1. Report Industry Investment Rating - No industry investment rating is provided in the report. 2. Core Viewpoints - This week (20260323 - 20260327), there were no new issuances of secondary capital bonds in the inter - bank and exchange markets [1]. - The weekly trading volume of secondary capital bonds this week was approximately 177.9 billion yuan, a decrease of 10.5 billion yuan compared to last week. The top three most - traded bonds were 25 Bank of China Secondary Capital Bond 02BC, 25 Bank of China Secondary Capital Bond 03A(BC), and 25 China Construction Bank Secondary Capital Bond 03BC [2]. - In terms of the regions of issuers, the top three regions in terms of trading volume were Guangdong Province, Guizhou Province, and Heilongjiang Province, with trading volumes of approximately 131.6 billion yuan, 13 billion yuan, and 8.1 billion yuan respectively [2]. - As of March 27, the changes in the yields to maturity of 5Y secondary capital bonds with ratings of AAA -, AA +, and AA compared to last week were - 3.21BP, - 3.87BP, and - 3.87BP respectively; for 7Y secondary capital bonds, the changes were - 6.06BP for all three ratings; for 10Y secondary capital bonds, the changes for ratings of AAA -, AA +, and AA were - 4.25BP, - 4.24BP, and - 4.24BP respectively [2]. - This week, the overall deviation of the weekly average trading price valuation of secondary capital bonds was not large. The proportion of discount transactions was greater than that of premium transactions, and the discount amplitude was larger than the premium amplitude [3]. 3. Summary by Directory 3.1 Primary Market Issuance - This week (20260323 - 20260327), there were no new issuances of secondary capital bonds in the inter - bank and exchange markets [1]. 3.2 Secondary Market Trading - **Trading Volume**: The weekly trading volume of secondary capital bonds this week was approximately 177.9 billion yuan, a decrease of 10.5 billion yuan compared to last week. The top three most - traded bonds were 25 Bank of China Secondary Capital Bond 02BC (13.259 billion yuan), 25 Bank of China Secondary Capital Bond 03A(BC) (10.928 billion yuan), and 25 China Construction Bank Secondary Capital Bond 03BC (7.651 billion yuan) [2]. - **Regional Trading Volume**: In terms of the regions of issuers, the top three regions in terms of trading volume were Guangdong Province, Guizhou Province, and Heilongjiang Province, with trading volumes of approximately 131.6 billion yuan, 13 billion yuan, and 8.1 billion yuan respectively [2]. - **Yield to Maturity**: As of March 27, the changes in the yields to maturity of 5Y secondary capital bonds with ratings of AAA -, AA +, and AA compared to last week were - 3.21BP, - 3.87BP, and - 3.87BP respectively; for 7Y secondary capital bonds, the changes were - 6.06BP for all three ratings; for 10Y secondary capital bonds, the changes for ratings of AAA -, AA +, and AA were - 4.25BP, - 4.24BP, and - 4.24BP respectively [2]. 3.3 Valuation Deviation of the Top 30 Individual Bonds - **Discount Bonds**: The top two bonds with the highest discount rates were 24 Mintai Commercial Bank Secondary Capital Bond 01 (- 0.6931%) and 25 Mintai Commercial Bank Secondary Capital Bond 01 (- 0.6400%), and the discount rates of the rest were within - 0.50%. The ChinaBond implicit ratings were mainly AAA -, AA +, and AA -, and the bonds were mainly distributed in Beijing, Shanghai, and Guangdong [3]. - **Premium Bonds**: The top three bonds with the highest premium rates were 23 Mintai Commercial Bank Secondary Capital Bond 01 (0.2287%), 22 Xiamen Rural Commercial Secondary 01 (0.0991%), and 22 Ningbo Bank Secondary Capital Bond 01 (0.0701%), and the premium rates of the rest were within 0.07%. The ChinaBond implicit ratings were mainly AAA -, AA +, and AA, and the bonds were mainly distributed in Beijing, Shanghai, and Zhejiang [3].

