Summary of Nuclear Renaissance – Key Questions For 2026 Industry Overview - The report focuses on the nuclear energy sector, highlighting the potential for a nuclear renaissance in 2026 and the investment opportunities within the nuclear value chain [2][12]. Key Questions and Insights 1. **Conventional Nuclear Supply** - Incremental nuclear supply is expected in the US, Japan, and China, with a more positive outlook for the US and Japan. The fastest pathways to add capacity are restarts and life extensions of existing reactors [13][14]. - Japan's nuclear policy is supportive, with recent approvals for reactor restarts, while the US has several plant restarts underway, including Palisades and Crane Clean Energy Center [15][16]. 2. **Small Modular Reactors (SMRs)** - The SMR market is becoming selective, with only projects that have clear regulatory pathways and credible financing likely to succeed. Demand from hyperscalers is strong, but execution risks remain [3][17]. - Currently, only four SMRs are operational globally, with many still in the design phase [20]. 3. **Nuclear Fuel Supply Chain** - Uranium is highlighted as a preferred commodity for 2026, with utilities returning to the market and spot buying remaining robust. The expected price is projected to reach US$90/lb by Q3 2026 [4][23]. - The supply chain is constrained, with long-term contracting activity improving as US utilities re-engage in the uranium market [24][30]. 4. **Fusion and Thorium Technologies** - Fusion and thorium remain long-term technologies with limited near-term impact on power supply. However, they are gaining attention and funding, indicating potential future relevance [5][31]. - China is advancing thorium technology with active projects, while the US is restarting research on molten salt reactors [33][36]. Investment Opportunities - The report identifies 26 Overweight-rated stocks across the nuclear value chain, including: - **Nuclear Power Generation**: Talen Energy, Public Service Enterprise Group, Hokkaido Electric Power [2][11]. - **Uranium Mining**: CGN Mining, Paladin Energy [4][11]. - **Equipment & Plant**: Curtiss-Wright, GE Vernova, Rolls-Royce [3][11]. Market Performance - Uranium mining stocks have shown significant outperformance, indicating strong investor interest and potential for growth in this sector [6][11]. Monitoring Signals for 2026 - Key signals to watch include: - Japan's safety review processes and government support for nuclear projects [16]. - Progress on US nuclear plant restarts and regulatory streamlining [16]. - Long-term uranium contracting trends and advancements in enrichment capacity [30][31]. Conclusion - The nuclear sector is poised for growth, driven by increasing demand for clean energy and supportive policies in key markets. Investors are encouraged to focus on companies with strong fundamentals and clear pathways to capitalize on the nuclear renaissance [2][12].

机构：招银国际 研究员：Wayne Fung What's new? According to news report , the draft by Kazakhstan lawmakers to tighten the control of uranium mining JVs has been passed by the lower house and await Senate review. The draft requires Kazatomprom (KAP LN, NR), the state-owned and world largest uranium producer in terms of production volume, to receive 90% stake in JV upon contract renewal. KAP has long been having a number of JVs with different foreign partners in uranium mining in Kazakhstan. According to KAP, negotiatio ...

