Investment Rating - The report maintains an "Outperform" rating for the media and internet sector [5][40]. Core Viewpoints - The media sector has shown an upward trend with a 1.39% increase, although it underperformed compared to the CSI 300 (2.00%) and the ChiNext Index (3.27%) [12][14]. - Key companies such as ByteDance, Meta, and Tencent are making significant advancements in AI applications, which are expected to drive future growth in the sector [2][4][37]. - The report highlights the potential for recovery in the film industry, driven by the upcoming holiday seasons and improved supply [38]. Summary by Sections Industry Performance - The media sector's performance for the week (May 3 - May 9) was an increase of 1.39%, ranking 22nd among all sectors [12][14]. - Notable gainers included Baotong Technology (+25%), ST Zhongqingbao (+10%), and ST Huawen (+9%), while ST Tianze (-9%) and Wanda Film (-5%) were among the biggest losers [12][13]. Key Company Developments - ByteDance has open-sourced its deep research framework, DeerFlow, integrating language models with various tools for automated research and content creation [2][17]. - Meta's AI research team has released five significant breakthroughs in AI perception, marking a major advancement in the field [2][18]. - Tencent has optimized its DeepSeek communication framework, achieving performance improvements of 100% in RoCE network environments and 30% in IB network environments [2][19]. Box Office and Content Performance - The box office for the week (May 5 - May 11) reached 332 million yuan, with "Nezha: The Devil's Child" leading at 90 million yuan (27.2% market share) [3][21]. - Upcoming holiday seasons are expected to boost box office performance, with a focus on the Dragon Boat Festival and summer releases [4][38]. Investment Recommendations - The report suggests a positive outlook for AI applications and IP trends, recommending companies like Pop Mart and others in the IP and gaming sectors [4][38]. - It emphasizes the importance of the film industry recovery, recommending channels like Wanda Film and content producers like Light Media [4][38]. - The report also highlights the potential for advertising growth as the economy improves, suggesting investments in companies like Focus Media and Mango TV [4][38].

Electronic Sector - TSMC's April revenue exceeded expectations, reaching NT$349.6 billion, with a month-on-month growth of 22.2% and a year-on-year growth of 48.1%, marking a historical monthly high [1] - Cumulative revenue for January to April was NT$1,188.8 billion, a year-on-year increase of 43.5%, also a record for the same period [1] - The growth is driven by AI demand and preemptive stocking by clients concerned about tariff impacts [1] - The electronic sector's Q1 2025 revenue was NT$839.2 billion, a year-on-year increase of 17.6%, with net profit of NT$35.5 billion, up 31.2% [1] - The semiconductor materials sector showed strong performance, benefiting from increased wafer fab utilization and accelerated domestic substitution [1] Communication Sector - Leading optical module companies reported Q1 performance exceeding expectations, with revenue and profit both achieving high growth [2] - The market demand for optical modules is expected to further release due to positive signals from policy and ongoing high capital expenditures from cloud vendors [2] - Major cloud companies' capital expenditures increased significantly, with Microsoft, Meta, Google, and Amazon's spending rising 69% to US$70.6 billion [2] Computer Sector - Google DeepMind released an updated version of Gemini 2.5 Pro, enhancing programming capabilities, allowing users to generate complete web applications and games from a single prompt [3] - The AI industry chain is expected to maintain high prosperity, with strong growth in sectors like intelligent driving and software outsourcing [3] - The impact of tariff policies on computer companies' fundamentals is minimal, with domestic substitution and self-control sectors likely to benefit [3] Media and Internet Sector - Continuous tracking of AI application landing situations is recommended, with a focus on companies with upward marginal fundamentals and M&A themes [4] - The digital media sector has shown strong performance recently, while the film and television sector is expected to decline due to the off-season [4] - Companies like Tencent and Kuaishou are advancing in AI-generated content, indicating a growing potential for AI applications in media [4]

