Core Viewpoint - Southbound capital has significantly increased its inflow into the Hong Kong stock market, with a cumulative net inflow exceeding 1.3 trillion HKD this year, marking a record high since the launch of the Stock Connect program [1][2]. Group 1: Southbound Capital Inflow - As of November 11, 2023, the net inflow of southbound capital through the Stock Connect reached 44.67 billion HKD, bringing the total for the year to 13,098.17 billion HKD, which is over 1.6 times the 8,078.69 billion HKD recorded in the same period of 2022 [1][2]. - The cumulative net inflow since the launch of the Stock Connect has surpassed 50 trillion HKD, setting a new record for the program [2]. Group 2: Holdings and Market Value - As of November 10, 2023, southbound capital held 5,573.90 billion shares, an increase of 908.52 billion shares from the beginning of 2023, with a total market value exceeding 6.3 trillion HKD, up from 3.6 trillion HKD at the start of the year [2]. - The financial, information technology, and consumer discretionary sectors have the highest market values held by southbound capital, amounting to 15,762.36 billion HKD, 13,100.89 billion HKD, and 9,018.37 billion HKD respectively [2]. Group 3: Individual Stock Holdings - Major individual stock holdings include Tencent Holdings at over 650 billion HKD, Alibaba Group at over 340 billion HKD, and several banks such as China Construction Bank and China Mobile, each exceeding 260 billion HKD [3]. - The most significant increases in holdings this year have been in China Construction Bank, with an increase of 71.41 billion shares, followed by other major banks [3]. Group 4: Investment Opportunities - Analysts highlight three main investment opportunities in the Hong Kong stock market: cyclical stocks benefiting from rising downstream commodity prices, defensive dividend stocks due to decreased market risk appetite, and stocks positioned for overseas expansion [4][5]. - The market is characterized by structural performance and significant sector rotation, with expectations of increased inflows from public funds and insurance capital [4].

Group 1 - The theme of the 2026 Capital Market Annual Conference held by CITIC Securities is "Striving for a New Journey," focusing on the global macro landscape and market investment strategies [1] - CITIC Securities General Manager Zou Yingguang highlighted the increasing international discourse power of China and the rising position of Chinese enterprises in the global value chain, indicating a positive accumulation of momentum in the capital market [1] - The "14th Five-Year Plan" period will see new characteristics in the global context, technological trends, and institutional environment affecting China's capital market [1] Group 2 - CITIC Securities Chief A-share Strategy Analyst Qiu Xiang stated that A-share companies are transitioning from local enterprises to global multinational corporations, marking a shift from emerging to mature market status [2] - Qiu Xiang noted that the overall volatility of the A-share market is expected to enter a long-term downward trend due to various mechanisms, including increased participation of retail investors seeking stable returns [2] - The influence of social media and diverse public opinion is expected to mitigate the effects of collective investor behavior, reducing the likelihood of one-sided market movements [2] Group 3 - Three key themes for industry allocation in 2026 include: upgrading traditional manufacturing and resource industries to enhance profit margins, the globalization of Chinese enterprises opening new profit growth opportunities, and a new round of systematic trends in the technology sector driven by application changes [3] - CITIC Securities Chief Economist Ming Ming anticipates a "front low, back high" growth pattern for China's economy in 2026, with moderate fiscal expansion and improved local government finances [3] Group 4 - The economic structure in 2026 is expected to be primarily production-driven, with external and internal demand becoming more balanced [4] - Fiscal policy is projected to moderately expand, with an increase in special bond quotas for project construction, while monetary policy may see further easing with potential rate cuts [4] - The focus of industrial policy during the "14th Five-Year Plan" period will shift towards balancing supply and demand, enhancing service consumption and investment in emerging industries to boost domestic demand's contribution to GDP [4]

