Investment Rating - The investment rating for the construction and engineering industry is "Positive" and maintained [11] Core Insights - The concept of "National Strategic Hinterland" has gained prominence, particularly in Sichuan, with emphasis on its role in supporting national development strategies [6][19] - Sichuan is highlighted as a key area for infrastructure development, with significant construction demand anticipated due to its economic strength and strategic location [8][30] - Shaanxi is positioned as a core area of the "Belt and Road" initiative, benefiting from its high proportion of infrastructure investment [9][22] - Chongqing is recognized for its ongoing development within the Chengdu-Chongqing economic circle, with several major projects expected to bolster regional economic growth [10][25] Summary by Sections National Strategic Hinterland - The "National Strategic Hinterland" serves as a concrete representation of the "Great Rear" concept, providing substantial support to frontier regions, primarily referring to inland urban clusters in central and western China [6][17] Key Regions: Focus on Sichuan, with Attention to Shaanxi and Chongqing - **Sichuan**: Identified as a national strategic hinterland with robust infrastructure needs, projected to accelerate construction progress in the near term [8][30] - **Shaanxi**: Expected to benefit from the "Belt and Road" initiative and strategic hinterland construction, with a significant focus on infrastructure investment [9][22] - **Chongqing**: Continues to advance the Chengdu-Chongqing economic circle, with major projects like the Three Gorges Waterway and Western Land-Sea New Corridor expected to support economic and construction demand [10][25]

Core Viewpoint - The market is showing strong structural characteristics, with a focus on growth sectors, and the trend of manufacturing upgrades is expected to create structural investment opportunities in the medium to long term [2][10]. Industry Performance Summary 1) Energy and Basic Materials - Non-ferrous metals continue to rise, while other cyclical products show mixed price performance. In September, the prices of thermal coal, cement index, and glass index increased by 1.3%, 0.6%, and 2.4% respectively, while prices for coking coal, coke, rebar, iron ore, and chemical indices fell by 2.2%, 1.2%, 2.0%, 0.9%, and 1.3% respectively [3]. - The Federal Reserve's 25 basis point rate cut in September aligns with market expectations, leading to a rapid increase in gold prices, while industrial metals and some minor metals (cobalt, tungsten) also saw price increases [3]. 2) Industrial Products - The energy transition supports demand for electrical equipment, and policies aimed at reducing competition are catalyzing price rebounds across various segments of the photovoltaic industry. In August, excavator domestic sales grew by 22% year-on-year, and exports increased by 13% [4]. - The new energy sector is experiencing significant growth, with wind and solar installations increasing by 72% and 65% year-on-year respectively [4]. 3) Consumer Products - The growth rate of home appliance sales has slowed, with sales of washing machines, refrigerators, and air conditioners all showing a 1% year-on-year increase in August. The textile and apparel sectors are also facing challenges in both domestic and overseas demand [5]. - The average daily room rate (ADR), occupancy rate (OCC), and revenue per available room (RevPAR) in the hotel sector all saw year-on-year declines of 0.6%, 1.5%, and 2.1% respectively [5]. 4) Technology - The strong demand for AI computing power continues to be validated, driving growth in sub-sectors such as optical modules, switches, and servers. In July, major cloud service providers adjusted their 2025 capital expenditure guidance upwards [6]. - The semiconductor industry remains robust, with global semiconductor sales increasing by 20.6% year-on-year in July, and China's semiconductor sales growing by 10.4% [6]. 5) Financials - The insurance sector saw a 9.6% year-on-year increase in premium income in August, while the total assets of insurance companies grew by approximately 17.5% year-on-year [7]. - The real estate sector remains at a low point, with a 0.5% year-on-year decline in property sales area in September, despite a slight month-on-month increase [7]. 6) Recommendations - Focus on AI computing and robotics-related industries, which are expected to remain attractive until a significant change in industry conditions occurs [8]. - Consider sectors like innovative pharmaceuticals, consumer electronics, batteries, and non-ferrous metals, which are still in a favorable supply-demand cycle [8]. - Monitor the "14th Five-Year Plan" related fields, especially as the upcoming meeting in October may provide insights into policy directions [8].