Macro Strategy - The core viewpoint indicates that the current geopolitical tensions in the Middle East and hawkish signals from major central banks during the "Super Central Bank Week" have led to a significant rise in long-term government bond yields, putting pressure on gold and silver prices. The stronger hawkish stance from the Bank of England has strengthened the British pound and euro, while the US dollar index has shown relative weakness, leading to a phenomenon where both the dollar index and gold prices have declined simultaneously. This reflects that gold pricing is influenced not only by US real interest rate expectations but also by global real interest rate expectations [1][36]. Industry Analysis - The Chinese shipbuilding industry has achieved a transformation from "scale expansion" to "quality and quantity improvement," maintaining its position as a global leader in key metrics for 16 consecutive years. This industry is crucial for realizing the strategy of becoming a manufacturing and maritime power [2][37]. Investment Recommendations - Green Town Services (02869.HK) is expected to see steady growth in core profits, with projected net profits of 9.88 billion, 10.98 billion, and 11.90 billion yuan for 2026, 2027, and 2028 respectively, reflecting year-on-year growth rates of 12.2%, 11.2%, and 8.3%. The company maintains a "buy" rating due to its strong cash position and commitment to dividends [7]. - XPeng Motors (09868.HK) has adjusted its revenue forecasts for 2026 and 2027 to 96.2 billion and 126.5 billion yuan, respectively, with a projected net profit of -1.4 billion and 2.1 billion yuan. The company is maintaining a "buy" rating based on its AI capabilities and new model launches [8]. - Longking Environmental Protection (600388) has adjusted its 2026 net profit forecast down to 14.1 billion yuan but maintains a "buy" rating due to its dual-driven growth strategy in green energy and electric mining vehicles [9]. - Tuhu-W (09690.HK) is expected to see improvements in profitability driven by store expansion and product upgrades, with net profit forecasts adjusted to 7.1 billion and 9.5 billion yuan for 2026 and 2027, respectively, maintaining a "buy" rating [12]. - Li Ning (02331.HK) has raised its net profit forecasts for 2026 and 2027 to 30.6 billion and 33.0 billion yuan, respectively, maintaining a "buy" rating due to strong performance in professional categories and refined operations [16]. - Ningde Times (300750) maintains its net profit forecasts for 2026, 2027, and 2028 at 940 billion, 1168 billion, and 1428 billion yuan, respectively, with a "buy" rating based on its leading position in the global battery market [24].

Report Industry Investment Rating - Not provided in the report Core Viewpoints - This week (20260302 - 20260306), there were no new issuances of secondary capital bonds in the inter - bank and exchange markets [1] - The weekly trading volume of secondary capital bonds this week totaled approximately 211.4 billion yuan, an increase of 98.2 billion yuan from last week [2] - This week, the overall deviation of the weekly average trading price valuation of secondary capital bonds was not large, with the proportion and amplitude of discount transactions greater than those of premium transactions [3] Summary by Directory Primary Market Issuance - This week (20260302 - 20260306), there were no new issuances of secondary capital bonds in the inter - bank and exchange markets [1] Secondary Market Transactions - **Trading Volume**: The weekly trading volume of secondary capital bonds this week totaled approximately 211.4 billion yuan, an increase of 98.2 billion yuan from last week. The top three bonds in terms of trading volume were 25 Bank of China Secondary Capital Bond 03A(BC) (14.493 billion yuan), 25 Bank of China Secondary Capital Bond 02BC (11.006 billion yuan), and 25 Agricultural Bank of China Secondary Capital Bond 04A(BC) (8.16 billion yuan). By issuer region, the top three in trading volume were Guangdong Province (158.6 billion yuan), Guizhou Province (17.8 billion yuan), and Heilongjiang Province (8.7 billion yuan) [2] - **Yield to Maturity**: As of March 6, for 5Y secondary capital bonds, the yield - to - maturity changes compared to last week for ratings AAA -, AA +, and AA were - 1.82BP, - 2.57BP, and - 3.57BP respectively; for 7Y secondary capital bonds, they were - 1.15BP, - 1.16BP, and - 1.16BP respectively; for 10Y secondary capital bonds, they were - 1.16BP, - 1.83BP, and - 1.83BP respectively [2] Top Thirty Bonds by Valuation Deviation - **Discount Bonds**: The top three discount bonds were 25 Guangdong Huaxing Bank Secondary Capital Bond 01 (- 1.1331%), 24 Yinzhou Rural Commercial Bank Secondary Capital Bond 01 (- 0.9793%), and 21 Huishang Bank Secondary 01 (- 0.4872%). The Zhongzhai implicit ratings were mainly AAA -, AA -, and AA +, and the regional distribution was concentrated in Beijing, Shanghai, and Guangdong [3] - **Premium Bonds**: The top three premium bonds were 24 Lanzhou Bank Secondary Capital Bond 01 (0.1904%), 25 Chouzhou Commercial Bank Secondary Capital Bond (0.1844%), and 25 Shanghai Pufa Bank Secondary Capital Bond 01B (0.0859%). The Zhongzhai implicit ratings were mainly AAA -, AA, and AA +, and the regional distribution was concentrated in Beijing, Shanghai, and Shandong [3]

