Macro Strategy - The report suggests that despite expectations of a slowdown in marginal fiscal funding for 2026, fiscal spending may still exceed expectations due to two main factors: a rebound in prices leading to increased fiscal revenue and a significant amount of fiscal "surplus" carried over from 2025. Specifically, a 1.8 percentage point increase in PPI could generate approximately 260 billion yuan in additional tax revenue, equivalent to a 0.2 percentage point increase in the deficit ratio. Additionally, the fiscal surplus may exceed 500 billion yuan, potentially enhancing the growth rate of general public budget expenditure by about 2.6 percentage points [1][19]. Industry Insights Electronic Industry - The report highlights that the domestic computing power industry is expected to experience significant growth, particularly in 2026, with domestic computing chip leaders likely entering a performance realization phase. The demand for domestic GPUs is anticipated to benefit from capacity releases due to advanced process expansions. The competition among domestic computing chip participants for market share is expected to drive the importance of AI ASIC service providers within the supply chain. Key recommendations include companies like Cambricon and Shengke Communication [9]. 3D DRAM - The report indicates that 2026 will be a pivotal year for 3D DRAM, driven by the rapid increase in storage demand from AI hardware deployment. The technology is expected to support various applications, including robotics, AIoT, and automotive sectors. The report recommends companies such as GigaDevice and Beijing Junzheng as key players in this space [10]. Insurance Industry - The insurance sector is projected to see improvements in both liabilities and assets, with significant upward valuation potential. The demand for insurance remains strong, and the shift towards dividend insurance is expected to optimize liability costs. The report notes that the current valuation of the insurance sector is at historical lows, suggesting a "buy" rating for the industry [12]. Environmental Industry - The report emphasizes the value of the waste incineration sector, driven by declining capital expenditures and improving operating cash flows. The acceleration of national subsidies is expected to enhance cash flow, with projections indicating that the sector's dividend potential could increase significantly as capital expenditures normalize [16]. Computer Industry - The report discusses the intersection of state-owned enterprise reform and local revenue enhancement, predicting that 2026 will see intensified management of local state-owned enterprises, leading to accelerated capital operations [13][14]. Space Computing - The report identifies the space computing industry as a rapidly evolving field, crucial for addressing global computing resource bottlenecks. It highlights the strategic importance of this sector and recommends focusing on companies with technological advantages in key areas [15]. Green Bonds - The report tracks the issuance of green bonds, noting an increase in issuance and a decrease in trading volume in the secondary market. This reflects the growing interest in sustainable finance and the potential for investment opportunities in this area [4][8]. Capital Market Trends - The report outlines trends in the capital markets, including the performance of various commodities and the impact of macroeconomic factors on pricing. It notes that the copper market is experiencing upward pressure due to supply constraints and demand fluctuations, while aluminum prices are also on the rise due to production capacity increases [11]. AI and Technology - The report forecasts that 2026 will mark the beginning of a new era for AI terminals, with major tech companies expected to launch innovative products. The integration of AI into consumer electronics is anticipated to create new market opportunities [9][18].

Investment Rating - The report maintains a rating of "Buy" for the electronic industry [1] Core Insights - The electronic industry is expected to experience significant growth driven by advancements in AI technology and the domestic supply chain's maturation, particularly in cloud and edge computing [11][15] - The report highlights the importance of 3D DRAM as a key hardware innovation for AI applications, with expectations for substantial demand growth in 2026 [22][27] - The shift towards high-density interconnects and advanced power supply architectures is crucial for supporting the increasing power density of AI data centers [50][56] Summary by Sections Cloud Computing Power - The domestic computing power supply chain is accelerating, with significant performance releases expected from local manufacturers like Zhongke Shuguang and Huawei [11] - The transition from Scale-Out to Scale-Up networking is enhancing bandwidth and reducing latency, which is critical for AI applications [11] Edge Computing Power - The integration of edge and cloud computing is becoming essential for AI applications, with edge devices benefiting from advancements in SoC technology [15][17] - Companies like Jingchen and Ruixinwei are positioned to capitalize on the growing demand for edge AI solutions [19] 3D DRAM - 3D DRAM is anticipated to become mainstream in 2026, driven by its high bandwidth and low cost, making it essential for various AI applications [22][27] - Companies such as Zhaoyi Innovation are expected to lead in the development of 3D DRAM technologies [28] AI Models - The optimization of AI models is crucial for enhancing performance and user experience, with a focus on local processing capabilities [29][30] - The collaboration between terminal manufacturers and model providers is expected to evolve, shaping the competitive landscape [30][33] AI Terminals - 2026 marks the beginning of a new era for AI terminals, with major companies like Meta, Apple, and Google launching innovative products [34][36] - The development of new terminal forms, such as smart glasses and desktop robots, is expected to drive market growth [34][35] Longxin Chain - Longxin's expansion plans are set to enhance the DRAM supply chain, with a focus on 3D architecture to improve performance and efficiency [38][39] - The company is expected to benefit from increased capital investment and technological advancements [39][41] Wafer Foundry - The domestic wafer foundry industry is entering a new expansion phase, particularly in advanced logic processes [42][43] - Key players like SMIC and Huahong are expected to lead this expansion, addressing the growing demand for advanced chips [44] PCB Industry - The PCB market is poised for growth, driven by the demand for high-performance materials and advanced designs [45][48] - Companies like Shenghong Technology are expected to benefit from the rising demand for AI-related PCB applications [49] Optical-Copper Interconnection - The demand for optical and copper interconnections is increasing, driven by the growth of AI computing clusters [50][52] - Companies such as Changguang Huaxin are well-positioned to capitalize on this trend [53] Server Power Supply - The shift to HVDC power supply architectures is becoming essential for AI data centers, addressing the challenges of increasing power density [55][56] - Companies like Oulu Tong are expected to lead in the development of advanced power supply solutions [56]

Group 1 - ByteDance and ZTE have launched an AI phone priced at 3499 yuan, featuring ByteDance's self-developed large model Agent service [1][21] - The phone integrates the Doubao mobile assistant technology, developed in collaboration with phone manufacturers at the operating system level [1][21] - ByteDance's primary focus is not on the AI phone itself but on the underlying AIOS software ecosystem [1][21] Group 2 - A new company named Zhiyue Qianli, established in August 2023, is gaining attention for its focus on AIOS [2][8] - Zhiyue Qianli is closely related to the Geely group, with key figures like Guo Jianguo involved in its establishment and management [3][22] - The company aims to reshape human-computer interaction and build an ecosystem for the AI terminal era [26][30] Group 3 - Zhiyue Qianli plans to develop both AI models and hardware products, including phones and XR glasses, distinguishing its strategy from ByteDance's [9][25] - The company has rapidly grown to nearly 200 employees within its first month, attracting talent from major tech firms like Huawei and Xiaomi [14][30] - The focus on AI terminals is expanding beyond traditional devices, potentially integrating into smart vehicles as central systems for human-machine collaboration [20][35] Group 4 - The concept of AI terminals is evolving, encompassing not just hardware but also software and new interaction models, breaking existing product definitions and competition logic [16][32] - Consumer-grade AI terminals are forming intelligent closed loops, with AI phones, PCs, and tablets becoming key entry points for connecting model capabilities with daily life [17][33] - The integration of AI terminals with smart cockpit technology is becoming a consensus in the automotive industry, aligning with strategies from major players like Huawei and Xiaomi [20][36]