Group 1 - The "drone swarm + robotic dog" collaborative system has been showcased, with Kesi Technology's control chip achieving millisecond-level response for hundreds of devices, and the procurement budget for a single system exceeding 50 million yuan [1] - As of August 4, 2025, the CSI Defense Index (399973) rose by 0.56%, with notable increases in constituent stocks such as Haige Communication (002465) up 3.11% and AVIC Aircraft (600038) up 2.29% [1] Group 2 - The current "14th Five-Year Plan" is nearing its conclusion, and the upcoming September 3 military parade is expected to catalyze a significant reshaping of the military industry sector, which has shown a strong upward trend recently [2] - The military industry is anticipated to enter a new phase of growth and value, moving away from previous cyclical fluctuations driven solely by events, supported by the strategic goal of building a world-class military by 2050 [2] Group 3 - The Defense ETF closely tracks the CSI Defense Index, which includes listed companies under the ten major military groups and those providing weaponry to the armed forces, reflecting the overall performance of defense industry stocks [3] - As of July 31, 2025, the top ten weighted stocks in the CSI Defense Index accounted for 43.88% of the index, with companies like AVIC Shenyang Aircraft (600760) and AVIC Engine (600893) among the leaders [3]

Group 1 - On August 1, among the 31 first-level industries tracked by Shenwan, 11 industries experienced net financing inflows, with the pharmaceutical and biotechnology sector leading at a net inflow of 477 million yuan [1] - Other industries with significant net financing inflows included media, defense and military industry, petroleum and petrochemicals, food and beverage, and real estate, with net inflows of 389 million yuan, 348 million yuan, 204 million yuan, 141 million yuan, and 109 million yuan respectively [1] Group 2 - A total of 1,591 individual stocks received net financing inflows on August 1, with 119 stocks having net inflows exceeding 30 million yuan [1] - Among these, 14 stocks had net financing inflows exceeding 100 million yuan, with Kweichow Moutai leading at 286 million yuan [1] - Other notable stocks with high net inflows included Yidian Tianxia, Yingweike, Ruikeda, Feilihua, Tianfu Communication, Jianghuai Automobile, Zhaoyi Innovation, and China National Petroleum Capital, with net inflows of 278 million yuan, 263 million yuan, 243 million yuan, 179 million yuan, 173 million yuan, 172 million yuan, 163 million yuan, and 160 million yuan respectively [1]

Core Insights - The report highlights the strong performance of 京沪高铁 (Beijing-Shanghai High-Speed Railway) with a total revenue of 42.157 billion yuan in 2024, representing a year-on-year growth of 3.62%, and a net profit of 12.768 billion yuan, up 10.59% year-on-year, indicating resilience during the post-pandemic recovery phase [3][14][15] - The report emphasizes the emergence of国产算力 (domestic computing power) as a significant driver in the AI industry, with华为 (Huawei) showcasing its昇腾 384超节点 (Ascend 384 super node) at the WAIC 2025, which is the largest in the industry and demonstrates a shift from chip-centric to system-level optimization [6][8][10] Group 1: Communication Industry - The report discusses the role of major telecom operators like中国移动 (China Mobile), 中国电信 (China Telecom), and 中国联通 (China Unicom) in the AI landscape, showcasing their transformation into AI infrastructure providers and industry enablers, which injects strong momentum into the digital transformation of the economy [10][11] - The operators are investing heavily in computing infrastructure, with China Mobile planning to invest 37.3 billion yuan in computing power, while both China Telecom and China Unicom are increasing their investments by over 20% year-on-year [13] Group 2: Transportation Industry - The京沪高铁 is recognized as a landmark project in China's high-speed rail network, having transported over 1.6 billion passengers since its opening, with a business model that relies on entrusted transportation management [15][16] - The report notes that the high-speed rail industry is expected to see over 3.2 billion passengers in 2024, with the increasing preference for high-speed rail as a travel option among the public [15][16] Group 3: Key Factors Influencing Growth - For the京沪高铁, factors such as a market-oriented pricing mechanism, strong economic support from the surrounding provinces, and advancements in train technology are identified as critical to sustaining growth [16] - In the domestic computing power sector, the increasing demand for controllable AI infrastructure due to high-end chip shortages and export restrictions is driving the growth of国产算力, with significant investments from major tech companies like阿里巴巴 (Alibaba) and腾讯 (Tencent) [8][10]

