year-over-year growth, which was below consensus estimates [1][5]. - The company experienced a significant contraction in gross profit margin in 4Q24, dropping to 38.0% from 47.0% in 4Q23, attributed to increased promotions and lower margins from newly consolidated hospitals [2][5]. - Management indicated that while there was strong growth in January and February 2025, the overall growth prospects for FY25 remain uncertain due to market conditions [1][4]. Financial Performance Summary - FY24 net profit was Rmb3.6 billion, with a diluted EPS of Rmb0.385, representing a 5.9% growth [6]. - The company expects revenue growth to be driven primarily by small hospitals in the domestic market, while overseas expansion lacks visibility [4][5]. - The target price is maintained at Rmb7, with the stock trading at a P/E ratio of 28x for FY25, indicating a stretched valuation given the limited growth visibility [5][17]. Revenue and Earnings Estimates - Revenue estimates for FY25E and FY26E have been fine-tuned, with projected revenues of Rmb23.1 billion and Rmb24.9 billion respectively [5][12]. - The report anticipates a core net profit of Rmb4.3 billion for FY25E, reflecting a 20.7% growth [6][12].

Investment Rating - The report maintains a "Buy" rating for Shuanghuan Drive, with a target price set at Rmb42.0, indicating an expected share price return of 31.0% [4][7]. Core Insights - Shuanghuan's net profit for 2024 increased by 25% year-on-year to Rmb1.02 billion, aligning with market expectations, while the gross profit margin (GPM) expanded by 2.8 percentage points to 25.0%, surpassing both CitiE and consensus estimates [1][2]. - The growth in GPM is attributed to improvements in NEV gear and a reduced contribution from the low-GPM steel trading business, which saw a revenue decline of 46% year-on-year [1][2]. - The best-performing segments were plastic gear, which grew by 69% year-on-year, and NEV gears, which increased by 51% year-on-year [1][2]. Revenue and GPM by Product - Revenue growth in 2024 was notable in plastic gear (69% YoY) and NEV gear (51% YoY), while reducers and components and power tool gears also saw growth of 18% and 10% YoY, respectively [2]. - The steel trading business experienced the largest revenue decline due to a change in business model and efforts to mitigate bad debt risk [2]. - GPM improvements were observed across various segments, with plastic gear and passenger vehicle gear GPM expanding by 4.8 and 3.9 percentage points YoY, respectively [2]. Earnings Summary - The earnings summary indicates a projected net profit of Rmb1.026 billion for 2024, with a diluted EPS of Rmb1.202, reflecting a growth of 23.9% [3]. - The report forecasts continued earnings growth, with a projected net profit of Rmb1.279 billion for 2025, representing a 24.7% increase [3]. Valuation - Shuanghuan is valued at Rmb42.0 per share, based on a 28x 2025E EPS and a 25% earnings growth estimate for 2025 [20]. - The stock is considered to be trading at an undemanding valuation of approximately 21x 2025E P/E, which is attractive given the expected earnings growth [7].

Investment Rating - The report does not explicitly provide an investment rating for the sectors discussed Core Insights - The report highlights the impact of increased US tariffs on various sectors including appliances, autos, industrial tech, and solar companies, with management expressing concerns over supply chain disruptions and capital allocation strategies China Consumer Durables - Companies derive an average of 35% of revenues from China exports and 7% from exports to the US [5] - Production is shifting to overseas factories, with some companies receiving more orders from US clients as they seek to restock before the tariff reprieve period ends [6] - There is low visibility on price re-negotiation, with companies cautious about raising prices due to market share concerns [6] - Ex-US demand remains stable, particularly in Europe, which is expected to absorb US capacity [6] - CAPEX visibility is low, with Mexico considered a safer investment location due to its free trade agreement with the US [6] China Autos - Companies derive 6%-26% of total revenue from China exports and 0%-10% from exports to the US [7] - Management believes US-China trade tensions have softened recently, with expectations of higher exports to Europe due to ongoing negotiations [7] - Auto suppliers report no order cancellations and are negotiating new prices, with some passing on the full tariff burden to customers [8][10] China Industrial Tech - Companies derive 15%-45% of total revenue from exports and 2%-20% from exports to the US [11] - Orders paused initially in early April but returned to normal by the second week, with some customers continuing their overseas construction plans despite tariff uncertainties [11] - Most companies have signed FOB contracts, meaning customers bear the tariff costs [11] - Companies are maintaining existing capacity expansion plans, with some pausing expansion until tariff policies are clearer [12] China Solar - Companies involved in solar exports have 0%-15% direct exports to the US and 35%-55% to other countries [17][18] - One company has stopped shipping ESS products to the US due to high tariffs, while others are expanding inverter capacity overseas [19] - Softening demand in the US is a key challenge, with concerns over potential price hikes dampening downstream demand [20] - Companies are considering scaling back US exposure if operational risks outweigh profitability compared to other regions [20]

Investment Rating - The report maintains an "Overweight" rating on Tesla with a price target of $410, indicating a positive outlook on the company's potential in the humanoid robotics sector [3]. Core Insights - The global humanoid market is projected to reach 1 billion humanoids and $5 trillion in annual revenue by 2050, significantly surpassing the global auto industry [1][34]. - The report emphasizes that the market for humanoid robots will be materially larger than the global auto industry, with an estimated $4.7 trillion in sales by 2050, nearly double the revenues of the 20 largest global auto OEMs in 2024 [2]. - China is positioned as a dominant player in the humanoid robotics market, with significant investments from legacy auto manufacturers diversifying into humanoid robots [3][7]. Market Projections - By 2036, approximately 23.7 million humanoids are expected to be adopted globally, with significant contributions from various income classifications [22]. - By 2040, this number is projected to increase to around 134.4 million, and by 2050, total adoptions are expected to reach 1 billion [22][24]. - The report outlines that the humanoid market could reach $211 billion by 2035 and $1.2 trillion by 2040, with a 6-year replacement cycle factored into the estimates [34]. Implications for Legacy Manufacturing - The report discusses the decline of legacy manufacturing and the emergence of new entrants in the humanoid robotics space, suggesting a shift in investment strategies among traditional manufacturers [3]. - It highlights that US manufacturers may need to adapt significantly to remain competitive in the humanoid robotics sector, particularly in response to China's advancements [7]. Adoption Estimates - The report provides detailed adoption estimates by income classification, indicating that by 2050, low-income countries will adopt approximately 14 million humanoids, while high-income countries will adopt around 296 million [22][23]. - The cumulative adoption of humanoids is expected to vary significantly across regions, with East Asia and Pacific projected to lead in adoption numbers [24][32]. Performance of Humanoid-Related Stocks - The "Humanoid 100" list includes public companies involved in the humanoid market, which has outperformed the S&P 500 by 10.5 percentage points year-to-date [17]. - Notably, seven of the top ten performers on this list are China-based companies, reflecting strong market sentiment and government support for humanoid robotics [17][20].