Summary of Key Points from the Conference Call Industry Overview - The focus is on the credit bond market in March 2026, characterized by a "strong supply, weak demand" scenario, with investment opportunities concentrated in short-term (1 year or less) and long-term (5 years or more) credit bonds, forming a "barbell" structure [1][2][3]. Core Insights and Arguments - **Short-term Credit Bonds**: The demand for 1-year and shorter credit bonds is supported by the upcoming maturity of amortized cost bond funds in March, which are expected to quickly rebuild their positions within 1-2 weeks after reopening, leading to a potential compression of spreads [1][4]. - **Long-term Credit Bonds**: Long-term credit bonds (5 years and above) benefit from seasonal allocations by insurance companies and the opening of amortized cost products, which enhances their preference for medium to long-term credit bonds [1][4]. - **Market Dynamics**: March typically sees a high supply of credit bonds, with historical data indicating that the issuance in March is often higher than in adjacent months. In March 2026, the repayment amount is approximately 1 trillion, with around 150 billion already issued [3][4]. - **Investment Strategy**: The recommendation is to focus on short-duration credit bonds while also extending to 5-10 year bonds for institutions with stable liabilities. The current yield levels are historically low, but there is still room for further spread compression [2][4]. Additional Important Insights - **Amortized Cost Bond Funds**: The share of credit bonds held indirectly through amortized cost bond funds has increased to 20%, indicating a shift in the holder structure towards wealth management products, which helps smooth net value fluctuations [1][5]. - **Investment Preferences**: The preference for credit bonds is shifting, with a notable increase in the allocation of funds towards amortized cost bond funds, which are now more favored by wealth management products compared to traditional bank holdings [5][6]. - **Market Behavior**: Historical data supports the conclusion that amortized cost bond funds can compress credit spreads due to their concentrated trading rhythm, particularly during the reopening phase [6][7]. - **Insurance Companies' Role**: Insurance companies typically increase their allocation to medium to long-term credit bonds in March, driven by seasonal patterns and the need to deploy premium income [13][14]. - **Impact of New Insurance Products**: The development of dividend insurance products in 2026 is expected to alter the allocation preferences of insurance funds, favoring higher-yielding assets like equity and long-term credit bonds over traditional long-term government bonds [14][15]. Conclusion - The March 2026 credit bond market presents structural opportunities primarily in short-term and long-term bonds, driven by the dynamics of amortized cost bond funds and insurance company allocations. The overall investment strategy should remain cautious yet opportunistic, focusing on the identified segments that are likely to benefit from the prevailing market conditions [1][15].

Macro Strategy - The core viewpoint indicates that the Q3 2025 US GDP grew at an annualized rate of +4.3%, significantly exceeding Bloomberg analysts' consensus expectation of +3.3% and the Atlanta Fed's GDPNow estimate of +3.5% [1][10] - The main contributions to this growth were strong consumer spending and a reduction in inventory drag, with inventory changes being the largest marginal contributor to the acceleration in GDP growth [1][10] - Despite the strong GDP data, the market initially reacted with concerns of economic overheating, leading to a temporary cooling of interest rate cut expectations, which later reversed as asset prices adjusted [1][11] Fixed Income - The 10-year government bond yield rose from 1.8425% to 1.835% during the week of December 15-19, 2025, reflecting a mixed sentiment in the bond market [2][12] - The issuance of green bonds totaled approximately 21.11 billion yuan, a decrease of 15.64 billion yuan from the previous week, while the secondary market saw a total transaction volume of 80.1 billion yuan, an increase of 15.7 billion yuan [4][17] - The issuance of secondary capital bonds amounted to 8.46 billion yuan, with a total transaction volume of approximately 273.9 billion yuan, a decrease of 55.3 billion yuan from the previous week [4][19] Industry Analysis - 康耐特光学 (Kangnate Optical) is a leading manufacturer of resin lenses in China, with a robust growth trajectory expected as the market for AI smart glasses expands [5][20] - The company is projected to achieve a compound annual growth rate (CAGR) of 17.2% in revenue and 35.2% in net profit from 2020 to 2024, driven by high-value products and automation improvements [5][21] - The smart glasses market is anticipated to create significant demand for high-refractive lenses, with 康耐特光学 positioned to benefit from this trend due to its technological advantages and partnerships with major tech companies [5][21]