Report Summary - The report presents the top ten convertible bonds for October 2025, along with an analysis of the issuing companies, including their business profiles, financial performance, and key attractions [13][23][35] Top Ten Convertible Bonds in October 2025 1. Zhongte Convertible Bond - Rating: AAA; 9 - month - end closing price: 112.896 yuan; Conversion premium rate: 85.92%; PE - TTM of the underlying stock: 13.22 [7][13] - Company: A globally leading specialized special - steel material manufacturer with a production capacity of about 20 million tons of special - steel materials per year. It has multiple production and raw - material bases, forming a strategic layout along the coast and rivers [13] - Financials: In 2024, revenue was 109.203 billion yuan (YoY - 4.22%), net profit attributable to shareholders was 5.126 billion yuan (YoY - 10.41%). In H1 2025, revenue was 54.715 billion yuan (YoY - 4.02%), net profit attributable to shareholders was 2.798 billion yuan (YoY + 2.67%) [13] - Key attractions: It is one of the world's most comprehensive special - steel enterprises in terms of variety and specification, with leading cost - control ability and potential for external expansion [14] 2. Shanlu Convertible Bond - Rating: AAA; 9 - month - end closing price: 119.346 yuan; Conversion premium rate: 48.74%; PE - TTM of the underlying stock: 4.08 [7][23] - Company: Mainly engaged in road and bridge construction and maintenance, and also expanding into other fields. It can provide one - stop comprehensive services [23] - Financials: In 2024, revenue was 71.348 billion yuan (YoY - 2.3%), net profit attributable to shareholders was 2.322 billion yuan (YoY + 1.47%). In H1 2025, revenue was 28.575 billion yuan (YoY + 0.26%), net profit attributable to shareholders was 1.029 billion yuan (YoY + 0.89%) [23] - Key attractions: It has the concept of "China - specific valuation", potential for improvement in various aspects under the debt - resolution background, and opportunities from regional infrastructure construction and the Belt and Road Initiative [24] 3. Hebang Convertible Bond - Rating: AA; 9 - month - end closing price: 126.41 yuan; Conversion premium rate: 21.55%; PE - TTM of the underlying stock: - 168.47 [7][35] - Company: With advantages in mineral resources and gas supply, it has completed a basic layout in the chemical, agricultural, and photovoltaic fields [35] - Financials: In 2024, revenue was 8.547 billion yuan (YoY - 3.13%), net profit attributable to shareholders was 31 million yuan (YoY - 97.55%). In H1 2025, revenue was 3.921 billion yuan (YoY - 19.13%), net profit attributable to shareholders was 52 million yuan (YoY - 73.07%) [35] - Key attractions: Its phosphate mines and salt mines have good profit - making potential, and the liquid methionine business is a major profit contributor [36] 4. Aima Convertible Bond - Rating: AA; 9 - month - end closing price: 128.513 yuan; Conversion premium rate: 38.62%; PE - TTM of the underlying stock: 13.41 [7][45] - Company: The leading enterprise in the electric two - wheeled vehicle industry, mainly engaged in R & D, production, and sales of electric two - wheeled vehicles [45] - Financials: In 2024, revenue was 21.606 billion yuan (YoY + 2.71%), net profit attributable to shareholders was 1.988 billion yuan (YoY + 5.68%). In H1 2025, revenue was 13.031 billion yuan (YoY + 23.04%), net profit attributable to shareholders was 1.213 billion yuan (YoY + 27.56%) [45] - Key attractions: It may benefit from government subsidies, new national standards, and potential improvement in gross margin [46] 5. Xingye Convertible Bond - Rating: AAA; 9 - month - end closing price: 120.859 yuan; Conversion premium rate: 29.02%; PE - TTM of the underlying stock: 5.43 [7][54] - Company: One of the first joint - stock commercial banks in China, evolving into a modern financial service group [54] - Financials: In 2024, revenue was 212.226 billion yuan (YoY + 0.66%), net profit attributable to shareholders was 77.205 billion yuan (YoY + 0.12%). In H1 2025, revenue was 110.458 billion yuan (YoY - 2.29%), net profit attributable to shareholders was 43.141 billion yuan (YoY + 0.21%) [54] - Key attractions: It has stable asset quality and scale growth [55] 6. Wentai