Core Viewpoint - The article discusses the current landscape and future strategies of China's display materials industry, emphasizing the dual mainstream technologies of LCD and OLED, the rise of new technologies like quantum dots and Micro-LED, and the critical need for domestic production of high-end materials to overcome reliance on imports [2][5][8]. Group 1: Display Technology Overview - The main display technologies currently dominating the market are TFT-LCD and OLED, with TFT-LCD holding a 40% market share globally due to its low cost and high resolution [7][12]. - OLED is preferred for small to medium-sized high-end displays, with significant advancements in flexible display materials [7][12]. - The demand for new display technologies, including quantum dots and Micro-LED, is increasing, driven by the need for higher resolution and energy efficiency [4][12]. Group 2: Challenges in High-End Materials - The industry faces a "bottleneck" where 90% of high-end materials are imported, particularly in areas like OLED emitting materials and glass substrates [5][7]. - Key materials such as glass substrates and target materials are dominated by foreign companies, leading to a significant reliance on imports [7][12]. - The lack of domestic production capabilities for critical materials poses a risk to the stability and competitiveness of the display industry [5][7]. Group 3: Strategic Solutions - A national-level platform is proposed to integrate resources from enterprises, universities, and research institutions to build a shared database for display materials [6]. - Leading companies are encouraged to focus on technological breakthroughs in high-purity OLED materials and ultra-thin flexible glass [6]. - Collaboration between academia and industry is essential for cultivating talent in display materials engineering to address the skills gap [6]. Group 4: Future Material Innovations - Emerging technologies such as quantum dots and Micro-LED are highlighted as future trends, with quantum dots expected to replace traditional materials due to their superior properties [4][43]. - The development of new materials like transparent PI films and COP films is crucial for the advancement of flexible displays [24][30]. - The article emphasizes the importance of overcoming the limitations of existing materials to enhance the performance and durability of next-generation displays [4][32].

Investment Rating - The report suggests a positive outlook on Sichuan Road and Bridge as a leading player in Southwest infrastructure, highlighting its current combination of regional infrastructure growth and dividend yield [3][15]. Core Insights - The report emphasizes the importance of local manufacturing in Africa, particularly for companies like Keda Manufacturing, which is positioned as a leader in localized production and sales [4][16]. - The report notes a price increase in RTF copper foil, indicating a high demand for HVLP products, and suggests continued investment in copper foil and electronic cloth sectors [5][17]. - The report tracks the performance of various materials, indicating a downward trend in cement prices and a mixed outlook for glass and fiberglass markets [6][18][22]. Summary by Sections Weekly Discussion - Sichuan Road and Bridge is highlighted for its strong position in Southwest infrastructure, with a reported investment of 134.9 billion yuan in transportation construction, ranking second nationally and showing a 3.5% increase year-on-year [3][15]. Cyclical Linkage - Cement prices averaged 340 yuan per ton, down 43 yuan year-on-year, with an average shipment rate of 44.7% [6][18]. - Glass prices increased to 1295.28 yuan per ton, reflecting a 4.58% rise, while concrete mixing stations reported a capacity utilization rate of 7.12% [6][18]. - The report warns of potential price declines in steel due to market fundamentals [6][18]. National Subsidy Tracking - The report mentions the allocation of 690 billion yuan for consumer goods replacement subsidies, with plans for further funding in October [7][19]. Important Changes - Notable acquisitions include Defu Technology's purchase of Circuit Foil Luxembourg for 174 million euros and the listing of Hanhai Group on the A-share market [8][20][21]. Market Performance - The construction materials index fell by 3.96% over the week, with specific declines in glass manufacturing and fiberglass sectors [24]. Material Price Changes - Cement prices continued to decline, with a national average of 340 yuan per ton, while glass prices showed a slight increase [32][41]. - Fiberglass prices remained under pressure, with a reported average of 3595.25 yuan per ton [66].