Summary of Key Points from the Conference Call Industry Overview - The conference focused on the basic materials sector in China, particularly metals, power equipment, and energy storage systems (ESS) [1] - Featured insights from 35 experts and companies, including Zijin, Chalco, Hongqiao, CMOC, and CGN Mining [1] Aluminum Sector - **Demand and Supply Dynamics**: Strong aluminum demand driven by electrification and substitution for copper, with a price ratio of approximately 4x [2][8] - **Market Prices**: Aluminum prices exceeded Hongqiao's previous guidance of RMB 20,600–21,300 per ton, supported by fundamentals and potential global smelter shutdowns [2][9] - **Cost Drivers**: Power tariffs are a significant cost factor, with Hongqiao's average tariff at RMB 0.38/kWh in Q3 [2][10] - **Strategic Initiatives**: Hongqiao plans to increase capacity from 1.96 million tons to 2.16 million tons by year-end and is focusing on overseas bauxite expansion [2][11][12] Copper Sector - **Price Forecast**: SMM forecasts copper prices to average US$10,600–11,200 per ton in 2026, with potential spikes to US$12,000 per ton due to tight supply [3][18] - **Supply and Demand**: Global copper supply expected to rise by ~900kt next year, with demand growth projected at ~3%, primarily from EVs and wind power [3][20] - **Production Challenges**: Zijin's 2025 copper output may fall short due to the suspension of the Kakula mine, but long-term guidance remains intact [3][21] Uranium Sector - **Market Revival**: Uranium demand is rebounding as nuclear power becomes a stable energy source for AI and data centers, with a supply-demand gap of ~60kt vs. ~75kt [4][32] - **Price Stability**: Spot prices hover around USD80/lb, with term contracts limiting downside risk [4][32] - **Future Demand Drivers**: Increased nuclear power station construction and the deployment of small modular reactors (SMRs) are expected to drive future uranium demand [4][30] Tungsten and Molybdenum - **Tungsten Market**: Faces a structural deficit with China producing 83% of global tungsten. Domestic concentrate prices have doubled YoY to RMB 300k/t due to supply constraints [35] - **Molybdenum Trends**: China supplies ~50% of global molybdenum, with demand outpacing supply growth. Prices are expected to remain firm through 2030 [36] Strategic Initiatives and Financial Outlook - **Chalco's Capex**: Projected future capital expenditure of RMB 15-20 billion annually, focusing on resource extension and operational efficiency [2][17] - **Shareholder Returns**: Hongqiao is considering a share buyback exceeding US$3 billion, indicating confidence in cash flow and growth prospects [2][12] - **CMOC's Financial Position**: Strong operational performance with a projected annual capex of USD1 billion for the next few years [24][26] Investment Risks - **Market Risks**: Potential asset impairments and economic shutdowns in alumina operations could pose risks to future performance [17] - **Geopolitical Risks**: Geopolitical tensions may affect supply chains and market stability, particularly in uranium and tungsten sectors [30][35] Conclusion - The conference highlighted robust demand across the metals sector, with strategic initiatives aimed at enhancing production capacity and shareholder value. However, challenges such as supply constraints, geopolitical risks, and fluctuating prices remain critical considerations for investors.

Summary of Key Points from the Conference Call Industry Overview - **Industry**: AI Infrastructure in China - **Projected AI Capex**: China’s AI capital expenditure (capex) is expected to reach RMB800 billion (approximately US$110 billion) by 2030, accounting for one-third of total AI capex in China [1][62] - **Global AI Capex**: Global AI-related capex is projected to exceed US$1.2 trillion by 2030, nearly tripling from 2025 levels [1][54] - **China's AI Capex Growth**: Expected to grow from RMB600-700 billion (US$85-95 billion) in 2025 to RMB2-2.5 trillion (US$280-350 billion) by 2030, with a CAGR of 25-30% [1][61] Power Demand and Data Centers - **Power Consumption**: China's data centers are projected to consume 277 TWh of electricity by 2030, up from 102 TWh in 2024, representing a CAGR of 18% [1][42] - **Global Data Center Power Demand**: Global data center power consumption is expected to grow 2.3 times from 416 TWh in 2024 to 946 TWh in 2030 [1][28] Opportunities in Power Supply - **Nuclear Power**: China's nuclear capacity is expected to grow from 60 GW in 2025 to 100 GW in 2030, accounting for 60% of global capacity under construction [2][29] - **Power Equipment Demand**: Strong demand for transformers and power equipment is anticipated due to grid upgrades and rising renewable energy investments [2][45] - **Energy Storage Systems (ESS)**: The global ESS market is expected to grow at a CAGR of 21% from 2024 to 2030, with significant growth in China [2][47] Cooling and Metals Demand - **Cooling Market Growth**: The liquid cooling market in China is expected to grow at a CAGR of 42% from 2025 to 2030, driven by the increasing power density of AI workloads [3][50] - **Copper and Aluminum Demand**: Direct AI use of copper is projected to reach approximately 1 million tons by 2030, accounting for 5-6% of total copper demand. Data centers are expected to drive 936 kt of copper demand by 2030 [3][49] Investment Recommendations - **Key Stocks**: - **Power Equipment**: Buy recommendations for Sieyuan, Jinpan, and Huaming due to expected growth in power equipment demand [2][45] - **Nuclear**: Buy CGN Mining and Doosan Enerbility for exposure to nuclear power growth [2][44] - **Cooling Solutions**: Buy AVC for liquid cooling solutions [3][50] - **Metals**: Buy Zijin Mining, CMOC, and Chalco for copper and aluminum exposure [3][49] Additional Insights - **Government Support**: Continued government spending and initiatives are expected to drive AI capex growth in China [1][61] - **Energy Security**: The link between AI leadership and energy security is emphasized, highlighting the need for reliable power sources [1][42] - **Technological Advancements**: Emerging technologies in cooling and power supply are expected to create further investment opportunities [2][48] This summary encapsulates the critical insights and projections regarding the AI infrastructure landscape in China, highlighting the expected growth in capital expenditure, power demand, and investment opportunities across various sectors.