Convertible Bond - Rating: AA -; 9 - month - end closing price: 128.918 yuan; Conversion premium rate: 20.93%; PE - TTM of the underlying stock: - 23.14 [7][66] - Company: A globally leading semiconductor enterprise adopting the IDM model, providing R & D, manufacturing, and testing services [66] - Financials: In 2024, revenue was 73.598 billion yuan (YoY + 20.23%), net profit attributable to shareholders was - 2.833 billion yuan (YoY - 339.83%). In H1 2025, revenue was 25.341 billion yuan (YoY - 24.56%), net profit attributable to shareholders was 474 million yuan (YoY + 237.36%) [66] - Key attractions: After focusing on the semiconductor business, it benefits from market recovery and has growth potential in the automotive and consumer electronics fields [67] 7. Chongyin Convertible Bond - Rating: AAA; 9 - month - end closing price: 121.778 yuan; Conversion premium rate: 31.87%; PE - TTM of the underlying stock: 5.88 [7][77] - Company: An early local joint - stock commercial bank in the upper reaches of the Yangtze River and Southwest China, with a wide range of business scopes [77] - Financials: In 2024, revenue was 13.679 billion yuan (YoY + 3.54%), net profit attributable to shareholders was 5.117 billion yuan (YoY + 3.8%). In H1 2025, revenue was 7.659 billion yuan (YoY + 7%), net profit attributable to shareholders was 3.19 billion yuan (YoY + 5.39%) [77] - Key attractions: It can benefit from the development of the Chengdu - Chongqing economic circle, has stable asset - scale growth, and effective risk - control strategies [78] 8. Tianye Convertible Bond - Rating: AA +; 9 - month - end closing price: 120.562 yuan; Conversion premium rate: 48.06%; PE - TTM of the underlying stock: 146.42 [7][89] - Company: A leading enterprise in the chlor - alkali chemical industry in Xinjiang, with an integrated circular economy industrial chain [89] - Financials: In 2024, revenue was 11.156 billion yuan (YoY - 2.7%), net profit attributable to shareholders was 68 million yuan (YoY + 108.83%). In H1 2025, revenue was 5.16 billion yuan (YoY - 0.98%), net profit attributable to shareholders was - 9 million yuan (YoY - 228.22%) [89] - Key attractions: It may benefit from the price change of caustic soda and has plans for dividend increase and coal - mine projects [90] 9. Aorui Convertible Bond - Rating: AA -; 9 - month - end closing price: 126.412 yuan; Conversion premium rate: 40.56%; PE - TTM of the underlying stock: 22.72 [7][100] - Company: A company focusing on the R & D, production, and sales of complex APIs and preparations, with leading positions in multiple fields [100] - Financials: In 2024, revenue was 1.476 billion yuan (YoY + 16.89%), net profit attributable to shareholders was 355 million yuan (YoY + 22.59%). In H1 2025, revenue was 822 million yuan (YoY + 12.5%), net profit attributable to shareholders was 235 million yuan (YoY + 24.55%) [100] - Key attractions: It has a growing dealer network, expanding preparation products, and high - quality customer resources [101] 10. Yushui Convertible Bond - Rating: AAA; 9 - month - end closing price: 125.081 yuan; Conversion premium rate: 30.74%; PE - TTM of the underlying stock: 26.93 [7][108] - Company: The largest integrated water supply and drainage enterprise in Chongqing, with a stable monopoly position [108] - Financials: In 2024, revenue was 6.999 billion yuan (YoY - 3.52%), net profit attributable to shareholders was 785 million yuan (YoY - 27.88%). In H1 2025, revenue was 3.519 billion yuan (YoY + 7.16%), net profit attributable to shareholders was 458 million yuan (YoY + 10.06%) [108] - Key attractions: It has a high market share, is expanding business externally, and has effective cost - control measures [109]

