Core Viewpoint - The report highlights the strong performance of leading companies in the electronic fabric and copper foil sectors, driven by AI contributions and improvements in core business operations, indicating a positive market outlook for these segments [1][2]. Group 1: Electronic Fabric and Copper Foil - Two leading companies in electronic fabric and copper foil have reported better-than-expected mid-year results, primarily due to AI's contribution to profits and continued improvement in their core businesses [2]. - For instance, Zhongcai Technology's AI electronic fabric products have seen increased shipments, and its wind power blade business has experienced both volume and price increases in Q2, with expectations for further improvement in Q3 [2]. - Copper Crown Copper Foil's HVLP series products have achieved bulk shipments, and the lithium battery copper foil segment has shown significant loss reduction and margin recovery [2]. Group 2: Market Trends and Opportunities - Market attention is shifting towards liquid cooling, power supplies, and generators, but electronic fabric and copper foil remain high-demand sectors, expected to lead in unit value enhancement [2]. - The report expresses optimism for the African building materials market and highlights Keda Manufacturing as a leading local player, with a strong growth forecast for the first half of the year [2]. Group 3: Quantum Computing Developments - The report notes advancements in quantum computing, with strategic partnerships aimed at integrating quantum computing with AI for practical applications [3]. - IBM's 2025 quantum roadmap indicates significant progress, with plans to deliver a large-scale fault-tolerant quantum computer by 2029 [3]. Group 4: Traditional Building Materials Transformation - Traditional building material companies are accelerating their core business transformations, with notable acquisitions and investments in generative AI [4]. Group 5: Market Data and Trends - Cement prices averaged 343 RMB per ton this week, showing a year-on-year decrease of 36 RMB, while the average utilization rate for concrete mixing stations was reported at 6.86% [5]. - The glass market saw a decline in prices, with the average price for float glass at 1205.78 RMB per ton, down 2.42% from the previous week [5].

Investment Rating - The report maintains a positive outlook on the PCB upstream industry chain, particularly focusing on copper foil, electronic cloth, and equipment [1][11]. Core Insights - The report emphasizes the importance of monitoring the price trends of AI copper foil and the recent price increases announced by several CCL companies, indicating a favorable market environment for AI copper foil due to low domestic replacement rates and a healthy competitive landscape [1][11]. - The report highlights the robust growth potential in the African building materials sector, particularly for local manufacturing companies like Keda Manufacturing, which is expected to benefit from increased local production and supply chain protection [12][13]. - Traditional building materials are showing signs of recovery, with improved land acquisition sentiment and a potential stabilization in new construction starts, suggesting a positive trend for the real estate sector [13]. Summary by Sections Weekly Discussion - Continued recommendation for PCB upstream industry chain, focusing on AI copper foil, electronic cloth, and equipment due to favorable market conditions and limited domestic competition [1][11]. Cyclical Linkage - Cement prices are under pressure, with a national average of 340 RMB/t, down 42 RMB year-on-year, while glass prices are declining, indicating a challenging environment for these sectors [14][15]. - The report suggests that the demand for AI materials, particularly high-end copper foil and special fiberglass, remains strong, with price trends serving as key indicators of market health [15][16]. Market Performance - The building materials index showed a positive performance of 4.07% during the week, with specific segments like fiberglass and cement also reflecting gains, indicating a recovering market sentiment [18][29]. Building Materials Price Changes - National cement prices increased by 0.2% week-on-week, with regional variations in price adjustments, reflecting a gradual recovery in demand as weather conditions improve [29][30]. - The floating glass market continues to face challenges, with prices declining and inventory pressures persisting, although some signs of demand recovery are noted [39][40]. Fiberglass Market - The domestic fiberglass market remains stable, with prices holding steady, while electronic cloth prices are also stable, indicating a balanced supply-demand scenario [61][62]. Carbon Fiber Market - The carbon fiber market is stable, with prices averaging 83.75 RMB/kg, reflecting steady production rates and cautious demand from downstream industries [67][68].