Summary of Conference Call Notes Industry Overview - **Industry**: New Materials in China - **Key Focus Areas**: Lithium, Uranium, Rare Earths, Solar Glass Key Points and Arguments Lithium Market - **Demand**: Year-to-date lithium demand has exceeded market expectations, driven by strong demand from Energy Storage Systems (ESS) and ongoing electric vehicle (EV) trade-in programs [2] - **Supply Risks**: Yichun lepidolite mines are undergoing resource reclassification, which may lead to temporary shutdowns. These mines collectively produce approximately 150,000 tons of Lithium Carbonate Equivalent (LCE) annually [2] - **Cost Dynamics**: The cost curve for lepidolite mines is expected to rise due to increased royalties and fees, with cost support estimated at around RMB 70,000 per ton [2] Uranium Market - **Price Momentum**: Strong momentum in uranium prices is anticipated, supported by major investment vehicles like SPUT and Yellow Cake purchasing in the spot market. Long-term prices are expected to rise post-World Nuclear Symposium, with current spot prices around US$83 per pound [3] - **Supply Adjustments**: Production cuts from Kazatomprom and Cameco highlight ongoing supply risks, benefiting CGN Mining, which has increased its spot price exposure to 70% from 60% due to a renewed three-year contract [3] Rare Earths and Magnets - **Price Strength**: Rare earth prices are robust due to strong downstream demand and China's supply-side controls. Magnet producers are expected to pass price increases to customers, improving gross profit margins [4] - **Export Recovery**: Export volumes for magnet producers are normalizing, with anticipated improvements in shipment volumes and earnings in the second half of the year [4] Solar Glass Market - **Demand Decline**: Demand for solar glass has softened in October and is expected to weaken further into winter, leading to inventory build-up and downward pressure on prices [5] - **Earnings Impact**: The anticipated decline in solar glass prices could negatively affect company earnings if no supply-side controls are implemented [5] Additional Insights - **Equity Ratings**: Various companies within the new materials sector have been rated with "Overweight" or "Equal-weight" based on their market positions and expected performance [10][11] - **Price Target Adjustments**: Price targets for several companies have been adjusted based on updated earnings forecasts and market conditions, reflecting changes in commodity prices and company performance [19][20] - **Market Sentiment**: The overall sentiment in the new materials sector remains attractive, with potential upside from uranium recovery and stable demand in rare earths, despite challenges in lithium and solar glass markets [1][7] Conclusion The new materials sector in China is experiencing mixed dynamics, with strong demand in lithium and uranium markets, while facing challenges in solar glass. Companies are adjusting their strategies and forecasts in response to evolving market conditions, highlighting the importance of monitoring supply risks and price movements in this sector.