Core Insights - The article highlights significant fluctuations in the market prices of silver and tin, which have impacted the stock price of Xingye Silver Tin [1] Performance - Chipone Technology expects a record high quarterly revenue of 1.284 billion yuan for Q3 [1] - Great Wall Motors reported a year-on-year sales increase of 23.29% in September [1] - Foton Motor's total vehicle sales in September grew by 6.08% year-on-year, with new energy vehicle sales increasing by 47.77% [1] - BYD experienced a year-on-year decline of 5.52% in new energy vehicle sales in September [1] - Seres saw a year-on-year sales increase of 8.33% in September [1] - BAIC Blue Valley's subsidiary reported a year-on-year sales increase of 30.15% in September [1] - Yonghe Holdings anticipates a year-on-year net profit increase of 211.59% to 225.25% for the first three quarters [1] Shareholding Changes - Huaxing Yuanchuang's shareholders plan to reduce their holdings by no more than 0.9% [1] - Ruile New Materials' shareholders intend to reduce their holdings by no more than 100,800 shares [1] Share Buybacks - Huaxin Cement plans to repurchase shares worth between 32.25 million and 64.5 million yuan [1] Contract Awards - Bomei Technology signed a contract for an offshore floating production storage and offloading vessel project, valued at approximately 190 to 240 million USD [1] - Sichuan Gold acquired exploration rights for the Kugezi-Juebei gold mine in Xinjiang [1] - Weisheng Information won projects totaling 287 million yuan, accounting for 10.45% of the company's expected revenue for 2024 [1] - Innovent Biologics' subsidiary signed a licensing agreement for the drug Orelabrutinib and two preclinical assets, with a total transaction value exceeding 2 billion USD [1] - Runjian Co. plans to bid for a land-based wind power project worth 1.753 billion yuan [1] - Xinjiang Jiaojian intends to bid for a highway construction project valued at 483 million yuan [1] Equity Changes - Delixi Holdings is planning a change in company control, leading to a stock suspension [1] - Bofei Electric plans to transfer 100% equity of its wholly-owned subsidiary Bofei New Energy [1] Other Developments - Dianguang Media holds 4.1288 million shares of Ruili Technology through Dacheng Venture Capital, representing 2.2915% of its post-issue total share capital [1] - Huaxin Cement has terminated plans for a spin-off listing of its overseas subsidiary [1] - Baili Tianheng received approval for clinical trials of BL-ARC001 for late-stage solid tumor treatment [1] - *ST Gaohong received a notice of termination of listing [1] - *ST Jianyi plans to sign an agreement to terminate the investment cooperation for the monocrystalline silicon project and deregister Jianyi Zhengyao [1]

Core Viewpoint - Hebei Construction, known as the "first stock of Xiong'an," is facing a disappointing IPO with a subscription rate of only 0.99 times, raising concerns about its market reception in Hong Kong [1][2][8]. Company Overview - Hebei Construction primarily engages in construction contracting, accounting for over 95% of its revenue, and has been recognized as a significant player in the industry, ranking 366th in the "China Top 500 Enterprises" and 20th in the "Top 80 Chinese Contractors" [3][4]. - The company has established partnerships with the Xiong'an government to develop three companies aimed at the Xiong'an New Area, indicating its strategic involvement in major regional developments [4]. Financial Performance - In the first half of 2017, Hebei Construction reported revenues of 20.218 billion RMB and a net profit of 500 million RMB, suggesting a relatively strong financial position [5]. - The company's IPO will result in a total share capital of 1.733 billion shares, with an issue price of 4.46 HKD, leading to a market capitalization of 7.73 billion HKD [7]. Market Sentiment - The Hong Kong market is characterized by a cautious approach to stock pricing, with investors often requiring tangible evidence of performance before committing [6][8]. - Despite Hebei Construction's low price-to-earnings (PE) ratio of 6.45 and price-to-book (PB) ratio of 2.65, these valuations may not attract investors in a market where lower valuations are available [7][8]. Financial Structure and Risks - The company has a high debt ratio of approximately 95%, which is likely to deter mainstream investors in the Hong Kong market [12]. - The IPO proceeds will be allocated primarily to unfinished projects and public-private partnership (PPP) projects, which are often seen as financial black holes due to their long construction periods and delayed revenue generation [14][15]. - The cash flow situation appears challenging, with significant outflows reported in the first half of 2017, indicating potential difficulties in maintaining liquidity [16].

