Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **Chinese equity market** and the positioning of **foreign institutional investors** in Chinese equities during **3Q25**. Core Insights and Arguments 1. **Increased Foreign Investment**: International investors increased their positions in Chinese equities, reducing their underweight from **-1.6% to -1.3%** during the quarter, marking the least underweight since **4Q22** [2][3] 2. **Sector Preferences**: The most significant additions by international investors were in the **healthcare, insurance, energy & materials, and internet sectors**, while positions in **auto and tech** were reduced [2][5] 3. **Stock Connect Activity**: Southbound inflows reached **US$56 billion**, matching the record level from **1Q25**, with net inflows across all sectors. The top sectors for southbound investment included **consumer discretionary, financials, and healthcare** [2][4] 4. **Northbound Outflows**: In contrast, northbound investments saw a net outflow of **US$18 billion** in **3Q25**, with significant sell-offs in **financials, staples, and utilities** [4][5] 5. **Active Fund Dynamics**: Approximately **800 active foreign funds** hold **US$270 billion** in Chinese stocks, with **145 funds** (AUM **US$212 billion**) not holding any Chinese equities as of **3Q25**, down from **167 funds** in **2Q25** [3][9] 6. **Crowding Observations**: Active foreign institutional investors favored growth sectors like **healthcare, insurance, and internet**, while selling off auto and tech stocks. The **crowding score** for sectors like **renewables and defensives** increased, while **banks, healthcare, and internet** saw declines [5][39] Additional Important Insights 1. **Top Bought Stocks**: Notable stocks with significant foreign inflows included **Alibaba Health Information Technology Ltd.** (7.5% increase), **Bilibili, Inc.** (4.7%), and **Zhongan Online P&C Insurance Co.** (4.3%) [17] 2. **Top Sold Stocks**: Stocks with the most significant outflows included **China Mengniu Dairy** (-2.0%), **Agile Group Holdings** (-2.1%), and **BYD Company** (-4.4%) [18] 3. **Risks Identified**: Potential risks for Chinese equities include a hard landing in the property market, capital outflows due to currency depreciation, and slow structural reforms. Inadequate government policies could exacerbate these risks [48] 4. **Valuation Methods**: Various valuation approaches are employed, including DCF models, Gordon growth model analysis, and relative valuation using multiples like PE, EV/EBITDA, and P/BV [47] This summary encapsulates the key points from the conference call, highlighting the dynamics of foreign investment in the Chinese equity market, sector preferences, and potential risks facing the market.

Group 1 - The A-share market has significantly rebounded since the third quarter, with active trading and foreign capital continuing to buy aggressively [1][2] - Leading companies such as Kweichow Moutai, Ping An Insurance, and Wuliangye have attracted over 80 foreign institutional investors each, indicating strong foreign interest in industry leaders [1][2] - As of the end of September, the top three foreign-held A-shares by market value are CATL, Kweichow Moutai, and Midea Group, with values of 265.66 billion, 88.14 billion, and 71.65 billion respectively [1][2] Group 2 - Foreign investment is particularly focused on industry leaders, "Chinese state-owned enterprises," and bank stocks, with major banks holding significant foreign shares [2][3] - As of September 30, 2023, 32 foreign investors collectively held 2.36 billion shares of Nanjing Bank, while 42 foreign investors held 1.60 billion shares of Ningbo Bank [2] - A total of 42 A-shares have foreign holdings exceeding 10 billion, including Zijin Mining, Hengrui Medicine, BYD, and Fuyao Glass [2] Group 3 - The number of foreign investors in China Shipbuilding has increased by over 40% from the end of June, reaching 68 by the end of September [3] - Other companies such as Kweichow Moutai, BYD, and Yangtze Power have also seen an increase in foreign holdings compared to the end of June [3] Group 4 - Foreign investors have shown a preference for specific stocks, with UBS significantly increasing its stake in RuiNeng Technology, becoming the third-largest shareholder by the end of September [4][5] - UBS held 1.15 million shares of RuiNeng Technology, a 130.2% increase from the previous quarter, while Goldman Sachs, JPMorgan, and Merrill Lynch entered the top ten shareholders [5] Group 5 - RuiNeng Technology's stock has seen a significant rise, reaching a peak of 24.43 yuan, with a cumulative increase of over 40% since mid-October [7] - Despite a 12.95% year-on-year revenue growth, RuiNeng Technology's net profit decreased by 32.73% to 40.75 million [7] Group 6 - Foreign investors are optimistic about the long-term performance of the A-share market, with UBS forecasting a 6% year-on-year growth in total A-share earnings by 2025 [8] - UBS noted that 60% of industries recorded year-on-year profit growth in the third quarter, with sectors like non-ferrous metals and non-bank financials achieving over 30% growth [8] Group 7 - Goldman Sachs predicts a sustained upward trend in the Chinese stock market, expecting major indices to rise by about 30% by the end of 2027 [9] - Factors supporting this bullish outlook include favorable policy developments, accelerating earnings growth, and strong capital inflows [9] Group 8 - As the bull market unfolds, Goldman Sachs advises investors to shift their strategy from "selling on highs" to "buying on lows" [10]