Group 1: Electrolytic Aluminum Sector - The overseas electricity supply gap is leading to strong production cut expectations, which may result in a re-evaluation of China's industrial advantages in the electrolytic aluminum sector [2][5] - The U.S. electricity net imports reached 20.94 terawatt-hours from January to September 2025, a year-on-year increase of 125%, indicating a growing electricity supply risk [2] - Domestic electrolytic aluminum industry is expected to maintain cost advantages in the medium term, regardless of whether it relies on thermal or hydropower [1][2] Group 2: Special Steel New Materials Sector - Domestic advancements in nuclear energy technology are leading to increased interest in the special steel sector, particularly materials that can withstand extreme conditions in nuclear applications [3] - The successful installation of the BEST superconducting magnet in Hefei is expected to be the first device to achieve nuclear fusion power generation [3] - Investment opportunities are emerging in special steel companies that supply key materials for nuclear energy devices [3][5] Group 3: Lithium Carbonate Sector - The demand for energy storage is significantly increasing due to overseas electricity shortages, leading to a recovery in the lithium carbonate supply chain prices [4] - As of November 6, lithium hexafluorophosphate reached a two-year high of 119,800 yuan per ton, contributing to the rise in lithium carbonate prices to 80,200 yuan per ton on November 7 [4] - The entire lithium carbonate supply chain is expected to see both volume and price increases in the medium term [4][6] Group 4: Investment Recommendations - For the electrolytic aluminum sector, companies like Tianshan Aluminum (002532.SZ) are recommended due to continuous cost reductions and potential volume-price increases in 2026 [5] - In the special steel new materials sector, companies such as Jiuli Special Materials (002318.SZ) and Fushun Special Steel (600399.SH) are highlighted for their involvement in key nuclear power equipment [5] - In the lithium carbonate sector, companies like Yongxing Materials (002756.SZ) and Zhongkuang Resources (002738.SZ) are suggested for investment [6]

Investment Rating - The report maintains a "Positive" investment rating for the non-ferrous and steel industry in China [6]. Core Viewpoints - The report emphasizes the importance of addressing overseas electricity shortages with Chinese solutions, particularly in the context of rising industrial electricity costs due to increasing energy prices in major countries [9][14]. - It highlights the potential for significant growth in the electrolytic aluminum sector driven by export demand, as overseas power supply issues lead to production cuts [14]. - The report also points out investment opportunities in the special steel sector, particularly related to advancements in nuclear fusion technology [15]. - The lithium carbonate sector is expected to benefit from a surge in overseas energy storage demand, with prices across the supply chain showing signs of recovery [16]. Summary by Sections 1. Non-Ferrous Metals - The report suggests that electrolytic aluminum, special steel, and lithium carbonate are primarily driven by domestic demand, but it presents a contrasting view that focuses on overseas electricity shortages as a growth opportunity [9][13]. - The electrolytic aluminum sector is poised for a revaluation due to strong production cut expectations stemming from overseas electricity shortages [14]. - The special steel sector is highlighted for its potential growth linked to nuclear fusion advancements, with significant demand expected for materials that can withstand extreme conditions [15]. - The lithium carbonate sector is experiencing a price rebound, with recent contracts indicating a positive outlook for the entire supply chain [16]. 2. Steel Industry - The steel industry is facing short-term profitability pressures, with slight declines in iron and steel production noted [17][19]. - Inventory levels for both social and steel mill stocks are decreasing, indicating a tightening supply [24]. - The report notes a general decline in steel prices, with various product categories experiencing price drops [34]. - Cost pressures are evident, with mixed trends in raw material prices impacting profitability across different steel production processes [27][30]. 3. New Energy Metals - The report indicates a significant year-on-year increase in lithium carbonate production, reflecting a robust supply response to market demand [39]. - The demand for new energy vehicles remains strong, with production and sales figures showing substantial growth [43]. - Price trends for lithium and nickel are mixed, with lithium prices experiencing a notable decline while cobalt prices have seen increases [48][50].

前期受北美AIDC缺电概念影响，电网板块持续走强。当前北美AI产业快速发展，市场对北美算力需求 将大幅增长已达成共识。北美官方机构此前预测未来5年数据中心累计装机量约为30-100GW的水平，而 北美AIDC实际需求可能不断超出预期。面对负荷不断增长的巨大压力，当前北美电源电网难以应对。 根据长江证券的测算，在不考虑大区电网互联带来的抵消作用下，2025-2030年美国将合计产生约 73.2GW的电力总缺口，若数据中心增长超预期，则可能产生201GW的电力总缺口。2025-2027年将是压 力最大的阶段，随着2028年有效电源预测装机的集中投运，压力将稍有缓解，但依然存在一定的电力缺 口。总体来看，未来美国缺电情况将会愈演愈烈。预计美国缺电或将会带动储能、电气设备、电网设备 等领域的出海发展。 2025年1-9月，我国变压器累计出口金额为350.92亿元，同比增长52.73%，呈现高增长态势。国内企业 凭借特高压、智能电网等大型工程积累的技术和经验，在海外市场优势明显。 今日，电网板块回调，电网ETF（561380）跌超1.5%，盘中溢价交易。 电网ETF跟踪恒生A股电网设备指数，电网设备占比超半数，覆盖电网 ...