Summary of Key Points from the Conference Call Industry Overview - **Industry Focus**: The conference call discusses the energy sector in Asia, particularly the nuclear power and renewable energy industries, highlighting the strategic importance of these sectors amid rising electricity demand and geopolitical tensions [1][2][4][9][38]. Core Insights and Arguments - **AI-Driven Power Demand**: Global electricity demand is projected to grow at a CAGR of 3.7% from 2024 to 2026, with emerging markets in Asia, particularly China and India, expected to drive 60% of this growth [9][10]. Data centers are anticipated to increase their share of global electricity use from 1-2% to 3-4% by 2030, contributing a 0.3% CAGR to overall power demand [1][10]. - **Green Energy Transition**: Renewables now account for over 45% of global electricity capacity, a 15 percentage point increase over the past decade, primarily replacing coal rather than adding new supply [2][20][21]. - **Nuclear Power's Role**: Nuclear energy, with a capacity factor exceeding 90% and zero carbon emissions, is positioned as a key player in providing clean baseload power. Investment in nuclear has surged, growing at a ~14% CAGR from 2020 to 2024 [3][22][30]. The share of nuclear in global generation is projected to rise from ~9% today to over 12% by 2040 [22]. - **Investment Opportunities**: The Asia Nuclear Power basket (GSSZNUCL) has been introduced to capture investment opportunities in companies involved in the nuclear energy cycle. This basket, along with Environmental & Renewables (GSSZEVMT) and Power & Electricity (GSSZPOWE), forms the Power Up Asia aggregate basket (GSSZPOWU) [5][38]. Important but Overlooked Content - **Diverging Energy Landscape in Asia**: Different countries in Asia are taking varied approaches to energy transition. China is leading in energy transition investments, while Japan is restarting nuclear plants, and South Korea is expanding its nuclear footprint. India is focusing on renewables and coal to address power deficits, and Australia remains a key uranium exporter [4][35]. - **Core-Satellite Investment Recommendation**: The recommendation is to accumulate or buy nuclear stocks on weakness, given their strong year-to-date performance (+40%). Renewables are also favored due to China's anti-involution policy trends, while Power and Electricity sectors are seen as stable with compelling valuations [6][41][42]. - **Valuation Trends**: Nuclear stocks have recently experienced a sharp re-rating, now trading at the highest P/E multiples, while Power & Electricity stocks remain relatively inexpensive compared to their historical averages [44][59]. Conclusion - The conference call emphasizes the strategic importance of nuclear and renewable energy in Asia's energy landscape, driven by rising electricity demand and the need for energy security. Investment opportunities are highlighted through the introduction of specific baskets targeting these sectors, with a focus on the long-term growth potential of nuclear energy amidst a backdrop of technological innovation and policy support [38][64].

Summary of Key Points from the Conference Call Industry Overview - The conference call focused on the energy landscape in Asia, particularly in the context of ASEAN, China, and India, highlighting the future of energy in these regions [1][5][6][8]. Core Insights India - **Energy Security and Capex Cycle**: India is experiencing a tightness-driven capital expenditure cycle in energy security [8]. - **Manufacturing Growth**: Strong demand tailwinds are expected, with manufacturing's share of GDP projected to increase to 21% by 2031 [11]. - **Supply-side Constraints**: - State-owned coal plants are delayed by an average of 54 months due to various issues such as clearances and funding [18]. - Hydro power plants face delays averaging 58 months, with potential for further delays due to unpredictable weather [20]. - Renewable energy (RE) additions are slower than anticipated, with significant capacity under construction and long gestation periods for pumped storage projects [23][27]. - **Government Response**: The government is taking measures to address supply tightness, including improving coal availability and reviving thermal coal sub-contractors [28]. Japan - **Strategic Energy Plan**: The Japanese government aims for energy self-sufficiency to rise from 15% in FY3/24 to approximately 30-40% by FY3/41 [34]. - **Electricity Output and GHG Emissions**: - Electricity output is expected to increase from 985.4 billion kWh to approximately 1.1-1.2 trillion kWh by FY3/41 [34]. - GHG emissions are targeted to reduce by 73% compared to FY3/14 levels by FY3/41 [39]. - **Power Generation Breakdown**: By FY3/41, renewables are expected to constitute approximately 40-50% of the energy mix, with solar power projected to rise from 9.8% to 23-29% [36]. Nuclear Power Insights - **Global Nuclear Capacity**: Under different scenarios, global nuclear capacity could reach between 421GW to 1,203GW by 2050, with significant contributions from China and India [57]. - **Nuclear Power in Various Regions**: - The U.S. is seeing increased nuclear power usage for data centers, while China is rapidly expanding its nuclear capacity [49]. - Japan's draft 7th Strategic Energy Plan anticipates nuclear power to account for about 20% of electricity supply by FY3/41 [49]. - India has set an ambitious target of 100GW of nuclear power by 2047 [49]. Additional Important Points - **Supply Chain Challenges**: The energy sector faces challenges such as land availability, skilled manpower shortages, and equipment supply issues, which could hinder the growth of renewable energy projects [27]. - **Investment Opportunities**: The ongoing energy transition in Asia presents potential investment opportunities, particularly in renewable energy and nuclear power sectors [29][45]. This summary encapsulates the critical insights and data points discussed during the conference call, providing a comprehensive overview of the current state and future outlook of the energy sector in Asia.