Core Viewpoint - The monitoring of market prices for 50 important production materials in China shows a mixed trend, with 18 products experiencing price increases, 29 seeing declines, and 3 remaining stable in early August 2025 compared to late July 2025 [2]. Group 1: Price Changes in Major Categories - In the black metal category, prices for rebar and wire rod decreased by 1.1% and 1.3% respectively, while seamless steel pipes saw a slight increase of 0.1% [4]. - The non-ferrous metals category experienced declines in prices for electrolytic copper, aluminum ingots, lead ingots, and zinc ingots, with decreases ranging from 0.5% to 1.7% [4]. - Chemical products showed a mixed performance, with sulfuric acid and methanol prices increasing by 1.7% and 0.6% respectively, while other products like styrene and polyvinyl chloride saw significant declines [4]. Group 2: Energy and Coal Prices - In the petroleum and natural gas sector, liquefied natural gas (LNG) and liquefied petroleum gas (LPG) prices fell by 2.2% and 1.7% respectively, while gasoline prices remained relatively stable [4]. - Coal prices showed an upward trend, with prices for various types of coal, including anthracite and coking coal, increasing by 2.5% to 9.6% [4]. Group 3: Agricultural and Forestry Products - Agricultural products such as corn, cotton, and live pigs experienced price declines, with cotton prices dropping by 3.5% and corn by 0.5% [5]. - Conversely, soybean meal prices increased by 1.3%, indicating some resilience in the agricultural sector [5]. - In forestry products, natural rubber and paper pulp prices fell, while corrugated paper prices increased by 1.7% [5]. Group 4: Monitoring Methodology - The price monitoring encompasses 9 major categories and 50 products, with data collected from over 2,000 wholesalers and dealers across 31 provinces [8][9]. - The methodology includes on-site price collection, telephone inquiries, and electronic communications to ensure comprehensive data gathering [9]. Group 5: Price Fluctuation Statistics - The statistics on price fluctuations indicate that the number of products with rising prices is significantly lower than those with declining prices, reflecting a broader trend of price reductions in the monitored categories [10].

Financial Overview - The total assets of the company as of June 30, 2025, amounted to approximately RMB 13.14 billion, a decrease from RMB 13.50 billion as of December 31, 2024 [1][2][3] - Total liabilities decreased to approximately RMB 1.20 billion from RMB 1.49 billion during the same period [1][2][3] - Shareholder equity totaled approximately RMB 11.95 billion, down from RMB 12.01 billion [2][3][6] Income Statement Highlights - The company's total operating revenue for the first half of 2025 was approximately RMB 2.06 billion, an increase from RMB 1.98 billion in the same period of 2024, reflecting a growth of about 4% [3][4] - Operating costs rose to approximately RMB 1.80 billion from RMB 1.75 billion, indicating an increase of about 3% [3][4] - The net profit for the first half of 2025 was approximately RMB 440 million, compared to RMB 235 million in the same period of 2024, representing a significant increase [3][4][5] Cash Flow Analysis - The net cash flow from operating activities for the first half of 2025 was approximately RMB 135 million, a notable increase from RMB 33 million in the same period of 2024 [4][5] - Cash flow from investing activities showed a net inflow of approximately RMB 23 million, a decrease from RMB 921 million in the previous year [4][5] - Cash flow from financing activities resulted in a net outflow of approximately RMB 504 million, compared to RMB 558 million in the first half of 2024 [4][5] Shareholder Equity Changes - The total equity attributable to shareholders of the parent company decreased to approximately RMB 11.89 billion from RMB 11.95 billion [2][6] - The company reported a decrease in other comprehensive income, which was negative RMB 6.50 million compared to a positive RMB 5.85 million in the previous period [2][6] - The retained earnings as of June 30, 2025, were approximately RMB 6.29 billion, down from RMB 6.38 billion [2][6]