Investment Rating - The report does not explicitly state an investment rating for the defense and military industry but highlights a positive outlook for long-term growth potential [4]. Core Insights - The defense and military industry is expected to experience a recovery in demand as the "14th Five-Year Plan" approaches its final year, with a clear directive for modernization by 2035 and a world-class military by 2050 [4]. - The report emphasizes the significant impact of AI technology on military equipment and decision-making, showcasing its transformative value in modern warfare, particularly highlighted by the ongoing Russia-Ukraine conflict [2][39]. - The report identifies specific investment opportunities in the military sector, particularly in AI applications, low-altitude economy developments, and the upcoming commissioning of the Fujian aircraft carrier [3][38]. Summary by Sections Market Review - The defense and military index rose by 0.08% last week, ranking 6th among 31 primary industries, while the overall market indices declined [2][13]. - The current PE (TTM) for the defense and military sector is 84.92, with sub-sectors showing varied valuations, such as aerospace equipment at 146.02 and ground armaments at 189.72 [2][21]. Key Recommendations - The report recommends focusing on companies involved in downstream manufacturing, military technology, underwater equipment, missile supply chains, titanium materials, electronic components, and laser weapons [4]. - Specific companies highlighted include Hongdu Aviation, AVIC Shenyang Aircraft, and Reicoh Laser among others [4]. Industry Dynamics - The report discusses the emergence of low-altitude economy opportunities, driven by recent policy initiatives and technological advancements in drone logistics and infrastructure [3][32][37]. - The military AI sector is identified as a core growth driver, with expectations for a surge in orders for AI-enabled equipment by 2025 [40].

Investment Rating - The report maintains an "Outperform" rating for the industry [1]. Core Insights - The report highlights that AI is driving upgrades in upstream materials for PCB, with quartz fabric reshaping the competitive landscape and leading companies emerging [1]. Summary by Sections Section 1: Copper Clad Laminate (CCL) - The performance requirements for CCL are increasing due to enhanced computational efficiency [3]. - CCL is an essential material in PCB manufacturing, made from reinforced materials like glass fiber cloth and resin, coated with copper foil [8]. - High-frequency and high-speed CCL are designed for high-frequency signal transmission, requiring low dielectric constant and loss [11]. - The demand for CCL is expected to rise as AI development and data transmission speeds increase, with Df values projected to drop below 0.006 [16]. - The PCB industry is projected to grow approximately 5% year-on-year in 2024, with the global server PCB market expected to reach $16 billion by 2026, reflecting a CAGR of 12.8% from 2022 to 2026 [19]. Section 2: Electronic Fabric - The quality requirements for electronic-grade glass fiber fabric are high, with Low-Dk electronic yarn being a core material for high-frequency PCBs [34]. - Different grades of electronic fabric have varying performance indicators, with Q fabric currently being the best choice [38]. - The demand for electronic fabric is increasing due to the high-performance requirements of AI servers and 5G base stations [48]. Section 3: Quartz Fiber - Quartz fiber, with a silica content of over 99.90%, exhibits excellent thermal resistance and electrical insulation properties, making it suitable for aerospace, military, and semiconductor applications [58]. - The production of high-purity quartz fiber involves complex processes, and companies like Feilihua have established significant capabilities in this area [66][72]. - The competitive landscape for quartz fiber is evolving, with high-purity quartz fibers expected to dominate the third-generation electronic fabric market [59].

Core Insights - The recent recovery in the equity market has allowed several veteran fund managers to overcome previous performance challenges, with some returning to the "Double Ten Fund Manager" status, indicating over ten years of managing the same fund with an annualized return exceeding 10% [1][2] Performance Recovery - Active equity funds have shown a significant performance rebound, with the mixed equity fund index yielding over 15% this year, and more than a thousand active equity funds achieving returns exceeding 20% [2] - Notable veteran fund managers, such as Wei Dong from Guolian An Fund and Guo Jun from Bosera Fund, have seen their funds recover from substantial drawdowns, with Guolian An's fund returning over 20% this year and Bosera's fund achieving a 27.54% return [2][3] Investment Strategy Evolution - Many veteran fund managers have shifted their investment focus towards high-quality growth sectors, adapting their strategies to align with the current macroeconomic transition towards technology-driven and high-quality development [4][6] - Fund managers like Wang Peng from Guotai Junan have successfully identified and invested in high-growth stocks, contributing significantly to their funds' performance recovery [4][5] Long-term Investment Philosophy - The performance recovery of veteran fund managers underscores the resilience of their investment philosophies, demonstrating their ability to adapt strategies across different market phases [6][7] - Fund managers emphasize the importance of identifying leading companies in China's manufacturing sector as key to future investment success, with a focus on sectors like semiconductors and military industries [6][7]

