Group 1 - The core viewpoint of the article highlights the growth in the production of non-ferrous metals in China, with a reported output of 6.95 million tons in June 2025, reflecting a year-on-year increase of 4.4% [1] - In the first half of 2025, the cumulative production of ten types of non-ferrous metals in China reached 40.319 million tons, showing a cumulative growth of 2.9% [1] - The article references a market dynamics analysis report by Zhiyan Consulting, which covers the non-ferrous metal smelting and rolling processing industry in China from 2025 to 2031 [1] Group 2 - The listed companies in the non-ferrous metal sector include Zijin Mining (601899), Luoyang Molybdenum (603993), China Aluminum (601600), Northern Rare Earth (600111), Jiangxi Copper (600362), Yunnan Copper (000878), Chihong Zinc & Germanium (600497), Zhongjin Gold (600489), Western Mining (601168), and Shenghe Resources (600392) [1] - Zhiyan Consulting is recognized as a leading industry consulting firm in China, specializing in in-depth industry research reports, business plans, feasibility studies, and customized services [2] - The data sources for the article include the National Bureau of Statistics and Zhiyan Consulting [3]

Core Insights - The Zhongzheng All Index Free Cash Flow Index (932365) has shown a strong increase of 1.84%, with notable gains in constituent stocks such as Mona Lisa (002918) up by 10.03% and Yaxiang Integration (603929) up by 10.01% [2] - The Free Cash Flow ETF Fund (159233) has also risen by 1.99%, marking its fourth consecutive increase, with a latest price of 1.13 yuan [2] - Over the past week, the Free Cash Flow ETF Fund has accumulated a rise of 1.19% as of August 22, 2025 [2] Performance Metrics - The Free Cash Flow ETF Fund has a turnover rate of 4.14% during the trading session, with a transaction volume of 3.92 million yuan [2] - The average daily transaction volume over the past year for the Free Cash Flow ETF Fund is 25.03 million yuan [2] - Since its inception, the fund's highest monthly return has been 4.04%, with a maximum consecutive monthly increase of 4.42% [2] Drawdown and Recovery - The maximum drawdown for the Free Cash Flow ETF Fund since inception is 3.28%, with a relative benchmark drawdown of 0.21% [3] - The recovery time after drawdown is 12 days, indicating a relatively quick recovery compared to comparable funds [3] Fee Structure - The management fee for the Free Cash Flow ETF Fund is 0.50%, while the custody fee is 0.10% [3] Tracking Precision - As of August 22, 2025, the tracking error for the Free Cash Flow ETF Fund year-to-date is 0.168% [3] - The fund closely tracks the Zhongzheng All Index Free Cash Flow Index, which selects 100 listed companies with high free cash flow rates to reflect the overall performance of companies with strong cash flow generation capabilities [3] Top Holdings - As of July 31, 2025, the top ten weighted stocks in the Zhongzheng All Index Free Cash Flow Index include China National Offshore Oil Corporation (600938), COSCO Shipping Holdings (601919), and Wuliangye Yibin (000858), collectively accounting for 57.53% of the index [3]

Market Overview - The Shanghai Composite Index rose by 3.49% and the CSI 300 Index increased by 4.18% during the week of August 18-22 [2][3] - The SW Nonferrous Metals Index saw a gain of 1.33%, while COMEX gold and silver prices increased by 1.05% and 2.26%, respectively [2][3] Industrial Metals - Industrial metal prices showed mixed movements: LME aluminum +0.73%, copper +0.50%, zinc +0.32%, lead +0.56%, nickel -1.45%, and tin +0.70% [2][3] - The SMM imported copper concentrate index reported a decrease of $3.47/ton to $-41.15/ton, while the copper rod enterprises' operating rate rose to 71.80%, up by 1.20 percentage points [3] - Domestic electrolytic aluminum social inventory decreased by 11,000 tons, totaling 596,000 tons, indicating a slight increase in production and improved demand expectations [3] - Recommended companies in the industrial metals sector include Zijin Mining, Luoyang Molybdenum, Minmetals Resources, China Nonferrous Mining, and others [3] Energy Metals - Cobalt raw material imports continue to decline, suggesting a potential price surge for cobalt, while lithium supply disruptions remain a concern [4] - Carbonate lithium prices have rebounded due to increased market activity, with expectations for a strong short-term performance [4] - Cobalt prices are expected to strengthen as domestic inventory continues to deplete, with stable price increases for cobalt sulfate [4] - Recommended companies in the energy metals sector include Cangge Mining, Huayou Cobalt, and others [4] Precious Metals - The expectation of interest rate cuts by the Federal Reserve has positively influenced gold prices, with the People's Bank of China continuing to increase gold reserves for nine consecutive months [5] - Silver prices are also rising due to its industrial properties and recovery dynamics [5] - Recommended companies in the precious metals sector include Shandong Gold, Tongguan Gold, and others, with a focus on potential opportunities if gold prices stabilize above $3,500/oz [5]

