Investment Rating - The report maintains a "Positive" investment rating for the real estate industry [9] Core Insights - The real estate industry continues to show weak fundamentals, with significant year-on-year declines in sales and construction activities. The central economic work conference emphasizes "controlling increments, reducing inventory, and optimizing supply," indicating that policy thresholds are approaching, which may open up policy windows for intervention [2][12] - In November 2025, the sales volume and area of commercial housing decreased by 25.1% and 17.3% year-on-year, respectively, reflecting ongoing pressure from high bases and declining market sentiment. The report anticipates that December will also face significant year-on-year pressure [12][12] - The report highlights the importance of focusing on quality real estate companies with low inventory, strong regional presence, and product strength, as well as stable cash flow from leading brokerage firms, commercial real estate, and state-owned property management companies [2][12] Summary by Sections Sales Performance - In the first eleven months of 2025, the national commercial housing sales amount and area decreased by 11.1% and 7.8% year-on-year, respectively. November saw a more pronounced decline, with sales amount and area down by 25.1% and 17.3% [12][12] - The average sales price of new homes in November was 9,097 yuan per square meter, down 9.5% year-on-year, while the average price of residential properties fell by 11.1% [12][12] Construction Activity - New construction area in the first eleven months of 2025 decreased by 20.5% year-on-year, with November's decline at 27.6%. The report suggests that the construction sector may have entered an oversold state [12][12] - The completed construction area also saw a decline of 18.0% year-on-year, with November's figure down 25.5% [12][12] Investment Trends - The total funds available to real estate companies decreased by 11.9% year-on-year, with November seeing a sharp decline of 32.5%. This includes a 10.4% drop in domestic loans and a 30.7% decrease in self-raised funds [12][12] - Real estate development investment completed in the first eleven months of 2025 fell by 15.9% year-on-year, with November's investment down 30.3% [12][12] Market Outlook - The report forecasts that the real estate industry will remain in an adjustment phase throughout 2025, with an expected annual sales decline of around 10% and construction activity down by approximately 20% [12][12]

Group 1 - The Shanghai Composite Index is expected to break through the previous high of 3674 in the third quarter, with current fluctuations nurturing new momentum [2][3] - External disturbances have limited impact on A-shares, and any short-term sharp declines may provide opportunities for rate-sensitive investments [3] - The semiconductor industry is in an upward cycle, with AI being the primary growth driver, supported by strong cloud AI demand and accelerating terminal AI applications [4] Group 2 - The current A-share market is driven by capital, with a clear policy bottom, and leveraged funds are boosting trading volume [5] - The transition between old and new growth drivers remains the main theme, with some industries showing signs of profit improvement [5] - The disturbances in August are not the end but rather a buildup for the policy window in September, with expectations of emotional stabilization and recovery [7]

Market Overview - The Hong Kong stock market opened positively on May 2, with all three major indices closing higher. The Hang Seng Index rose by 1.74% to 22,504.68 points, the Hang Seng Tech Index increased by 3.08% to 5,244.06 points, and the Hang Seng China Enterprises Index gained 1.92% to 8,231.04 points [3]. Economic Context - The Chinese Ministry of Commerce noted ongoing discussions with the U.S. regarding tariff negotiations, indicating a willingness from the U.S. side to engage in talks [3]. - According to Everbright Securities, the Hong Kong stock market is currently in a phase of "valuation trough" and "policy window," with the Hang Seng Index approximately 12% below its ten-year valuation mean and the Hang Seng Tech Index's price-to-earnings ratio at a historical low of 8% [3]. Sector Performance - The technology sector saw a broad increase, with notable gains from companies such as Xiaomi (up over 6%), Alibaba and JD.com (both up over 3%), and Tencent, Meituan, and Kuaishou also closing higher [5]. - The new energy vehicle (NEV) sector experienced significant growth, driven by strong delivery numbers for April. Companies like Li Auto, Xpeng, and Leap Motor reported year-on-year delivery increases of 31.6%, 273%, and 173%, respectively [8]. Company Highlights - WuXi Biologics reported a revenue of approximately 9.655 billion yuan for Q1 2025, a year-on-year increase of 20.96%, with a net profit of about 3.672 billion yuan, up 89.06% [8]. - The new tea beverage sector also performed well, with Nayuki's Tea rising over 8% amid ongoing public offerings [9]. Stock Movements - Meilan Airport's stock surged by 7.71% following the announcement of a major share transfer, with the controlling shareholder transferring 50.19% of the company’s shares for a total of 2.52 billion HKD [14].