Investment Rating - The report maintains an "Increase" rating for the media industry, indicating a positive outlook for the sector [4]. Core Insights - The media sector has shown resilience with a 1.39% increase in the index from May 6 to May 9, 2025, driven by market momentum. The report highlights optimism towards AI applications, IP monetization, and mergers and acquisitions as key growth areas for 2025 [1][8]. - AI applications are expected to focus on new investment mappings and data tracking for mature applications, particularly in the multimodal industry direction. Companies with IP advantages and full industry chain potential are seen as having monetization opportunities, especially in trendy toys and film content [1][17]. - The report emphasizes the importance of state-owned enterprises in the media sector, particularly in light of the State-owned Assets Supervision and Administration Commission's focus on market capitalization assessments for state-owned enterprises [1]. Summary by Sections Market Overview - The media sector index increased by 1.39% during the week of May 6-9, 2025, with the top-performing sectors being defense and military (6.44%), communication (5.43%), and banking (3.98%) [8][10]. - The report identifies the top five gainers in the media sector: Baotong Technology (24.7%), Huicheng Technology (16.2%), Shengxunda (12.2%), Zhongqingbao (10.4%), and Huawen Group (9.3%) [11]. Subsector Insights - Key focus areas include resource integration expectations with companies like Zhongshi Media, Guoxin Culture, and Guangxi Broadcasting. AI-related companies such as Rongxin Culture and Aofei Entertainment are also highlighted [17]. - In the gaming sector, companies with strong certainty like Shenzhou Taiyue and Kaiying Network are recommended for attention, along with Perfect World and ST Huatuo [17]. - The report also notes significant interest in Hong Kong stocks, particularly Alibaba, Tencent, and Pop Mart, as well as educational leaders like New Oriental and regional leaders with strong earnings elasticity [17]. Key Events Review - Tencent launched the HunyuanCustom video model, which excels in character consistency and multimodal input, achieving industry-leading performance in various metrics [19]. - Lightricks introduced the LTX Video model, boasting 130 billion parameters and a 30-fold improvement in video generation quality compared to existing models, operable on consumer-grade GPUs [19]. Subsector Data Tracking - The report provides insights into the gaming market, highlighting popular upcoming games and their expected performance [20]. - The domestic film market's weekly box office reached approximately 508 million yuan, with top films including "Dumpling Queen" and "Hunting Gold Game" [21]. - The report tracks viewership for series and variety shows, noting the top-ranking series and their respective platforms [25][26].

Investment Rating - The report maintains an "Increase" rating for the media industry, indicating a positive outlook for the sector [4]. Core Insights - The media sector has shown resilience with a 1.39% increase in the CITIC primary media index during the week of May 6-9, 2025. The report highlights optimism towards AI applications, IP monetization, and mergers and acquisitions as key growth drivers for 2025 [1][8]. - AI applications are expected to focus on new investment mappings and data tracking for mature applications, particularly in the multimodal industry direction. IP monetization will target companies with IP advantages and full industry chain potential, with opportunities in trendy toys and film content [1][17]. - The report emphasizes the importance of state-owned enterprises in mergers and acquisitions, especially in light of the State-owned Assets Supervision and Administration Commission's focus on market capitalization assessments for state-owned enterprises [1]. Summary by Sections Market Overview - The media sector's performance is buoyed by market trends, with a notable increase in stock prices for companies like Baotong Technology (up 24.7%) and Huicheng Technology (up 16.2%) during the reporting week [11][18]. - The report identifies the top five gainers and losers in the media sector, highlighting significant fluctuations in stock performance [11][14]. Subsector Insights - Key focus areas include resource integration expectations for companies like Zhongshi Media and Guoxin Culture, AI advancements in firms such as Rongxin Culture and Aofei Entertainment, and gaming companies with strong certainty like Shenzhou Taiyue and Kaixin Network [17]. - The report also highlights the importance of education and state-owned enterprises in the media landscape, with specific companies recommended for investment [17]. Key Events Review - Tencent's launch of the HunyuanCustom video model and Lightricks' release of the LTX Video model are significant advancements in AI video generation, showcasing improvements in efficiency and quality [19]. - The report notes the collaboration between Lightricks and major image platforms for data acquisition, indicating a strategic move towards enhancing AI capabilities [19]. Subsector Data Tracking - The report provides insights into the gaming sector, with popular titles currently available for pre-order, and highlights box office performance for films released during the week [20][21]. - It also tracks viewership data for popular series and variety shows, indicating trends in audience engagement [25][26].