Group 1 - The core viewpoint is that the National Index of Free Cash Flow has shown strong performance, with a notable increase of 1.4% as of August 25, 2025, and significant gains in constituent stocks such as Yaxiang Integration and Luoyang Molybdenum [3] - The Free Cash Flow ETF (159201) has risen by 1.08%, with a latest price of 1.13 yuan, and has achieved a cumulative increase of 1.73% over the past week, ranking first among comparable funds [3] - The Free Cash Flow ETF has seen a net inflow of 291 million yuan over the past five days, with a total share increase of 20.9 million shares, also leading among comparable funds [3] Group 2 - As of August 22, 2025, the Free Cash Flow ETF has the highest tracking accuracy among comparable funds, with a tracking error of only 0.039% over the past month [4] - The top ten weighted stocks in the National Index of Free Cash Flow as of July 31, 2025, include SAIC Motor, China National Offshore Oil, Midea Group, and Gree Electric, collectively accounting for 57.66% of the index [4] - The latest financing buy-in amount for the Free Cash Flow ETF is 7.36 million yuan, with a financing balance of 42.43 million yuan, indicating ongoing leverage investment [3]

Group 1: Copper Market - The expectation of a Federal Reserve rate cut in September has increased, which is likely to support copper prices [1][2] - This week, the price changes for copper were -0.05% for LME copper, -0.47% for SHFE copper, and -0.62% for COMEX copper, indicating a period of fluctuation [2] - Domestic copper inventory has increased, with LME copper at 156,000 tons, COMEX copper at 271,000 short tons, and SHFE copper at 82,000 tons, showing a month-on-month change of +0.11%, +1.60%, and -5.4% respectively [2] - The downstream demand for copper has rebounded, with the copper rod operating rate at 71.8%, up by 1.19 percentage points [2] Group 2: Aluminum Market - The aluminum market is expected to maintain a fluctuating trend due to rising inventory levels [3] - The price of alumina has decreased by 0.15% to 3,225 CNY/ton, while the main futures contract for alumina fell by 0.41% to 3,192 CNY/ton [3] - The operating capacity for metallurgical-grade alumina reached 91.57 million tons per year, with a weekly operating rate down by 0.2 percentage points to 83.0% due to routine maintenance [3] - Domestic electrolytic aluminum prices fell by 0.34% to 20,700 CNY/ton, with a profit margin of 4,405 CNY/ton, up by 1.84% [3] Group 3: Lithium Market - Lithium salt prices are expected to rise due to seasonal demand, with carbonate lithium prices increasing by 1.45% to 84,000 CNY/ton [4][5] - The production of carbonate lithium this week was 19,000 tons, a decrease of 4.2% month-on-month [5] - SMM weekly inventory for carbonate lithium is at 142,000 tons, down by 0.5% [5] Group 4: Cobalt Market - The import volume of cobalt raw materials has continued to decline, which may accelerate the digestion of raw material inventory, leading to potential price increases [5] - Domestic cobalt prices fell by 0.38% to 261,000 CNY/ton [5] - The extension of the cobalt export ban by the Democratic Republic of Congo is expected to accelerate the reduction of cobalt raw material inventory, potentially leading to a tight supply situation in Q4 [5]

