Core Insights - The report emphasizes the importance of monitoring the U.S. government shutdown and its impact on economic data and market sentiment, alongside the upcoming 20th Central Committee meeting in China, which will focus on the "14th Five-Year Plan" [4][2] - The market is expected to continue a trend of oscillating upward, supported by positive domestic PMI data and expectations surrounding the "14th Five-Year Plan" [4][2] - The report highlights a potential increase in foreign capital inflows in the fourth quarter, which could support the A-share market [4][2] - The core investment direction is likely to remain focused on technology assets in the near term [4][2] October Stock Picks - The October stock picks include: - China Southern Airlines (Transportation) - COSCO Shipping Specialized Carriers (Transportation) - Tongkun Co., Ltd. (Chemicals) - Yake Technology (Chemicals) - CATL (Electric New Energy) - Lingnan Holdings (Social Services) - Jinghe Integrated (Electronics) - Shenzhen South Circuit (Electronics) - GoerTek (Electronics) - Jieshun Technology (Computers) [9][10] September Performance Review - The September stock portfolio outperformed the market, with notable monthly returns exceeding 30% for CATL and Zhaoyi Innovation, and an absolute return of 4.64%, outperforming the market benchmark by 1.44 percentage points [5][6] Transportation Sector: China Southern Airlines - China Southern Airlines is a leading airline service provider with a significant market share and a robust hub network centered in Guangzhou and Beijing. The company is expected to achieve a revenue of 174.22 billion yuan in 2024, reflecting an 8.94% year-on-year growth [11][12] - The airline industry in China has seen a 172.8% growth in passenger transport over the past 15 years, with a projected domestic passenger transport volume of 730 million in 2024, a 17.86% increase [12][13] Transportation Sector: COSCO Shipping Specialized Carriers - The company reported a 44.05% year-on-year increase in revenue for the first half of 2025, reaching 10.775 billion yuan, with a net profit of 825 million yuan, marking a 13.08% increase [14][15] - The demand for specialized vessels remains strong, particularly in the automotive shipping segment, which saw a 439.87% increase in revenue [15][16] Chemicals Sector: Tongkun Co., Ltd. - The company experienced an 8.41% year-on-year decrease in revenue for the first half of 2025, totaling 44.158 billion yuan, with a notable decline in polyester filament prices due to fluctuating oil prices [16][17] - The gross profit margin improved to 6.76%, reflecting a 0.57 percentage point increase year-on-year [17][18] Chemicals Sector: Yake Technology - The company reported steady revenue growth driven by LNG and electronic materials, with a gross profit margin of 31.82% in the first half of 2025 [19][20] - The electronic materials segment saw a 15.37% year-on-year revenue increase, with significant contributions from semiconductor chemical materials [20][21] New Energy Sector: CATL - CATL is projected to achieve a net profit of 50.745 billion yuan in 2024, a 15.01% increase year-on-year, with a total revenue of 362.013 billion yuan [23][24] - The company maintains a leading position in the global battery market, with a 37.9% market share in 2024 [24][25] Social Services Sector: Lingnan Holdings - The company reported an 8.52% year-on-year increase in revenue for the first half of 2025, totaling 2.09 billion yuan, with a net profit of 50 million yuan, reflecting a 24.39% increase [26][27] - The opening of a city duty-free store is expected to enhance customer flow and boost related tourism industry growth [27][28] Electronics Sector: Jinghe Integrated - The company achieved a 28% year-on-year revenue increase in 2024, totaling 9.249 billion yuan, with a net profit of 533 million yuan, marking a 152% increase [29][30] - The company is focusing on optimizing product structure and upgrading technology processes to maintain competitive advantages [30][31] Electronics Sector: Shenzhen South Circuit - The company reported a 25.63% year-on-year revenue increase in the first half of 2025, reaching 10.453 billion yuan, with a net profit of 1.36 billion yuan [32][33] - The PCB business saw a 29.21% year-on-year increase in revenue, driven by demand in communication and data center sectors [33][34]

Group 1: Strategy Overview - The core strategy is a continuation of the bull market, focusing on core technology assets as A-shares strengthen under the leadership of these assets [2][3] - The market outlook remains positive due to economic recovery expectations, continuous capital inflow, and policy benefits, with a mid-term slow bull logic still intact [3] - Short-term market may face technical adjustment pressure due to crowded trading in some popular sectors, but a new round of valuation-driven market space is expected to open up starting in Q3 [3] Group 2: September Stock Picks - The September stock picks include: Beijing-Shanghai High-Speed Railway (Transportation), Tongkun Co., Ltd. (Chemicals), Yake Technology (Chemicals), CATL (Electricity), Heng Rui Medicine (Pharmaceuticals), Sanyou Medical (Pharmaceuticals), Beijing Renli (Social Services), Feiliwa (Electronics), Zhaoyi Innovation (Electronics), and Pengding Holdings (Electronics) [8][10] Group 3: Industry Insights Transportation Industry: Beijing-Shanghai High-Speed Railway - The company is a landmark project in China's high-speed rail, with expected net profit exceeding 12.7 billion yuan in 2024 [10] - The business model relies on entrusted transportation management, with revenue primarily from passenger transport and network service income [10] - Key factors supporting growth include a favorable pricing mechanism, strong travel demand along the route, network effects from an expanding high-speed rail network, and technological advancements in train efficiency [11] Chemical Industry: Tongkun Co., Ltd. - The company achieved significant sales growth in polyester filament, with a total sales volume of 9.4587 million tons in the first three quarters of 2024, a year-on-year increase of 29.60% [12] - Despite a decline in selling prices due to fluctuating oil prices and weak downstream demand, the company expects profitability to improve with demand recovery [12] Chemical Industry: Yake Technology - The company reported steady growth, with a gross margin of 31.59% in 2024 [14] - The electronic materials segment is expanding, with significant revenue growth in precursor materials and photoresists [15] Electric Industry: CATL - The company achieved a net profit of 50.745 billion yuan in 2024, a year-on-year increase of 15.01% [17] - CATL maintains a leading position in the global battery market, with a 37.9% market share in power batteries and 36.5% in energy storage [18] Pharmaceutical Industry: Heng Rui Medicine - The company reported a 12.53% year-on-year increase in revenue for Q2 2024, with innovative drugs accounting for over 60% of total revenue [20] - Multiple new products were launched in the first half of 2024, contributing to growth [21] Pharmaceutical Industry: Sanyou Medical - The company faced pressure from centralized procurement but is innovating therapies to enhance market share [24] - The acquisition of Waterwood Tianpeng is expected to strengthen the product matrix and enhance competitiveness [25] Social Services Industry: Beijing Renli - The company has a broad service coverage and a strong client base, with growth potential in flexible employment and outsourcing [27] - Digitalization and AI applications are expected to enhance operational efficiency and revenue growth [28] Electronics Industry: Feiliwa - The company reported a revenue of 908 million yuan in H1 2025, with a gross margin of 49.2% [29] - New business lines are beginning to contribute to performance, particularly in semiconductor and aerospace sectors [30] Electronics Industry: Zhaoyi Innovation - The company achieved a revenue of 7.356 billion yuan in 2024, with a significant increase in net profit [32] - The company is actively expanding its market share in various sectors, including storage and MCU products [33] Electronics Industry: Pengding Holdings - The company reported a revenue of 16.375 billion yuan in H1 2025, with a net profit increase of 57.22% [35] - The company is capitalizing on market opportunities across various product lines, including communication and consumer electronics [36]