Core Viewpoint - The report from Ping An Securities indicates that Unisplendour Co., Ltd. experienced a decline in net profit for the first three quarters of 2025, while showing strong revenue growth in the same period [1] Financial Performance - The company achieved a net profit attributable to shareholders of 1.404 billion yuan, a year-on-year decrease of 11.24% [1] - Quarterly revenue figures are as follows: Q1 revenue was 20.79 billion yuan (up 22.25% year-on-year), Q2 revenue was 26.635 billion yuan (up 27.17% year-on-year), and Q3 revenue was 29.897 billion yuan (up 43.12% year-on-year) [1] Business Development - Unisplendour is a leading player in the domestic ICT infrastructure industry and has completed the acquisition of a 30% minority stake in its subsidiary, H3C, enhancing its core competitiveness [1] - The company is developing an integrated AI-enabled platform, accelerating its comprehensive layout from computing power to application, and is expected to benefit significantly from the growth opportunities in the AI industry due to its "computing power × connectivity" synergy [1] - The international business of the company is also showing strong growth momentum, which is anticipated to become an important driver for future development [1] Investment Outlook - The firm maintains a "recommended" rating for the company's future development prospects [1]

Summary of Conference Call on Sanxiang New Materials Industry Overview - The demand for high-temperature alloy materials and hafnium oxide is surging due to the development of global defense, aerospace, and AI industries, particularly in the storage chip sector where hafnium oxide is replacing silicon dioxide as an insulating layer to address challenges from smaller process nodes [1][2] Company Insights: Sanxiang New Materials Core Business and Developments - Sanxiang New Materials is focused on an integrated layout of the zirconium industry chain, possessing the most comprehensive product categories, largest production capacity, and optimal processes globally [1] - The company has initiated a new zirconium separation project expected to commence production in Q2 2026, aiming to enhance purity to above 5N to meet high-end market demands [1][4] Market Dynamics - The market price for zirconium has reached approximately $7,000 per kilogram in Europe and the U.S., driven by strong downstream demand from nuclear power, storage chips, and gas turbines [2] - The supply of zirconium and hafnium is constrained due to their natural association in zircon ore, with separation being challenging and past nuclear power construction stagnation limiting hafnium production [5] Technological Advancements - Sanxiang employs a chlorination method for zirconium-hafnium separation, collaborating with universities to develop a novel extraction agent that has achieved 5N purity, addressing issues of environmental pollution and high costs associated with traditional methods [1][8] Future Projections - The company plans to expand nuclear-grade zirconium production starting in 2025, with a target of producing 50-70 tons of hafnium oxide as a byproduct from existing operations [3][9] - Sanxiang aims to achieve full production capacity and maximize efficiency by leveraging its integrated supply chain and technological advantages [10] Market Trends and Pricing - The demand for high-end materials is robust, with expectations for steady price increases due to domestic storage chip industry expansion and international market needs [11] - The projected prices for electronic-grade products are around 8 million yuan, while atomic energy-grade products are expected to be priced between 5-6 million yuan [11] Strategic Positioning - Sanxiang positions itself in the mid-to-high-end market, focusing on material differentiation to gain competitive advantages and maintain pricing power despite potential market fluctuations [12] - The company aims to become a leading player in the global market, targeting a top-two position in the industry [12] Performance Expectations - Sanxiang anticipates entering a new growth phase starting in 2025, supported by new nuclear power units and enhanced product profitability [13] Client Base and Market Penetration - Potential clients include companies in high-temperature alloys, control rods, and the semiconductor sector, with ongoing sample deliveries to major domestic firms [15][14] Production Capacity and Export Plans - The company is currently capable of producing electronic-grade materials, with plans to export these products internationally as market conditions allow [21][22] Conclusion - Sanxiang New Materials is strategically positioned to capitalize on the growing demand for zirconium and hafnium, leveraging its technological advancements and integrated supply chain to enhance market competitiveness and achieve significant growth in the coming years [1][12][13]