Core Viewpoint - The monitoring of market prices for 50 important production materials across nine categories indicates a general upward trend, with 36 products experiencing price increases, while 8 saw declines, and 6 remained stable in late July 2025 compared to mid-July 2025 [1]. Price Changes Summary 1. Black Metals - Rebar (Φ20mm, HRB400E) increased by 143.5 CNY to 3304.1 CNY, a rise of 4.5% - Wire rod (Φ8-10mm, HPB300) rose by 141.5 CNY to 3469.0 CNY, an increase of 4.3% - Ordinary medium plate (20mm, Q235) increased by 123.6 CNY to 3526.3 CNY, a rise of 3.6% - Hot-rolled ordinary plate (4.75-11.5mm, Q235) increased by 175.2 CNY to 3474.3 CNY, a rise of 5.3% [3]. 2. Non-ferrous Metals - Electrolytic copper (1) rose by 1161.1 CNY to 79474.4 CNY, an increase of 1.5% - Aluminum ingot (A00) increased by 175.8 CNY to 20767.5 CNY, a rise of 0.9% - Lead ingot (1) decreased by 53.1 CNY to 16734.4 CNY, a decline of 0.3% - Zinc ingot (0) increased by 528.0 CNY to 22746.3 CNY, a rise of 2.4% [3]. 3. Chemical Products - Sulfuric acid (98%) increased by 10.2 CNY to 704.3 CNY, a rise of 1.5% - Caustic soda (liquid, 32%) decreased by 0.8 CNY to 871.7 CNY, a decline of 0.1% - Methanol (first grade) increased by 34.1 CNY to 2255.5 CNY, a rise of 1.5% - Polyvinyl chloride (SG5) increased by 197.7 CNY to 5056.7 CNY, a rise of 4.1% [3]. 4. Oil and Natural Gas - Liquefied natural gas (LNG) decreased by 1.8 CNY to 4323.7 CNY, remaining stable - Gasoline (95 National VI) increased by 20.7 CNY to 8590.4 CNY, a rise of 0.2% - Diesel (0 National VI) decreased by 2.1 CNY to 7182.9 CNY, remaining stable [3]. 5. Coal - Anthracite (washed lump) decreased by 29.6 CNY to 835.8 CNY, a decline of 3.4% - Ordinary mixed coal (4500 kcal) increased by 16.7 CNY to 518.1 CNY, a rise of 3.3% - Coking coal (main coking coal) increased by 225.0 CNY to 1375.0 CNY, a rise of 19.6% [3]. 6. Non-metallic Building Materials - Ordinary Portland cement (P.O 42.5 bagged) decreased by 6.7 CNY to 355.7 CNY, a decline of 1.8% - Float glass (4.8/5mm) increased by 56.5 CNY to 1268.9 CNY, a rise of 4.7% [3]. 7. Agricultural Products - Rice (glutinous rice) decreased by 1.7 CNY to 4042.3 CNY, remaining stable - Wheat (national standard grade three) remained stable at 2422.9 CNY [4]. 8. Agricultural Production Materials - Urea (medium and small particles) decreased by 10.6 CNY to 1811.8 CNY, a decline of 0.6% - Compound fertilizer (sulfur potassium compound fertilizer) increased by 28.5 CNY to 3177.9 CNY, a rise of 0.9% [4]. 9. Forest Products - Natural rubber (standard rubber SCRWF) increased by 548.0 CNY to 14906.3 CNY, a rise of 3.8% - Pulp (imported needle pulp) increased by 32.4 CNY to 5869.0 CNY, a rise of 0.6% [4].

Group 1 - The domestic commodity futures market closed mostly higher during the night session, with non-metallic building materials leading the gains [1] - Glass prices increased by 4.93%, while PVC rose by 2.32% [1] - The black series commodities generally saw increases, with coking coal up by 3.38%, coke by 2.26%, hot-rolled coil by 1.75%, rebar by 1.30%, and iron ore by 0.95% [1] Group 2 - Energy products performed strongly, with fuel oil rising by 2.01% and low-sulfur fuel oil by 1.03% [1] - Most chemical products also saw gains, including styrene up by 2.20%, butadiene rubber by 1.32%, polypropylene by 0.83%, asphalt by 0.77%, plastic by 0.75%, ethylene glycol by 0.64%, and rubber by 0.27% [1] - Oilseeds and oils showed mixed results, with palm oil up by 1.69%, soybean meal by 0.79%, soybean two by 0.62%, and soybean oil by 0.39%, while soybean one fell by 0.52% [1] Group 3 - Agricultural and sideline products experienced slight fluctuations, with pulp up by 0.64%, corn starch by 0.64%, and corn by 0.61% [1]

Core Viewpoint - The monitoring of market prices for 50 important production materials across nine categories indicates a mixed trend in price changes, with 23 products experiencing price increases, 23 seeing declines, and 4 remaining stable during the first week of July 2025 compared to the end of June 2025 [2]. Group 1: Price Changes in Major Categories - In the black metal category, rebar prices increased by 0.9% to 3108.2 yuan per ton, while ordinary medium plates decreased slightly by 0.1% to 3371.2 yuan per ton [4]. - For non-ferrous metals, electrolytic copper rose by 1.5% to 80208.6 yuan per ton, while zinc ingots fell by 0.1% to 22257.1 yuan per ton [4]. - Chemical products showed varied results, with sulfuric acid increasing by 3.5% to 682.7 yuan per ton, while methanol decreased by 2.6% to 2257.6 yuan per ton [4]. Group 2: Energy and Coal Prices - In the petroleum and natural gas sector, liquefied natural gas (LNG) prices rose by 0.7% to 4286.8 yuan per ton, while liquefied petroleum gas (LPG) fell by 1.6% to 4511.9 yuan per ton [4]. - Coal prices showed slight increases, with anthracite coal rising by 0.9% to 829.8 yuan per ton and ordinary mixed coal increasing by 1.7% to 488.3 yuan per ton [4]. Group 3: Agricultural Products and Fertilizers - Among agricultural products, cotton prices increased by 0.9% to 14557.3 yuan per ton, while corn prices decreased slightly by 0.1% to 2368.3 yuan per ton [5]. - In agricultural production materials, the price of urea fell by 0.3% to 1820.3 yuan per ton, while the price of pesticides rose by 1.1% to 25478.6 yuan per ton [5]. Group 4: Monitoring Methodology - The price monitoring includes data from over 2000 wholesalers, agents, and distributors across more than 300 trading markets in 31 provinces [7]. - The methodology for price monitoring involves on-site price collection, telephone inquiries, and electronic communications [8].

