Summary of China Property Industry Conference Call Industry Overview - The housing industry in China is expected to continue its downtrend in 2026, but with milder declines compared to previous years. The physical market may take longer to bottom out as restoring resident confidence becomes more challenging. However, quality alpha plays are anticipated to outperform negative industry beta [1][3][10]. Key Points Policy Stance - A reactive policy stance is likely to persist, with housing policy narratives in 2026 expected to mirror those of 2025. Risk mitigation will remain the top priority for regulators, with any fiscal-backed stimulus likely to be measured and implemented in the second half of the year to cushion home price declines [3][12][13]. Market Projections - The physical market may not bottom until 2027, with a high single-digit percentage year-on-year drop in primary sales volume and secondary home prices. New starts, completions, and real estate investment are projected to decline in the mid-teens percentage year-on-year [4][10]. Developer Performance - Developers are still facing challenges, with liquidity risk becoming less of a concern. However, industry margins may continue to decline due to lower home prices. State-owned enterprises (SOEs) with quality land banks may see pre-sales margins stabilize in 2026, while private-owned enterprises (POEs) will focus on project completion and deleveraging [5][10]. Investment Opportunities - There is expected to be a divergence in share prices between the overall industry and quality names with credible self-help stories. CR Land and Seazen A are favored as robust mall operators benefiting from policy tailwinds, while C&D and COLI are seen as consolidators in the residential market with optimized land banks supporting margins and earnings [6][10]. Additional Insights - The national primary residential inventory remains high at approximately 2.3 billion square meters, translating to an inventory level of 29.4 months. This includes 0.4 billion square meters of completed inventory, 1.6 billion square meters under construction, and 0.4 billion square meters of idle land [32][38]. - The sentiment among homeowners is deteriorating, with many willing to take losses on property sales. A significant percentage of respondents in tier 1 cities expect housing prices to fall further [30][34]. - Secondary home listings in major cities continue to rise, which may exert downward pressure on secondary home prices in 2026 [35][43]. Conclusion - The China property market is expected to face continued challenges in 2026, with a focus on risk mitigation rather than growth. While quality developers may find opportunities, the overall market sentiment remains weak, and the path to recovery may be prolonged.

Summary of UBS Global I/O Semiconductors Conference Call Industry Overview - **Industry**: Automotive Semiconductors - **Market Outlook**: Positive momentum in the automotive semiconductor market is expected to continue into H2'25 and 2026E, following a recent inflection point in Q2'25 with a 1% year-over-year revenue growth after seven consecutive quarters of decline [1][2]. Key Points 1. **Analog Revenue Growth**: - The automotive semiconductor sector has seen a return to positive revenue growth, with a 1% year-over-year increase in Q2'25, marking the first positive growth since Q2'23. Projections for Q3 and Q4 indicate expected growth rates of 4% and 14% year-over-year, respectively [2][3]. 2. **Automotive and Industrial Revenue Forecasts**: - Automotive semiconductor revenues are forecasted to decline by 7% year-over-year in 2025E, an improvement from a previous estimate of -9%. A rebound is expected in 2026E with an 11% growth [3][11]. - Industrial semiconductor revenues are projected to grow by 8% year-over-year in 2025E, up from a previous estimate of 6%, following a decline of 19% in 2024 [3][11]. 3. **Regional Demand Insights**: - In China, automotive semiconductor demand is expected to grow by 4% year-over-year in 2025E, down from 21% in 2024. Non-China markets are projected to remain flat [4][16]. - Year-to-date, China car volumes have increased by 14% year-over-year, with new energy vehicles (NEV) growing by 37% [4]. 4. **Leading Indicators**: - Positive leading indicators include a return to quarter-over-quarter semiconductor revenue growth in Q2'25, with estimates of 5% and 14% growth for Q3 and Q4, respectively. Additionally, semiconductor inventory days are declining, expected to reach 162 days in Q3'25, down from 175 days in Q2'25 [5][9]. 5. **Sector Preferences**: - The analog semiconductor sector is currently trading at approximately 20x P/E for 2026E, compared to a 10-year average of 19x. Preferred companies include Texas Instruments (TI), Infineon (IFX), and Renesas, while ON Semiconductor and Melexis are rated neutral [6][24]. 6. **Risks and Challenges**: - Potential downside risks include deteriorating car production/sales, increasing tariffs, pricing pressure on semiconductors, and a slowdown in Chinese demand in H2'25 [5][9]. Additional Insights - **Market Pricing**: The market appears to be pricing in a low single-digit percentage decline in semiconductor revenues, with a volume increase of 5-15% expected in 2026E [6][24]. - **China's Market Dynamics**: The growth in China's automotive semiconductor market is expected to normalize, with global incumbents potentially facing a 1% revenue decline in 2025 due to competition from domestic players [16][19]. This summary encapsulates the key insights and projections from the UBS Global I/O Semiconductors conference call, highlighting the optimistic outlook for the automotive semiconductor industry while acknowledging potential risks and regional dynamics.