Investment Rating - The report maintains a "Positive" investment rating for the construction and engineering industry [11]. Core Insights - The construction industry continues to experience a downward trend, with a focus on the government's fiscal efforts in the fourth quarter [2]. - The Purchasing Managers' Index (PMI) for the construction sector fell below 50, indicating contraction, primarily due to a decrease in new orders and weakened market demand [6][18]. - Fixed asset investment (FAI) has shown a continued decline, influenced by a significant drop in real estate and infrastructure investments [7][21]. Summary by Sections Investment & Orders - The construction PMI for August was reported at 49.1%, down 1.5 percentage points year-on-year and month-on-month, with the new orders index at 40.6%, reflecting a decrease of 2.9 percentage points year-on-year and 2.1 percentage points month-on-month [6][18]. - Fixed asset investment in August was 3.8 trillion yuan, a year-on-year decrease of 7.1%, with manufacturing investment also declining by 1.8% [22][36]. - Infrastructure investment for August was 1.5 trillion yuan, down 5.8% year-on-year, with a cumulative investment of 12 trillion yuan for the first eight months, reflecting a 2.0% increase year-on-year [23][36]. Physical Workload - August saw a seasonal slowdown in construction activities due to high temperatures, with cement production declining by 6.2% year-on-year [8][50]. - The construction workload is expected to rebound in September as the industry enters its peak season [8][50]. Project Funding - As of September 16, the funding availability rate for construction sites was 59.39%, with non-residential projects at 61.21% and residential projects at 50.58% [58]. - In August, new special bonds issued exceeded 485.6 billion yuan, with a total issuance progress of 80% by September 19 [60].

Core Points - The Shanghai Composite Index is currently at 3791.74 points, with a decline of 0.96%, and the total trading volume of A-shares is 20,625.52 billion yuan [1] - A total of 17 A-shares have surpassed their annual line today, with notable stocks showing significant deviation rates, including Jinfu Technology, Xinhua Jin, and Nanjing Bank, with deviation rates of 7.49%, 3.74%, and 3.17% respectively [1] Summary by Category Stock Performance - Jinfu Technology (300128) has increased by 8.01% with a turnover rate of 12.11%, latest price at 5.80 yuan, and a deviation rate of 7.49% [1] - Xinhua Jin (600735) has risen by 10.07% with a turnover rate of 10.26%, latest price at 6.23 yuan, and a deviation rate of 3.74% [1] - Nanjing Bank (601009) has seen a 4.78% increase with a turnover rate of 1.09%, latest price at 10.96 yuan, and a deviation rate of 3.17% [1] Other Notable Stocks - Tiancheng Automation (603085) has increased by 4.33% with a turnover rate of 8.71%, latest price at 11.08 yuan, and a deviation rate of 2.39% [1] - Shanghai Lingang (600848) has risen by 2.74% with a turnover rate of 0.98%, latest price at 9.74 yuan, and a deviation rate of 2.04% [1] - Qilu Bank (601665) has increased by 2.84% with a turnover rate of 2.25%, latest price at 5.80 yuan, and a deviation rate of 1.68% [1]

Investment Rating - The report maintains a "Positive" investment rating for the industry [9]. Core Insights - The Hong Kong government's recent policy report emphasizes the development of the Northern Metropolis, which is strategically significant due to its proximity to Shenzhen and potential to create numerous jobs and enhance productivity [2][6]. - The establishment of the Northern Metropolis Development Committee and its sub-groups aims to clarify the organizational structure for the area's development [10]. - The report highlights the introduction of social capital in the development process, utilizing mechanisms such as 1.5-level development and BOT (Build-Operate-Transfer) models to enhance project execution [10]. - Infrastructure projects in the Northern Metropolis are progressing rapidly, with significant transportation developments planned to support the area's growth [10]. - China State Construction International is expected to benefit significantly from the Northern Metropolis projects, with a projected market share increase in Hong Kong's infrastructure sector [10]. - The company maintains a double-digit profit guidance for 2025, with a projected dividend yield of approximately 6.6% based on a 33% payout ratio [10].