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Nuclear Energy - **Theme**: Nuclear Renaissance, intersecting with global megatrends such as Tech Diffusion, Multipolar World, and Future of Energy [1][5][8] Core Insights and Arguments - **Nuclear Capacity Projections**: Global new nuclear capacity is projected to reach **586.8 GW** by **2050**, a **53%** increase from previous estimates [7][10][12] - **Investment Forecast**: Potential investment in the nuclear value chain through **2050** is estimated at **US$2.2 trillion**, up from **US$1.5 trillion** [7][11][12] - **Regional Growth**: China, the US, CEEMEA, and India are expected to lead in nuclear capacity growth, with Asia emerging as a key investment region [7][10] - **Stock Exposure**: The report identifies **63 stocks** that are exposed to the nuclear renaissance, expanding from an earlier list of **51 stocks** [8][17] Key Trends and Opportunities - **Tech Diffusion**: Nuclear power is seen as a premium energy source in the age of AI, emphasizing reliability and energy density. Key stocks include Talen Energy, Public Service Enterprise Group Inc, and Vistra Corp [9][19] - **Multipolar World**: South Korea and Japan are positioned to benefit in the global nuclear market amid competition from China and Russia. Notable companies include Doosan Enerbility and Samsung C&T [9][19] - **Future of Energy**: Small Modular Reactors (SMRs) and Fourth Generation reactors are highlighted as promising technologies, with companies like Curtiss-Wright and GE Vernova mentioned [9][19] Policy and Market Sentiment - **Investor Sentiment**: The proportion of global assets under management (AUM) excluding nuclear power has decreased to **2.3%**, indicating a shift in investor attitudes [14][51] - **Development Banks**: Institutions like the World Bank are reassessing their stance on nuclear energy, lifting bans on financing nuclear projects, which could enhance investment opportunities [51][52] Regional Insights - **China**: Fastest nuclear buildout, on track to reach **200 GW** by **2040**. The country is a pioneer in Gen-IV and nuclear fusion technology [23][38] - **India**: Ambitious target to expand nuclear capacity to **100 GW** by **2047**, with significant growth expected [40][38] - **CEEMEA**: Emerging as a significant market for nuclear energy, with Poland and Turkey leading the pipeline [39][10] Additional Noteworthy Points - **Technological Advancements**: The report discusses advancements in Gen-IV reactors and thorium-based technologies, with China and India making strides in these areas [20][21] - **Market Performance**: Nuclear stocks have outperformed the MSCI ACWI index year-to-date, indicating strong market interest [28][29] This summary encapsulates the key insights and projections regarding the nuclear energy sector, highlighting investment opportunities and regional dynamics that could shape the future of the industry.