Core Viewpoint - The article highlights the recovery of active equity funds, particularly those managed by veteran fund managers, who are regaining strong performance after a period of underperformance, with many achieving significant returns in the current market environment [1][2]. Group 1: Performance Recovery of Veteran Fund Managers - Many veteran fund managers are emerging from a period of poor performance, with some achieving returns exceeding 20% this year [2]. - Notable examples include Wei Dong from Guolian An Fund, whose fund has seen over 20% returns this year, and Guo Jun from Bosera Fund, whose fund achieved a 27.54% return [2][3]. - Yang Gu from Nuon Fund has also seen a recovery, with his fund returning 18.89% this year after a challenging period [3]. Group 2: Investment Strategy Evolution - Veteran fund managers are adapting their investment strategies, shifting focus towards high-quality growth sectors in response to changing market dynamics [4][5]. - The macroeconomic transition towards technology-driven, high-quality development is creating new investment opportunities, prompting fund managers to actively adjust their portfolios [5]. - Specific stock selections, such as WuXi AppTec and Sunshine Power, have significantly contributed to the performance of funds managed by Wang Peng and Wei Dong, respectively [5][6]. Group 3: Long-term Investment Philosophy - The article emphasizes the importance of a robust investment philosophy that can withstand market fluctuations, with veteran managers demonstrating their ability to navigate risks and seize opportunities [7][8]. - Managers like Yang Gu and Wei Dong highlight the significance of identifying leading companies in China's manufacturing sector as key to future investment success [7][8]. - The article notes that while some fund managers have successfully recovered, many are still working to enhance their investment frameworks and capabilities [8].

- The report introduces a quantitative model named "250-Day New High Distance" to track market trends and identify leading stocks. The model calculates the distance between the latest closing price and the highest closing price over the past 250 trading days using the formula: $ 250\text{-Day New High Distance} = 1 - \frac{\text{Close}_{t}}{\text{ts\_max(Close, 250)}} $ where $\text{Close}_{t}$ represents the latest closing price, and $\text{ts\_max(Close, 250)}$ is the maximum closing price in the past 250 trading days. If the latest closing price reaches a new high, the distance equals 0; otherwise, it indicates the percentage drop from the peak[10][11][12] - The report evaluates the model positively, citing its ability to capture momentum and trend-following strategies effectively. It references prior research, such as [George@2004] and insights from investment books like "Stock Market Wizard," which emphasize the importance of tracking stocks near their 52-week highs[10][18][21] - The report applies the model to major indices, showing their respective 250-Day New High Distances as of August 1, 2025: - Shanghai Composite Index: 1.54% - Shenzhen Component Index: 4.38% - CSI 300: 4.73% - CSI 500: 2.25% - CSI 1000: 1.53% - CSI 2000: 1.08% - ChiNext Index: 8.93% - STAR 50 Index: 7.99%[11][12][33] - The report identifies industries and concept indices close to their 250-Day New Highs, such as Media, Communication, Pharmaceuticals, Defense, and Steel. Concept indices like Wind Microcap Equal Weight, Electronic Equipment, CRO, and Innovative Drugs also show proximity to their 250-Day New Highs[12][14][33] - The report tracks stocks that have reached 250-Day New Highs in the past 20 trading days. A total of 1,239 stocks are identified, with the highest counts in industries like Pharmaceuticals (192 stocks), Machinery (169 stocks), and Basic Chemicals (132 stocks). The highest proportions are found in Banking (64.29%), Steel (56.60%), and Nonferrous Metals (41.94%)[19][20][34] - The report introduces a factor named "Stable New High Stocks," which selects stocks based on criteria such as analyst attention, relative price strength, price path smoothness, and sustained new highs. Specific metrics include: - Analyst attention: At least five buy or overweight ratings in the past three months - Relative price strength: Top 20% in 250-day returns - Price path smoothness: Evaluated using metrics like cumulative absolute daily returns over 120 days - Sustained new highs: Average 250-Day New High Distance over the past 120 days - Trend continuation: Average 250-Day New High Distance over the past five days[24][27][28] - The report lists 50 stocks selected as "Stable New High Stocks," with the highest counts in Manufacturing (15 stocks) and Technology (14 stocks). Examples include Shenghong Technology, Borui Pharmaceuticals, and Feilihua[28][32][34]