Investment Rating - The report assigns a Neutral rating to China Pacific Insurance (CPIC) with a 12-month price target of HK$23.50 for H-shares and Rmb26.50 for A-shares, indicating a downside of 6.0% and 24.0% respectively [9][13]. Core Insights - Strong sales momentum has been observed in the first quarter of FY25, continuing into the second quarter, with the mix of participating product sales increasing to over 30% by the end of May, compared to approximately 20% in 1Q25 [5]. - CPIC's agency headcount has stabilized year-to-date, with plans to increase recruitment starting in the second half of FY24, focusing on improving agent productivity [5]. - The bancassurance channel has shown strong growth in value of new business (VONB) for FY24, with expectations of similar momentum in FY25, particularly in tier 1-2 cities [5]. - Investment in equity and funds remains stable at around 12% of total investment assets, with a new money yield of approximately 2.5% [12]. Sales Momentum - The sales momentum in 1Q25 has continued into 2Q25, with a notable increase in the sales mix of participating products [5]. - The agency channel aims to promote health and protection products to improve margins and diversify the product mix [5]. - The bancassurance channel strategy focuses on tier 1-2 cities to access mid-to-high-end customers, maintaining key partnerships with banks [5]. Asset and Liability Management - CPIC's current effective duration gap is 3-4 years, with an asset duration of 11.6 years [12]. - The blended guaranteed cost of liability is around 2.8%, expected to be lower than 2.5% when including positive expense and risk margins [12]. Shareholders' Return - CPIC will maintain its annual payout policy and has not proposed a detailed plan for share buybacks, despite receiving authorization from the AGM [12]. - The company emphasizes total payout ratio over more frequent dividend payments, indicating a focus on long-term shareholder returns [12].

Investment Rating - The report assigns a "Sell" rating to New China Life Insurance (NCI) with a 12-month price target of HK$20.50 and Rmb28.50, indicating a downside potential of approximately 47.6% and 49.3% respectively [7][9]. Core Insights - Recent sales momentum has shifted towards participating products, which accounted for over half of new premiums in the agency channel during April and May. The company aims for a 30% participating product mix by FY25 [5][6]. - NCI's investment strategy includes maintaining a stable equity allocation of approximately 16% as of FY24, with plans to increase high dividend investments in FY25. The company is also focusing on long-duration bonds to enhance investment income [6][8]. Sales Momentum and NBV Outlook - Participating product sales have increased since April, moving away from traditional products. The company expects a gradual shift towards participating products over the next 2-3 years [5]. - NCI aims to achieve above-industry NBV growth in FY25, despite the lower margin nature of participating products compared to traditional ones [5][6]. Investment Allocation - NCI's new investments are projected to be around Rmb200-300 billion per year, with a new money yield of 2-3% for fixed income investments. The asset allocation strategy is primarily focused on fixed income (70-80%) and equity (20%) [8]. - The current cost of liability is above 3%, but NCI anticipates a decrease as new policies guarantee lower costs in 2024 and 2025 [8].

15 June 2025 | 1:53PM HKT Potential opportunities on other technology platforms: Referring to technology platform-based collaborations between China pharma / biotech and MNCs (see summary in Exhibit 1), the upfront payment of US$110mn for the announced AZ/CSPC collaboration is consistent with the historical range of US$10mn to below US$200mn, while the total deal size of US$5.3bn was the highest since 2023. With the current collaboration announced to date, we see growing recognition from MNCs for CSPC's tec ...