Investment Rating - The report maintains a "Hold" rating for CGN Power and Dongfang Electric, with target prices adjusted to HKD2.90 (from HKD2.70) and HKD12.30 respectively. Hyundai E&C is rated as "Buy" with a target price of KRW93,000 [4][10][51]. Core Insights - China's nuclear power capacity is projected to reach 66GW by 2025 and 110GW by 2030, accounting for 7% of the power supply mix by 2030, up from 5% in 2024. This growth is supported by the approval of at least 10 new reactors annually since 2022 [2][9][13]. - The development of small modular reactors (SMRs) is highlighted as a key area for expansion, with several projects nearing commercial operation. However, the high levelized cost of energy (LCOE) for SMRs compared to large-scale reactors and renewables presents challenges for domestic deployment [3][28][30]. - The report emphasizes the importance of equipment and turnkey solution providers in capturing growth in the nuclear sector, as they are better positioned than utilities, which face longer return profiles and tariff variations [4][9]. Summary by Sections China's Nuclear Power Development - China's nuclear capacity is on track to nearly double by 2030, with significant investments in new technologies including SMRs and fusion [9][12]. - The government aims for 70GW of nuclear power by 2025, with expectations to surpass 110GW by 2030 as approvals accelerate [13][30]. Small Modular Reactors (SMRs) - China is advancing in SMR technology, with projects like Shidao Bay 1 and Changjiang Linglong-1 nearing commercial operation. However, the current capex for SMRs is significantly higher than for large-scale reactors [3][28]. - The ACP100 reactor, designed for multiple applications, is set for grid connection by 2026, showcasing China's capability in SMR development [22][28]. Investment Opportunities - Key players in the nuclear supply chain include CGN Power, Dongfang Electric, and Hyundai E&C, with the latter benefiting from global nuclear expansion [4][10]. - The report identifies potential for SMR technology exports, particularly to developing markets with limited grid capacity [32]. Fusion Power - Fusion power is still in early stages, with significant challenges in achieving sustainable reactions. However, China is investing in fusion research with a target to build an industrial prototype by 2035 [33][38]. - Opportunities in the supply chain for fusion-related equipment are anticipated, driven by ongoing experimental projects [42]. Uranium Market - China's reliance on uranium imports remains high, with current prices elevated due to geopolitical tensions. The demand for uranium is expected to double by 2040, driven by the expansion of nuclear capacity [45][49].

Investment Rating - The industry view for Greater China Materials is rated as Attractive [6] Core Insights - Lithium demand may be pressured by trade tensions, with a market surplus expected to increase to approximately 10,000 tons of lithium carbonate equivalent (LCE) in April, leading to downward pressure on prices [2][3] - Uranium fundamentals remain solid despite a spot price correction, with term pricing stable at around US$80 per pound, indicating a constructive medium-to-long-term supply-demand outlook [3] - Solar glass prices are likely to stabilize due to supply responses, although pressures are expected to persist in the second half of 2025 as demand decreases [4][10] Summary by Sections Lithium - Demand in 1Q25 was stronger than expected due to EV trade-in programs and energy storage system (ESS) demand, but the peak season in 2Q25 is anticipated to be muted due to earlier demand pull-forward [2] - Tariff uncertainties have caused large EV makers to pause April order books, leading to a potential price bottom for lithium carbonate at approximately Rmb65,000 per ton [2] Uranium - The spot price has declined to around US$60 per pound, influenced by uncertainties regarding Russian enriched uranium and US tariffs, but the gap between spot and term prices has widened, limiting further downside [3] - Supply imbalances are expected to gradually reflect in the market, potentially pushing uranium prices higher and benefiting companies like CGN Mining [3] Solar Glass - A reasonable recovery was noted in 1Q25, with prices rebounding due to increased demand from module producers, but a decrease in demand is expected in June as rush installations conclude [4][10] - The near-term supply and demand for solar glass could remain solid, supporting earnings recovery for producers, but increased industry supply may pressure prices again in 2H25 [10] Rare Earth Magnets - An upward trend in rare earth prices is anticipated due to new smelting regulations and tariffs, which could tighten supply from imports, benefiting producers [11] Stock Ratings - Overweight-rated stocks include Xinyi Solar, CGN Mining, and various rare earth magnet producers, with significant upside potential noted for several companies [12][13]