Core Insights - The A-share market has seen a surge in mergers and acquisitions (M&A) activities since August, with 96 companies disclosing M&A announcements from August 1 to August 24, indicating that M&A is a crucial method for optimizing resource allocation and enhancing company efficiency [1] Group 1: M&A Activities - Several companies are involved in resolving industry competition through M&A, such as Chongqing Waterworks planning to acquire 100% of Chongqing Yujing Waterworks for 354 million yuan to address potential competition with its parent company [2] - Yunnan Copper intends to acquire an additional 40% stake in Liangshan Mining, which will make it a subsidiary, enhancing resource reserves and production capacity [2] - China Shenhua is set to acquire assets from its parent company, covering 13 firms across coal, coal chemical, and logistics sectors, aiming for a strategic resource integration and improved emergency response capabilities [3] Group 2: Supportive Policies - Continuous supportive policies for M&A activities have been introduced, including guidelines from the People's Bank of China to enhance M&A loan policies and support investments in industrial chains [4] - Local governments, such as the Chongqing Municipal Government, are also promoting M&A through financial support and optimizing loan services for quality enterprises in technology and green industries [4] - Hainan Province has introduced measures to support the biopharmaceutical industry, offering 50% interest subsidies on bank loans for companies involved in M&A within the sector [5] - Henan Province has announced policies to broaden financing channels for companies, encouraging M&A and refinancing as tools for growth [6] - Since the introduction of the "Six M&A Guidelines," the market has remained active, with Jiangsu Province reporting 209 new M&A disclosures and a total transaction amount exceeding 650.84 billion yuan [6]

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Greater China Materials - **Current View**: Attractive outlook for the materials sector in Asia Pacific, particularly in rare earth and magnet segments due to regulatory changes [4][6] Regulatory Changes - **New Regulations**: The Ministry of Industry and Information Technology (MIIT), National Development and Reform Commission (NDRC), and Ministry of Natural Resources have released stricter regulations for rare earth production [6] - **Key Changes**: - Enhanced control over rare earth mining, smelting, and separation through more rigorous production reporting systems [6] - Removal of public disclosure requirements for rare earth quotas, indicating tighter supply management [6] - Monthly production data reporting mandated for all rare earth companies, enhancing oversight [6] - Minor violations will now face penalties under public order laws, indicating a stricter enforcement environment [6] Market Implications - **Supply Tightening**: The new regulations are expected to tighten the supply of rare earth materials, which may positively influence investor sentiment in the short term [6] - **Potential for Further Regulation**: The changes suggest possible future regulations on rare earth production outside of China, particularly in Southeast Asia, although specifics remain unclear [6] Company Ratings and Performance - **Highlighted Companies**: - Aluminum Corp. of China Ltd. (601600.SS) rated Overweight with a price of Rmb7.72 [56] - Ganfeng Lithium Co. Ltd. (002460.SZ) rated Underweight with a price of Rmb38.30 [58] - Zijin Mining Group (601899.SS) rated Overweight with a price of Rmb20.66 [58] - **Stock Ratings Distribution**: - Overweight: 40% of total coverage - Equal-weight: 43% - Underweight: 16% [24] Analyst Insights - **Analyst Certification**: Rachel L Zhang certifies that her views on the companies discussed are accurately expressed and free from conflicts of interest [11] - **Investment Banking Relationships**: Morgan Stanley has received compensation from several companies in the materials sector, indicating potential conflicts of interest [13][15] Conclusion - The regulatory changes in the rare earth sector are significant and may lead to tighter supply dynamics, positively impacting investor sentiment. The overall outlook for the Greater China materials sector remains attractive, with specific companies showing varied ratings based on their market positions and regulatory compliance.

Investment Rating - The report maintains a positive outlook on the metals and new materials industry, emphasizing cyclical investment opportunities [1]. Core Insights - The report highlights the dovish stance of Federal Reserve Chairman Powell, suggesting potential interest rate cuts that could benefit the metals sector [4]. - The report indicates a strong performance of the metals sector, with significant year-to-date increases in various metal prices, particularly small metals and energy metals [9]. - The report recommends focusing on companies with stable supply-demand dynamics in the new energy manufacturing sector, such as Huafeng Aluminum and Asia-Pacific Technology [4]. Weekly Market Review - The Shanghai Composite Index rose by 3.49%, while the Shenzhen Component Index increased by 4.57% [5]. - The non-ferrous metals index increased by 1.33%, underperforming the CSI 300 Index by 2.85 percentage points [5]. - Year-to-date, the non-ferrous metals index has risen by 38.60%, outperforming the CSI 300 Index by 27.34 percentage points [8]. Price Changes and Key Company Valuations - Industrial metals prices showed mixed results, with copper prices slightly decreasing by 0.24% and aluminum prices increasing by 0.67% [14]. - The report provides detailed price changes for various metals, indicating a general upward trend in precious metals like gold and silver [14]. - Key companies in the industry, such as Zijin Mining and Shandong Gold, are highlighted for their potential based on current valuations and market conditions [18]. Supply and Demand Analysis - The report notes that copper demand remains strong, with operating rates for electrolytic copper rods and wire and cable showing slight increases [33]. - Aluminum production is stable, with a reported operating rate of approximately 97.8% for electrolytic aluminum [50]. - The steel sector is experiencing a slight increase in production, but demand remains weak during the off-season [77].