Investment Rating - The report assigns a "Buy" rating for Laopu Gold (6181.HK) with a target price raised to HKD 1,090, indicating an upside potential of 23.7% from the current price of HKD 881.50 [1]. Core Insights - Laopu Gold's earnings are expected to grow by 15-26% in 2025-27E, driven by strong year-to-date sales performance and rapid store expansion, supported by increasing brand awareness and a rising gold price forecast [1][2]. - The company has successfully launched a new product series, "七子葫芦" (Seven-color enamel gold gourd), which has received positive feedback and is expected to enhance brand equity while allowing for higher pricing [2]. - The upcoming quarter is anticipated to be eventful with several strategic initiatives planned, including new product launches and store optimizations, aimed at reinforcing Laopu's market position against traditional jewelers [2][16]. Financial Performance - Revenue projections for Laopu Gold have been significantly revised upwards, with estimates for 2025 increasing from RMB 19,585 million to RMB 26,310 million, reflecting a robust growth trajectory [4]. - The company's online sales have shown remarkable growth, with a total GMV of RMB 1.6 billion from January to May, representing a 511% year-on-year increase [1][22]. - The EBITDA and EPS forecasts have also been adjusted upwards, with 2025 EPS now estimated at RMB 27.60, up from RMB 22.13 [4]. Market Position and Competitive Advantage - Laopu Gold has demonstrated strong same-store sales growth (SSSG) above triple-digit percentages, outperforming both local and international competitors in the jewelry sector [25][26]. - The company is expanding its total store pipeline beyond the initially guided 6-8 new stores, indicating a proactive approach to market expansion [1][2]. - The successful performance of new product launches and the strategic focus on brand differentiation are expected to sustain growth and expand the total addressable market (TAM) [2][25].

Investment Rating - The investment rating for Laopu Gold is "Buy" with a target price of HK$1,084.0, raised from HK$979.0, indicating an expected return of 14.3% and a total return of 16.6% [7][26]. Core Insights - Laopu Gold has successfully narrowed its product price premium over mass-market gold jewelry, making its high-end products more appealing. The company is expected to sustain triple-digit same-store sales growth (SSSG) into the second half of 2025 if gold prices remain high [1][2]. - The company has reinvented the gold jewelry business model by using fixed pricing per item rather than weight-based pricing, which has led to a significant reduction in its price premium from approximately 20% to around 5% since mid-April 2025 [2][3]. - Laopu Gold is changing consumer perceptions of gold jewelry from a commodity to a storytelling artwork, enhancing its competitive landscape and allowing brands to focus on product development rather than price competition [3][4]. - The brand's premium image, characterized by customer experience and unique craftsmanship, is not easily replicable, reducing concerns about competition from copycat products [4][5]. Financial Summary - The net profit for Laopu Gold is projected to grow significantly, with estimates of Rmb 4,727 million for 2025, Rmb 6,459 million for 2026, and Rmb 8,016 million for 2027, reflecting a growth rate of 220.9% in 2025 [6][19]. - The company expects to increase its prices by 9-10% in the second half of 2025, which could widen its price premium to 10-15% if gold prices remain stable [2][5]. - Laopu Gold's revenue is projected to reach Rmb 23,656 million in 2025, with a year-on-year growth rate of 178.1% [18][19]. Market Position - Laopu Gold is ranked as the number one gold jewelry brand in China in terms of single-store sales for 2022 and 2023, with a market share of 31% in the gold jewelry segment as of 2023 [25][26]. - The company has a unique niche in "heritage gold," combining modern designs with traditional Chinese craftsmanship, which has contributed to its strong market position [25][26]. Valuation - The target price of HK$1,084 is based on a price-to-earnings (P/E) ratio of 36x for 2025E, reflecting a premium valuation compared to global luxury peers due to its rapid growth outlook and strong product competitiveness [27].