Market Overview - The market experienced a downward trend on September 19, with all three major indices closing lower: Shanghai Composite Index down 0.30%, Shenzhen Component Index down 0.04%, and ChiNext Index down 0.16% [2] - Over 3,400 stocks in the market closed lower, with trading volume significantly shrinking to 2.32 trillion yuan, a decrease of 811.3 billion yuan compared to the previous trading day [2] Technical Analysis - The Shanghai Composite Index showed a larger decline, with its daily K-line falling below the 20-day moving average and approaching the 30-day moving average, indicating a challenging technical outlook [3] - Both Shenzhen and ChiNext indices maintained an upward trend above the 5-day moving average despite closing with doji candlesticks [5] Market Sentiment - Following the pattern of "big drop followed by recovery," several sectors initiated a rebound, with the Shenzhen and ChiNext indices showing positive performance for longer periods during the day [7] - However, the overall market recovery was weak, with a significant reduction in trading volume, indicating a decline in short-term sentiment [7] Sector Performance - The top-performing sectors included energy metals, tourism, and photolithography, with energy metals rising by 3.23% and tourism and hotels increasing by 2.08% [14][17] - The energy metals sector is particularly noteworthy due to the upcoming 2025 Suining International Lithium Battery Industry Conference, which aims to enhance lithium battery technology innovation [16][17] Investment Opportunities - The tourism sector is expected to benefit from the upcoming "super golden week" during the National Day holiday, with a reported 45% year-on-year increase in cross-province travel orders [17] - The photolithography sector is gaining traction due to recent developments in domestic chip manufacturing, particularly following announcements from Huawei regarding its Ascend chip roadmap [20] Company Developments - Shanghai Construction Group faced a rapid decline, hitting the limit down after a five-day winning streak, reflecting broader market trends [7] - The engineering machinery sector is showing signs of recovery, driven by various factors including military, civil explosives, and automotive components, with notable stocks like Shanhe Intelligent returning to the spotlight [22]

Summary of EMCOR Conference Call Company Overview - **Company Name**: EMCOR - **Industry**: Skilled trades and construction services - **Key Segments**: - Mechanical and electrical services (70-75% of revenue) - Building services (75% of building services revenue) - Industrial services (focused on oil and gas) - Facility services in the UK - **Revenue Projection**: Expected to generate between $16.3 billion and $16.9 billion in revenue for the year [15] Core Business Insights - **Business Model**: EMCOR operates as a contractor, adapting to customer demand rather than creating it [6] - **Workforce**: The company employs skilled tradespeople including plumbers, electricians, and HVAC technicians [4] - **Safety Standards**: EMCOR emphasizes safety, achieving a Total Recordable Incident Rate (TRIRR) of less than one, which is significantly better than industry standards [9] Growth Drivers - **Data Centers**: Significant growth in data center construction, with revenues more than doubling from previous years [23] - **Reshoring**: The company has invested in expanding its footprint in the Southeast and Midwest, anticipating growth from reshoring trends [18][21] - **Healthcare and Manufacturing**: Healthcare revenues are up 40% year-to-date, and traditional manufacturing revenues have increased by over 30% year-over-year [23][21] Financial Performance - **Revenue Growth**: EMCOR has experienced a compound annual growth rate (CAGR) of approximately 9.5% to 10% over the past five years, while headcount growth has only been 3% to 3.5% [51] - **Capital Allocation**: The company maintains a balanced approach to capital allocation, with a focus on reinvestment, M&A, and shareholder returns [57] Workforce Strategy - **Training and Development**: EMCOR invests heavily in training its workforce, with a focus on leadership development and safety [53][55] - **Retention Rates**: Retention of key leadership is over 85%, indicating strong employee satisfaction and loyalty [55] Regulatory Environment - **Impact of Legislation**: The company adapts to changing regulatory environments, benefiting from favorable conditions under Democratic administrations, such as the CHIPS Act [31][30] - **Union Workforce**: EMCOR's construction workforce is primarily unionized, which aids in recruitment and training [31] M&A Strategy - **Recent Acquisition**: EMCOR acquired Miller Electric, enhancing its presence in the Southeast and aligning with its strategic focus on electrical and mechanical services [58] - **Acquisition Criteria**: The company prioritizes firms that can execute well in the field and share similar values, avoiding those with poor reputations [62][64] Conclusion - **Market Position**: EMCOR is well-positioned to capitalize on growth in data centers, reshoring, and healthcare, while maintaining a disciplined approach to capital allocation and workforce development [16][57]