证券研究报告 | 行业定期报告 2025 年 08 月 24 日 总量管控政策落地助力稀土 看好钴锑钨 金属行业周报 周期/金属及材料 下周关注美 PCE 和国内外 PMI 数据。美联储政策不确定扰动近期市场节奏。 全球流动性宽松大周期，近期为金属价格提供底部支持，远期提供上涨动力和 空间。稀土总量管控政策落地，加上稀土战略金属地位提升，我们继续看好稀 土价格和稀土板块估值提升。近期重点关注，稀土和钨依然在主升浪，钴锑有 望再迎上涨。此外，关注自主可控相关以及时间友好的科技、机器人、可控核 聚变等相关材料标的。 推荐（维持） 行业规模 | | | 占比% | | --- | --- | --- | | 股票家数（只） | 235 | 4.6 | | 总市值（十亿元） | 5040.8 | 5.0 | | 流通市值（十亿元） | 4680.7 | 5.1 | 敬请阅读末页的重要说明 ❑ 有色金属（801050）申万一级行业指数本周涨幅 1.33%，排名第 26。本周 申万二级行业指数，能源金属（1.48%），工业金属（-1.16%），小金属 （10.53%），贵金属（-0.43%）。 ❑ 本周最大涨幅个股：宜安 ...

Investment Rating - The investment rating for the non-ferrous metals industry is "Positive" (maintained) [4][108]. Core Views - The report highlights that the expectation of a rate cut by the Federal Reserve in September is likely to support copper prices, with a potential upward trend anticipated due to increased demand during the peak season [3][5]. - The report emphasizes the importance of monitoring the Federal Reserve's actions in September and the demand support during the "golden September and silver October" period [5]. Summary by Sections 1. Industry Overview - The report notes that the U.S. initial jobless claims for the week ending August 16 were higher than expected, indicating economic uncertainty [9]. - Fed Chairman Powell's dovish remarks suggest a stronger likelihood of a rate cut in September, which could positively impact the non-ferrous metals market [9]. 2. Industrial Metals Copper - Copper prices showed slight declines this week, with LME copper down 0.05%, SHFE copper down 0.47%, and COMEX copper down 0.62% [25]. - Domestic copper inventories increased, with LME copper stocks at 155,975 tons (+0.11%) and SHFE copper stocks at 81,698 tons (-5.40%) [22][25]. - The report suggests that copper prices may rise due to improved downstream demand and the upcoming peak season [5]. Aluminum - Aluminum prices are expected to remain stable, with SHFE aluminum down 0.34% to 20,670 yuan/ton and LME aluminum down 0.58% [36]. - The report indicates that aluminum inventories are rising, with domestic spot inventories at 595,000 tons (+0.85%) [36]. Lithium - Lithium carbonate prices increased by 1.45% to 83,900 yuan/ton, while lithium spodumene prices decreased by 0.64% to 934 USD/ton [78]. - The report anticipates a reduction in lithium inventories due to seasonal demand, which may drive prices higher [78]. Cobalt - Domestic cobalt prices fell by 0.38% to 261,000 yuan/ton, with a significant drop in imports from the Democratic Republic of Congo [89]. - The report suggests that the extended export ban from Congo may lead to a tightening of cobalt supplies in Q4, potentially increasing prices [89]. 3. Market Performance - The non-ferrous metals sector underperformed compared to the Shanghai Composite Index, with a weekly increase of 1.33% versus the index's 3.49% [11][12]. - The report identifies the top-performing stocks in the sector and notes the overall market sentiment [11]. 4. Valuation Changes - The PE_TTM for the non-ferrous metals sector is reported at 22.80, with a slight increase of 0.27 [20]. - The PB_LF for the sector stands at 2.63, reflecting a change of 0.03 [20].