Investment Rating - The report assigns a "Buy" rating to Hengrui Medicine with a 12-month price target of Rmb55.90, indicating an upside potential of 3.7% from the current price of Rmb53.89 [13][15]. Core Insights - Hengrui Medicine is positioned as a second-tier player in the GLP-1 space, with a comprehensive product offering that includes both oral and injectable formulations, as well as single and dual agonists. The company is expected to launch its innovative drug HRS9531 in 2026 after filing for NDA by the end of 2025 [3][13]. - The oral peptide HRS9531 has shown promising preliminary efficacy, with a placebo-adjusted mean weight loss of -3.5% at Day 29, comparable to orforglipron's -3%. However, it is less effective than Hengrui's injectable HRS-7535, which achieved -5.5% weight loss at week 4 [2][3]. - The injectable form of HRS9531 demonstrated durable weight loss, achieving a placebo-adjusted weight loss of -16.7% at week 24 and maintaining weight stability from week 32 to week 52, with changes ranging from -0.76% to 0.01% [3]. Summary by Sections Product Efficacy - The oral form of HRS9531 showed comparable efficacy to orforglipron, with a weight loss of -3.5% at Day 29, while the injectable form achieved a weight loss of -9.3% at week 4 [2][7]. - The injectable HRS9531 has completed patient enrollment for phase 3 clinical trials and is expected to file for NDA by the end of 2025 [3]. Market Position - Hengrui's competitive advantage lies in its diverse product portfolio and commercial capabilities in metabolic diseases, which could create synergies in the market [3][13]. - The company is projected to see revenue growth, with estimates of Rmb30.37 billion in 2025 and Rmb37.09 billion in 2027 [15].

Investment Rating - The investment rating for Haidilao International Holding Ltd is Overweight, with a price target of HK$20.00, indicating a potential upside of 28% from the current price of HK$15.58 [4]. Core Insights - The report highlights that Haidilao is on track to meet its 2025 target for gross store openings, with an expected acceleration in the second half of 2025. The company aims for a gross opening of more than a mid-single-digit percentage of its existing network [6]. - The gross profit margin (GPM) for 2025 is projected to be lower than in 2024 due to rising raw material costs and enhanced customer services, although lower depreciation expenses may provide some mitigation [6][2]. - The report notes that the staff cost ratio is expected to remain stable year-on-year in 2025, while marketing efforts are being expanded to include regional and store-level initiatives [2]. Financial Metrics - For the fiscal year ending December 2025, the estimated net revenue is projected to be RMB 45,930 million, with an EBITDA of RMB 9,002 million and a net income of RMB 5,338 million [4]. - The earnings per share (EPS) for 2025 is estimated at RMB 0.99, with a projected compound annual growth rate (CAGR) of 14% for EPS from 2025 to 2027 [7]. - The report indicates a price-to-earnings (P/E) ratio of 14.5 for 2025, which is considered reasonable given the macroeconomic uncertainties [7]. Market Context - The report mentions that the overall consumption sentiment remains weak, impacting top-line growth, with a year-on-year decline in table turn for Haidilao observed in May 2025 [6]. - The company is also adjusting its store opening strategy for YEAH Qing BBQ, scaling back slightly to ensure quality openings, targeting 100 gross store openings in 2025 [6].

Investment Rating - The investment rating for Sunny Optical is maintained at Neutral with a target price of HK$83.1, representing an upside potential of 24.4% from the current price of HK$66.80 [13][12][8] Core Insights - The report highlights a muted month-over-month growth in May shipments across various product lines, with handset lens shipments down 5% month-over-month and year-over-year to 98 million units [1][7] - Camera module shipments decreased by 17% year-over-year and 4% month-over-month to 38 million units, attributed to a strategic shift towards mid/high-end projects [1][8] - Vehicle lens shipments showed a year-over-year increase of 28% but a month-over-month decline of 7%, totaling 11 million units in May, driven by growing client demand [1][7] Shipment Summary - Handset lens shipments for the first five months of 2025 (5M25) totaled 498 million units, reflecting a 5% year-over-year decline, tracking 81% of previous first-half estimates [7][8] - Vehicle lens shipments in 5M25 reached 54 million units, marking an 18% year-over-year increase, consistent with 86% of prior estimates [7][8] - Camera module shipments in 5M25 were 186 million units, down 25% year-over-year, tracking 81% of previous estimates, which is lower than the 86% tracked in the same period last year [8][7] Financial Projections - Revenue projections for Sunny Optical indicate a gradual increase from RMB 38.3 billion in 2024 to RMB 56.5 billion by 2027, with net income expected to rise from RMB 2.7 billion in 2024 to RMB 4.8 billion in 2027 [9][13] - The report anticipates a target P/E multiple of 21.0x for 2026, aligning with the company's historical trading range [12][8] Market Context - The report notes competitive pressures in the handset lens market and varying shipment growth expectations for camera modules, which could impact market share and operational efficiency [12][8]