Report Summary 1. Core Viewpoint Among AA-rated urban investment bonds with the highest discount rates, "25 Gaomi 01" had the largest deviation in valuation price; among the top 50 bonds with the largest net price declines, "24 SDIC MTN002" had the largest deviation; among the top 50 bonds with the largest net price increases, "23 Vanke MTN002" had the largest deviation; among the top 50 Tier 2 and perpetual bonds with the largest net price increases, "25 ABC Tier 2 Capital Bond 01B(BC)" had the largest deviation [2]. 2. Summary by Directory Discount - Leading AA Urban Investment Bonds (Subject Rating) - The report listed 40 AA-rated urban investment bonds with high discount rates, including "25 Gaomi 01" with a 4.27-year remaining term, a valuation price deviation of -0.28%, a valuation net price of 105.07 yuan, and a valuation yield of 3.93% [4]. Top 50 Bonds with the Largest Net Price Declines - The report presented 50 bonds with significant net price drops, such as "24 SDIC MTN002" with a 28.76-year remaining term, a valuation price deviation of -0.40%, a valuation net price of 98.10 yuan, and a valuation yield of 2.58% [6]. Top 50 Bonds with the Largest Net Price Increases - It included 50 bonds experiencing substantial net price increases. For example, "23 Vanke MTN002" had a 0.42-year remaining term, a valuation price deviation of 2.30%, a valuation net price of 16.85 yuan, and a valuation yield of 1067.74% [9]. Top 50 Tier 2 and Perpetual Bonds with the Largest Net Price Increases - The report listed 50 Tier 2 and perpetual bonds with large net price increases, like "25 ABC Tier 2 Capital Bond 01B(BC)" with a 9.53-year remaining term, a valuation price deviation of 0.29%, a valuation net price of 96.65 yuan, and a valuation yield of 2.50% [13].

Group 1 - Agricultural Bank issued 60 billion yuan in subordinated capital bonds in the interbank market [1] - The bonds consist of 40 billion yuan with a "5+5" year term at an interest rate of 1.92% and 20 billion yuan with a "10+5" year term at an interest rate of 2.12% [1] - The issuance includes a mechanism for additional issuance, allowing for a total of 30 billion yuan in additional bonds to enhance the bank's capital strength [1] Group 2 - The bond issuance attracted a wide range of investors, with over 80% of bidders for the "10+5" year bonds being market-oriented institutions such as securities, funds, trusts, futures, and monetary intermediaries [1]

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the bond market dynamics in May 2025, focusing on the impact of trade wars, currency tariffs, and monetary policy on the bond market [1][3][4]. Core Insights and Arguments - **Market Recovery**: The bond market is showing signs of recovery with rising yields across various bonds, particularly after the May Day holiday. There are opportunities for credit bonds to catch up as their yields are declining similarly to interest rates [2][13]. - **Monetary Policy Outlook**: The outlook for future monetary policy is optimistic, with expectations for a reserve requirement ratio (RRR) cut. However, the timing for interest rate cuts remains uncertain. The current strategy should be cautious, focusing on the short end of the yield curve if it continues to decline [1][4][8]. - **Liquidity Trends**: Liquidity is stabilizing, with a notable decrease in the central price of funds since early April. The net issuance of government bonds in May is expected to be historically high, contributing to balanced liquidity [1][9][11]. - **Impact of Policy Measures**: The combination of broad fiscal measures and RRR cuts is expected to influence the bond market positively. However, the lack of clear interest rate cut expectations limits the pricing impact of RRR cuts [5][6][10]. - **Credit Bond Market**: There is a cautious but positive outlook for the credit bond market, with potential for a rebound in yields. The market is expected to see some recovery, particularly in medium-duration credit strategies [12][22]. Additional Important Content - **Market Dynamics**: The bond market is facing challenges in breaking out of its current stagnation, with previous pricing already reflecting some positive factors. The lack of clear interest rate cut expectations makes it difficult to generate new pricing increments [6][10]. - **Investment Strategies**: In the current market environment, medium-duration strategies (3-4 years) are favored due to better yield protection and compression potential. The performance of secondary capital bonds has been strong, indicating a recovery in liquidity [16][15]. - **Long-term Bonds**: The performance of ultra-long bonds has been mixed, with some signs of recovery but still facing pressure from yield curve dynamics. The absolute yield levels are at historical lows, indicating limited room for significant declines [14][19]. - **Future Meetings**: Upcoming meetings of financial regulatory bodies are expected to discuss the implementation of counter-cyclical policies, including potential RRR cuts and structural monetary policy adjustments [10]. This summary encapsulates the key points discussed in the conference call, providing insights into the bond market's current state and future outlook.