Core Insights - Since October, value style has begun to outperform growth style, marking a significant shift compared to the dominance of growth represented by TMT in Q2-Q3 [2][10] - The cyclical rotation between growth and value styles typically occurs over a 2-3 year period, primarily driven by changes in profit trends [2][11] - The fourth quarter is prone to style changes, particularly in December, as investor allocation strategies shift based on economic and profit outlooks [2][16] Summary by Sections Strategy Viewpoint - The current growth style has been dominant since September 2024, lasting about one year, and is expected to continue due to the upward trend in AI and high-end manufacturing [3][11] - Q4 is historically a high-frequency period for style changes, especially in December, as investors focus on stability and valuation safety margins [3][16] - Historical examples of style shifts include the strong switch to blue-chip stocks in late 2014 and a more balanced style shift in late 2019 [3][17] Market Changes - The report indicates that the probability of value style outperforming in December significantly increases, with historical data supporting this trend [7][20] - The report highlights that in 2014, the non-bank financial sector saw a substantial rise, with the Shanghai Composite Index showing a rapid increase in excess returns [17][21] - In 2019, a valuation repair shift occurred, leading to a more balanced market style, with previously weak sectors rebounding [23][24] Industry and Sector Recommendations - The report suggests focusing on low-valuation sectors, particularly in finance, as they may benefit from the anticipated style shift [32][33] - Specific sectors recommended for investment include non-bank financials, electric equipment, steel, and chemicals, with an emphasis on their potential for recovery and growth [35][36] - The report notes that the financial sector's valuation remains attractive, with expectations of recovery driven by regulatory support and market conditions [35][36]

Domestic Insights - In October, China's exports unexpectedly turned negative, with a year-on-year decline of 1.1%, compared to a previous growth of 8.3%[22] - High-frequency data indicates a significant rebound in export orders from late October to early November, attributed to the implementation of trade agreements between China and the U.S.[19] - The Q4 export growth rate is expected to decline due to a high base from the previous year, alongside the "15th Five-Year Plan" aiming for stable growth policies in November and December[19] Overseas Insights - In October, the U.S. ADP employment numbers exceeded expectations with an increase of 42,000 jobs, while Challenger job cuts surged by 175% year-on-year to 153,074[20] - The liquidity crunch in the U.S. money market is primarily due to the government shutdown, which has forced the Treasury to increase cash balances from $300 billion to $1 trillion, creating a draining effect on the market[20] - The Supreme Court's rapid review of the legality of Trump's tariffs could lead to a ruling by the end of December, potentially accelerating the implementation of Section 232 tariffs[20] Asset Market Analysis - The recent high valuations in the U.S. AI sector have sparked global trader concerns, with historical bubbles linked to industry trends and monetary policy factors[21] - The potential for a market rebound is anticipated around May 2025, coinciding with a change in the Federal Reserve chair, which may signal stronger easing measures[21] - Short-term adjustments in U.S. stocks may not be complete, while domestic asset styles are trending towards balance[21]

Core Viewpoint - The company reported significant growth in revenue and net profit for the first three quarters of 2025, driven by improved demand and the introduction of high-end products [1][2]. Financial Performance - For the first three quarters of 2025, the company achieved revenue of 852 million yuan, a year-on-year increase of 37.76%, and a net profit attributable to shareholders of 139 million yuan, a remarkable increase of 1696.45% [1]. - In Q3 2025, revenue reached 302 million yuan, up 43.10% year-on-year, while net profit was 51 million yuan, reflecting a year-on-year increase of 644.41% [1]. Market Trends - The PCB electronic industry experienced rapid growth in the first half of 2025, with a notable improvement in supply and demand dynamics [1]. - The demand for high-end products is increasing, with a higher proportion of high-density interconnect (HDI) applications and advancements in CCL material design towards high-performance, low dielectric constant, and low thermal expansion coefficient materials [1]. Product Development - The company has started to introduce high-end products, leading to an improved product structure and overall price recovery in electronic glass fiber and cloth [1]. - In the first nine months of 2025, the company sold 163 million meters of electronic cloth at an average price of 4.97 yuan/meter, a year-on-year increase of 33.6%, with price increases being the primary driver of revenue growth [1]. Expense Management - The company reported an improvement in expense ratios for sales, management, R&D, and financial costs, with a total expense ratio of 12.48%, down 0.67 percentage points year-on-year, attributed to increased revenue and scale effects [2]. Future Projects - The company plans to issue shares to raise up to 995 million yuan, primarily for the construction of a high-performance glass fiber production line, expected to produce 1,254 tons of high-performance electronic yarn annually [2]. - The project is anticipated to enhance raw material quality and capacity, aligning with new demands in the AI era, with a post-tax internal rate of return (IRR) of 14.4% and a static payback period of 8.26 years [2]. Investment Outlook - The company is projected to achieve net profits of 191 million yuan, 269 million yuan, and 348 million yuan for the years 2025, 2026, and 2027, respectively, with corresponding price-to-earnings ratios of 153.07x, 108.37x, and 83.88x [3].