Investment Rating - The report maintains a positive outlook on the African building materials sector and local manufacturing leader Keda Manufacturing, particularly following the ignition of Keda's base in Côte d'Ivoire in June [1][13]. Core Insights - The Kenyan government has implemented a tiered tax on imported building materials, including a 3% export promotion tax on ceramic tiles and sanitary ware, aimed at reducing import dependency and fostering local manufacturing [1][13]. - The report emphasizes the importance of local production and consumption integration, highlighting Keda Manufacturing's efforts to establish local production in multiple African countries [1][13]. - The report identifies potential investment opportunities in the PCB upstream new materials sector, particularly in electronic cloth and copper foil, driven by high demand in AI applications [2][14]. - The waterproofing industry is experiencing frequent price increases, indicating a consensus among leading companies to curb malicious competition and stabilize prices [3][15]. - The cement sector is undergoing capacity reduction efforts, with the China Cement Association advocating for a unified approach to actual and registered production capacities [3][15]. Summary by Sections Weekly Discussion - Keda Manufacturing is recognized as a leader in local production within Africa, with recent developments in Côte d'Ivoire and supportive government policies in Kenya [1][13]. Cycle Interaction - Cement prices have shown a slight decline, with an average price of 347 RMB/t, down 46 RMB year-on-year, while glass prices have increased slightly to 1204.97 RMB/t [4][16]. - The report notes a stable demand for glass and fiberglass, with the latter maintaining a price of 3669 RMB/t [4][16][61]. National Subsidy Tracking - The report highlights government initiatives to boost consumption, including subsidies for building materials, which may benefit companies like Sangor and North New Materials [5][17]. Important Changes - Several companies, including Zhongcai Technology and China Jushi, have announced significant profit increases for the first half of 2025, indicating strong performance in the building materials sector [6][21].

Group 1 - The domestic commodity futures market closed mostly higher during the night session, with the black series showing a general increase [1] - Coking coal rose by 2.60%, iron ore increased by 1.87%, coking coal gained 1.52%, hot-rolled coil went up by 1.39%, and rebar climbed by 1.36% [1] - In the non-metallic building materials sector, glass increased by 2.54%, while in the chemical products category, rubber rose by 1.19%, and butadiene rubber increased by 1.18% [1] Group 2 - In the oilseed and oil category, soybean meal rose by 0.99%, and soybean oil increased by 0.81% [1] - Energy products generally declined, with fuel oil down by 1.49%, low-sulfur fuel oil decreasing by 0.57%, and LPG falling by 0.48% [1] - In the chemical products sector, asphalt decreased by 0.28%, polypropylene fell by 0.18%, and soybean oil dropped by 0.34% [1]

Core Viewpoint - The domestic commodity futures market experienced a majority of price increases during the night session, particularly in the chemical sector, indicating a positive trend in commodity prices overall [1] Group 1: Chemical Products - The price of 20 rubber increased by 2.91% [1] - Rubber prices rose by 2.28% [1] - Styrene saw an increase of 1.60% [1] - Butadiene rubber rose by 1.59% [1] Group 2: Black Metals - Coking coal prices increased by 2.03% [1] - Coke prices rose by 1.59% [1] - Iron ore saw a price increase of 1.09% [1] Group 3: Non-Metallic Building Materials - Glass prices increased by 1.85% [1] - PVC prices rose by 1.20% [1] Group 4: Agricultural Products - Pulp prices increased by 1.33% [1] Group 5: Oils and Fats - Soybean meal rose by 0.24% [1] - Soybean oil remained stable [1] - Soybean one decreased by 0.10% [1] - Palm oil fell by 0.44% [1] Group 6: Energy Products - LPG prices increased by 0.34% [1] - Low sulfur fuel oil decreased by 0.30% [1] - Fuel oil fell by 0.60% [1]