Global Research ab 22 May 2025 First Read China Banks Marketing feedback - Investors wonder if it's time to take some profit Investors value dividend yields but recognise the soft fundamental During our Singapore, Kuala Lumpur and Hong Kong marketing in the past two weeks, we met with over 50 institutions, of which the majority (c70%) were long-only funds. Private bank investors and hedge funds made up for the rest. In general, despite some positioning increase in selected sectors (e.g., AI), LOs remain und ...

May 20, 2025 10:00 PM GMT China Autos & Shared Mobility: Investor Presentation | Asia Pacific Japan Summit – AI-Enabled Mobility & Humanoid Robotics | M | | | | --- | --- | --- | | | | Update | | May 20, 2025 10:00 PM GMT | | | | China Autos & Shared Mobility: Investor | Morgan Stanley Asia Limited+ | | | Presentation Asia Pacific | Tim Hsiao | | | | Equity Analyst | | | | Tim.Hsiao@morganstanley.com | +852 2848-1982 | | Japan Summit – AI-Enabled | Stanley Wang Research Associate | | | | Stanley.Wang@morgan ...

23 May 2025 | 4:38PM CST China Multi-Industry Tariff Impact - Feedback from Appliances, Autos, Industrial Tech & Solar Companies (week of May 23) We have conducted discussions with select companies in the appliances, autos, industrial tech and solar sectors to understand the latest management thoughts on the business outlook following the increase in US tariffs. Details inside. China Consumer Durables We have interviewed selected covered companies within the white goods, consumer electronics and furniture s ...

Investment Rating - The report upgrades LYC.AX from Underweight (UW) to Overweight (OW) and ILU from Equal Weight (EW) to Overweight (OW) [5] Core Insights - The humanoid market is projected to reach 0.9 million units and $0.02 trillion by 2030, 134 million units and $1.2 trillion by 2040, and 1,019 million units and $4.7 trillion by 2050, with each humanoid requiring significant amounts of critical minerals [4][11][40] - Cumulative incremental demand for critical minerals could reach up to $800 billion by 2050, with humanoids potentially adding 40% to 167% to the demand for rare earths (specifically NdPr) by 2040 to 2050 [4][16][63] - The report highlights that Chinese enterprises control a significant portion of the supply for critical minerals, necessitating supply chain diversification for western producers [4][21][66] Summary by Sections Humanoid Market Projections - Humanoids could create a market of 0.9 million units and $0.02 trillion by 2030, 134 million units and $1.2 trillion by 2040, and 1,019 million units and $4.7 trillion by 2050 [4][11][40] - Each humanoid is estimated to require approximately 0.9 kg of NdPr, 2 kg of lithium, 6.5 kg of copper, 1.4 kg of nickel, 180 g of cobalt, and 3 kg of graphite [4][11][40] Demand for Critical Minerals - Incremental demand from humanoids could add up to $800 billion across covered critical minerals by 2050, with significant increases in demand for NdPr, lithium, cobalt, and nickel [4][16][63] - By 2050, the annual added demand for critical minerals could be between $50 billion and $120 billion [4][16][63] Supply Chain Dynamics - Chinese enterprises currently control 65% of rare earths, 27% of lithium, approximately 70% of nickel, 55% of cobalt, and 82% of graphite, highlighting the need for diversification in supply chains [4][21][66] - The average lead time for new mines has increased to approximately 17.8 years, posing challenges for meeting rising demand for critical minerals [4][22][66] Price Forecasts and Market Opportunities - The report upgrades long-term price forecasts for rare earths, specifically increasing the NdPr price from $135 per ton to $209 per ton [30][66] - A list of 34 companies is provided for investors to capitalize on the thematic of incremental humanoid demand for critical minerals [5][30]

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].

Investment Rating - The report rates both Weichai Power's A- and H-shares as Buy [16]. Core Insights - Weichai Power is on track with sales of large-bore engines, maintaining its full-year target and showing positive development in blended average selling price (ASP) [1]. - The company anticipates that the impact of the replacement policy will become more visible by June, as local government implementations vary [1][10]. - Weichai is committed to developing a strong new energy powertrain business and may consider acquisitions to support this growth [1][15]. - Shareholder return enhancement is a focus, with plans for increased cash dividends and share buybacks [1][15]. Sales and Market Performance - Sales volume for large-bore engines reached 2,400 units in Q1, with April achieving 800 units, reflecting a 50% year-over-year increase [10]. - The domestic market's contribution to sales has risen to 40%, up from 30% in 2024 [10]. - The blended ASP for large-bore engines increased to RMB 450,000 from RMB 430,000 in 2024 [10]. - The full-year sales volume target is set at 120,000 units, with expectations for data-center application engines to stabilize at 2,500 to 2,600 units over the next two years [10]. Strategic Focus and Future Outlook - Weichai's long-term strategy includes focusing on new energy powertrains, off-highway machinery engines, overseas expansion, and aftermarket services [15]. - The company is exploring acquisition targets in new energy powertrains and humanoid robots [15]. - Management expects total industry sales of 950,000 units, with potential upward revisions depending on the implementation of the replacement policy [10]. Financial Projections - Revenue for 2024 is projected to be RMB 1.5 billion, with expectations to increase to RMB 4-5 billion in the current year [11]. - The expected net profit for the current year is RMB 100 million [11]. - The company anticipates a robust free cash flow profile, yielding approximately 10-20% from 2025 to 2027 [14].

22 May 2025 | 9:32PM HKT Kingsoft Office (688111.SS): TechNet China 2025: WPS 365 covering AI, collaboration and office software, positive in enlarging user base; 2. Ramp up of ToB WPS 365 platform: The WPS 365 for enterprise users delivered strong growth at 63% YoY to Rmb151mn in 1Q25, supported by growing adoption of SOE and enterprises. Management highlights the capabilities of WPS 365 across Office software, collaboration, and AI based on company's own knowledge base, offering one-stop solution for ente ...

21 May 2025 | 2:40PM HKT VeriSilicon (688521.SS): TechNet China 2025: Chairman visit; Chiplet/ IP for AI inferencing and AI devices to drive growth ahead; Buy We hosted VeriSilicon's Chairman on May 21 at our TechNet Conference China 2025. Key discussions were around orders momentum, Chiplet and GPU/ AI IP projects, and client demand. Overall, management is positive on rising AI inferencing demand and growing adoption of AI devices (AI smartphones, AI PC, AI glasses, autonomous driving, etc.) with LLM (Larg ...

May 21, 2025 10:00 AM GMT China Gold Jewelry | Asia Pacific Milder gold rise supports demand recovery We see weight-based gold products gradually recovering, which is supportive to overall jewelry stocks. Stock performance will remain divergent given different product/channel cycles, self- help strategies and execution. Key Takeaways Milder gold price hike is positive for gold jewelry demand, especially for weight- based gold jewelry products, which is >70% of the gold jewelry market. We expect some pent-up ...

May 19, 2025 12:39 PM GMT Tesla Inc | North America Autonomy & Alchemy: Valuing Tesla in the Robot Era Nearly 15 years after going public, investors struggle to justify the value of Tesla as much as ever before. We expect this valuation 'problem' gets worse before it gets better. It's not too late to change. "If one knows what is really happening one knows what is going to happen." • H.G. Wells (The Shape of Things to Come) Vita post auto. Most investors value Tesla's core auto business at between $50 and $ ...