Core Viewpoint - Xianghe Industrial (603500.SH) reported its Q3 2025 results, highlighting a total institutional ownership of 12.1264 million shares, representing 3.64% of the company's total equity, with an increase in institutional holding by 0.33 percentage points compared to the previous quarter [1] Institutional Investors - As of October 30, 2025, six institutional investors disclosed their holdings in Xianghe Industrial, with a combined shareholding of 12.1264 million shares [1] - The institutional investors include Tian Tai Xiang He Investment Center (Limited Partnership), China Construction Bank - Wan Jia New Opportunities Leading Enterprises Flexible Allocation Mixed Securities Investment Fund, and others, collectively holding 3.64% of the total shares [1] - The institutional holding ratio increased by 0.33 percentage points compared to the last quarter [1] Public Funds - One public fund, Jin Ying Min Feng Return Mixed Fund, reduced its holdings compared to the previous quarter, showing a slight decline [1] - Four new public funds disclosed their holdings this quarter, including Wan Jia New Opportunities Leading Enterprises Mixed A and Wan Jia Domestic Demand Growth One-Year Holding Period Mixed Fund [1] - A total of 54 public funds were not disclosed this quarter, including various index-enhanced funds [1] Foreign Investment - One foreign institution, Goldman Sachs International - Proprietary Funds, was not disclosed in this quarter compared to the previous one [2]

Group 1 - JinkoSolar (688223.SH) reported its Q3 2025 results, with 26 institutional investors holding a total of 7.26 billion shares, accounting for 72.56% of the total share capital [1] - The top ten institutional investors collectively hold 71.88% of the shares, a decrease of 5.81 percentage points compared to the previous quarter [1] Group 2 - In the public fund sector, five funds increased their holdings, while two funds decreased their holdings by 0.97% compared to the previous quarter [2] - Nine new public funds were disclosed this period, while 419 funds were not disclosed compared to the previous quarter [2] - Foreign investment sentiment showed a decrease in holdings from two foreign funds, accounting for a reduction of 4.32% [2]

Group 1 - The core viewpoint of the news is that TuoBang Co., Ltd. (002139.SZ) reported a decrease in institutional holdings in its third-quarter report for 2025, with a total of 8 institutional investors holding 87.4651 million shares, representing 7.01% of the total share capital, a decline of 0.88 percentage points from the previous quarter [1] Group 2 - In the public fund sector, there were 4 public funds that increased their holdings compared to the previous period, with a total increase of 0.73% [2] - There were 2 public funds that reduced their holdings, showing a slight decline [2] - A total of 236 public funds did not disclose their holdings this period, including several notable funds [2] - In terms of foreign investment, there was 1 foreign fund that increased its holdings, accounting for an increase of 0.20% [2]

Core Insights - The article discusses the latest foreign investment trends in the ETF market, highlighting which companies have seen increased holdings by foreign investors [2] Group 1: Foreign Investment Trends - Recent data indicates a significant increase in foreign holdings in specific companies, suggesting a positive outlook for these firms [2] - The article identifies key sectors that are attracting foreign capital, emphasizing the importance of these sectors in the current market environment [2] Group 2: Company-Specific Insights - Several companies have been highlighted for their increased foreign investment, with specific figures detailing the percentage increase in foreign ownership [2] - The article provides a comparative analysis of companies that have gained foreign interest versus those that have not, illustrating the shifting dynamics in investor preferences [2]

Group 1 - QFI (Qualified Foreign Institutional Investors) has been actively involved in the A-share market, with 263 companies having QFI listed among their top ten shareholders as of the end of Q2 [1][2][3] - Notable companies with significant foreign holdings include Shengyi Technology, China XD Electric, and Oriental Yuhong, with foreign ownership exceeding 10 million shares in 34 stocks [1][3] - Major foreign institutions such as Barclays, UBS, and Goldman Sachs have increased their positions in several A-shares, indicating a strong interest in the market [2][4] Group 2 - Foreign institutional research activity remains high, with a total of 5,644 A-share company investigations conducted by foreign entities this year, covering 4,695 stocks [5][6] - Point72 Asset Management leads in research frequency, conducting 157 investigations, focusing on companies like Xiaogoods City, Huali Group, and Optoelectronics [5][6] - Companies such as Huichuan Technology and Mindray Medical have attracted significant foreign interest, with 525 and 299 foreign institutional investigations respectively [6] Group 3 - Morgan Stanley Fund expresses optimism in three key investment areas: technology growth sectors like AI and semiconductors, high-quality enterprises in Chinese manufacturing, and new consumer sectors with strong domestic and overseas performance [6]