Investment Rating - The investment rating for Laopu Gold is Equal-weight [5][6]. Core Insights - Recent demand in the second quarter to date remains healthy for both promotional and normal seasons, despite a recent decline and stabilization in gold prices [8]. - The company plans to open a new store in Singapore in late June 2025, expecting it to be one of the top-performing stores within its network [3]. - Laopu Gold aims to increase the mix of antique products, which currently account for 20% of total sales, with an average selling price (ASP) of over Rmb100,000 compared to approximately Rmb30,000 for regular jewelry [2][8]. Summary by Sections New Product Launches - Multi-color enamel Hulu necklaces launched on May 30 are well received among core customers, enhancing brand recognition [2]. Store Expansion Plans - There could be one or two additional store openings in 2025, with a target total of eight stores [8]. - New store locations include IFC and Xintiandi in Shanghai, MixC in Shenzhen Bay, IFC in Hong Kong, and Marina Bay Sands in Singapore [8]. Pricing Strategy - A price hike is anticipated after the 618 festival, with the exact timing still uncertain, but a potential increase in September 2024 is noted [2][8]. Financial Projections - The price target is set at HK$865.00, with a projected P/E ratio of 33x for 2025, indicating a PEG of 1.4, aligning with the overall Chinese consumer average [10].

Investment Rating - The report maintains an "Overweight" rating for Kingsoft Cloud with a target price of $18.50 for KC US and HKD 10.00 for 3896 HK [1][2][16] Core Insights - Kingsoft Cloud's stock price has increased by 140% since the release of its Q3 2024 results, outperforming the Chinese internet index fund which rose by 8% during the same period [1][12] - The company's strategic shift towards artificial intelligence and its integration within the Xiaomi and Kingsoft Group ecosystems are yielding positive financial results [1][12] - The growth prospects for Kingsoft Cloud's AI revenue are considered more certain compared to many other AI stocks due to its unique relationships and increasing demand for GPU computing power [1][12] - The introduction of third-party computing providers is expected to negatively impact Kingsoft Cloud's profit margins due to the complexities in supply chain management [1][12] Summary by Sections Investment Thesis - Kingsoft Cloud's AI revenue has shown significant growth, with total AI revenue rising from RMB 360 million in Q3 2024 to RMB 474 million in Q4 2024 (approximately 500% year-on-year) and RMB 530 million in Q1 2025 (228% year-on-year) [3][12] - The company has achieved three consecutive quarters of triple-digit year-on-year growth in AI revenue, which has improved overall profitability, with adjusted EBITDA margins increasing from 2% in Q1 2024 to 16% in Q1 2025 [3][12] Financial Projections - Revenue forecasts for 2025 have been raised to RMB 9,355 million, reflecting a 17% increase from previous estimates [4][16] - Adjusted net loss for 2025 is projected to be RMB 874 million, revised from RMB 602 million due to the new computing procurement model [4][12] - The target price is based on a 4x EV/Sales multiple for 2025, positioned between the average multiples of U.S. single-business cloud service providers (5.9x) and small-cap SaaS stocks (3.8x) [8][12] Valuation - The target price for Kingsoft Cloud is set at $18.50 based on a 4x EV/Sales multiple for 2025, reflecting a positive adjustment in valuation due to the company's narrative shift [1][8][12] - The report indicates that Kingsoft Cloud's valuation should be adjusted upwards due to the positive changes in the company's narrative and financial performance [1][12]