Investment Rating - The industry rating is "Outperform the Market" indicating that the overall return of the industry is expected to exceed the market benchmark index by more than 5% in the next 6 months [80]. Core Insights - Jianghuai Automobile and Huawei have deepened their strategic partnership, focusing on the integration of Huawei's intelligent automotive solutions into Jianghuai's vehicle platforms, enhancing AI applications across various operational scenarios [3][13]. - The first flagship luxury electric sedan, the Zun Jie S800, has commenced mass production, with significant pre-order success, indicating strong market demand [4][15]. - The automotive sector has experienced a decline of 2.6% from June 16 to June 20, 2025, underperforming the CSI 300 index by 2.1 percentage points, although it ranks 4th among 31 sectors year-to-date with a 5.1% increase [16][23]. Summary by Sections Strategic Cooperation - Jianghuai and Huawei signed a strategic cooperation agreement on June 17, 2025, to enhance the application of intelligent automotive solutions, including AI-driven features and clean energy initiatives [3][13]. - The Zun Jie S800 project, a result of this collaboration, has a dedicated team of over 5,000 and a newly built factory equipped with advanced automation technology [4][14]. Market Performance - The automotive sector's performance from June 16 to June 20, 2025, showed a decline of 2.6%, while the CSI 300 index fell by only 0.5%, highlighting the sector's underperformance [16]. - Year-to-date, the automotive sector has increased by 5.1%, ranking 4th among all sectors [16]. Sales Data - From June 1 to June 15, 2025, retail sales of passenger vehicles reached 706,000 units, a 20% increase year-on-year, while wholesale sales were 714,000 units, up 24% year-on-year [6][36]. - New energy vehicle retail sales during the same period were 402,000 units, reflecting a 38% year-on-year growth [6][36]. Production and Delivery Plans - The Zun Jie S800 is set for initial deliveries on June 26, 2025, with plans for mass production to reach 3,000 units per month by September and 4,000 units by year-end [4][15].

Investment Rating - The report maintains an "A" rating for the new materials industry, indicating a positive outlook for the sector [1]. Core Insights - The chemical raw materials sector is currently experiencing a bottoming phase, with a slowdown in capacity expansion and a potential alleviation of intense competition and price wars. The overall profit margin for the industry is expected to remain between 3% and 5% in 2024, which is at a historical low. However, with the central economic work conference emphasizing the need to address "involution" competition, there is potential for improved industry order and profit recovery [1][34]. Summary by Sections 1. Market Performance and Valuation - The new materials index has shown significant volatility, underperforming the Shanghai Composite Index by 10.6% as of December 27, 2024. The index's performance was particularly weak in the first three quarters of 2024 but saw a recovery in the fourth quarter due to favorable policies [15][20]. 2. Focus Areas 2.1 Supply and Demand Dynamics - The vitamin sector is expected to maintain high prices for Vitamin E due to limited supply recovery from BASF's production facilities, which are aging and unable to meet demand. The report suggests monitoring companies like New Hope Liuhe and Zhejiang Medicine [42][59]. - The renewable energy materials sector is projected to benefit from a stable increase in wind power demand, with a significant rise in installed capacity and a self-regulatory agreement among wind turbine manufacturers to mitigate price competition. Companies like Times New Material and Mega Chip Color are highlighted for investment [44][60]. 2.2 Emerging Industry Opportunities - The bio-manufacturing sector is positioned for growth, particularly in synthetic biology and sustainable aviation fuel (SAF). The report emphasizes the importance of product selection and platform capabilities for companies in this space, recommending firms like Huaheng Biological and Meihua Biological [48][50]. - The special coatings market is expected to grow due to increasing military expenditures and the need for stealth materials. Companies such as Huaqin Technology and Jiachih Technology are noted for their potential in this area [52][61]. - The semiconductor materials sector is anticipated to benefit from the recovery of consumer electronics and AI applications, with a focus on domestic production capabilities. Companies like Stik and Aisen are recommended for investment [56][61]. - The humanoid robotics market is projected to drive demand for PEEK materials, with domestic companies expected to gain market share due to cost advantages. The report suggests monitoring firms like Zhongxin Fluorine Materials and Zhongyan Co. [58][61].