Group 1 - The report maintains a cautiously optimistic view on the Hong Kong stock market, noting marginal improvements in external risks but persistent overall pressure [1] - Short-term signals indicate a phase of easing tariffs between the US and China, with ongoing negotiations that may still have many variables [1][2] - The report highlights the need for incremental capital and policy stimulus for a rebound in the Hong Kong market, with current inflows primarily from the southbound channel [1][2] Group 2 - The report expresses a favorable outlook on AI technology and domestic consumption, suggesting a portion of high-dividend stocks for defensive positioning [2] - AI technology is emphasized due to strong performance in the US tech sector, which boosts global tech narratives, and the launch of a "Tech Enterprise Line" by the Hong Kong Stock Exchange [2] - Domestic consumption remains a key theme for the year, supported by government initiatives to expand consumption and enhance its role in economic growth [2] Group 3 - The report lists a selection of recommended stocks, including Tencent Holdings, Alibaba, XPeng Motors, and others, with detailed financial metrics such as market capitalization and earnings per share [3][10][13][18][30][34][39][44][51][57] - Tencent Holdings is noted for its strong competitive advantages across multiple business areas and its accelerated AI commercialization process [10] - Alibaba is recognized for its leading position in AI large models and cloud computing, with significant growth expected in its cloud business driven by AI demand [13] Group 4 - XPeng Motors is projected to achieve substantial revenue growth, with expected revenues of 99 billion, 168 billion, and 249 billion yuan for 2025, 2026, and 2027 respectively [18] - Horizon Robotics is highlighted for its advanced driving solutions and significant market share growth in the high-level autonomous driving sector [24][25] - Anta Sports is expanding its brand portfolio through acquisitions, which is expected to enhance overall competitiveness and performance [30] Group 5 - Miniso is positioned as a leading global IP retail brand, benefiting from industry growth and international expansion, with a strong focus on self-owned brands [34] - The report anticipates steady growth for the beverage company Mixue, driven by its end-to-end supply chain and brand marketing strategies [39] - Yuehai Investment is focusing on its core water supply business, with significant cash flow improvements expected following the divestment of non-core assets [44] Group 6 - New Energy is expected to see a return to valuation levels due to privatization efforts, with a projected valuation increase of 30% [51] - Innovent Biologics is forecasted to maintain revenue growth driven by its expanding product pipeline and effective cost management [57]

Group 1 - The report indicates that A-share revenue showed a decline in Q1 2025, with a year-on-year decrease of 2.93%, while profit saw a slight recovery with a year-on-year decline of 4.87%. Non-financial sectors experienced a revenue decline of 0.38% but a profit increase of 6.02% [11][12][19] - The report highlights that the main contributors to profit in Q1 2025 were the metal materials and mining, agricultural products, and comprehensive finance sectors, while the banking, coal, real estate, and oil and gas sectors were significant detractors [12][30] - The report notes that the overall ROE for A-shares continued to decline in Q1 2025, with over half of the secondary industries having ROE levels below the historical 40th percentile [44][48] Group 2 - The report identifies that the sectors with the most significant upward adjustments in profit expectations post-Q1 2025 earnings announcements include comprehensive finance, insurance, and media internet, while most sectors saw downward adjustments [12][74] - The report states that the profit margin for A-shares in Q1 2025 was slightly down, with the overall margin at 17.63%, indicating that many industries remain at historical lows [51][54] - The report emphasizes that the agricultural products sector showed remarkable performance with a profit growth rate of 2051.8% in Q1 2025, significantly contributing to the overall profit recovery [29][36]

Group 1 - The report emphasizes a return to technology growth in May 2025, focusing on three main investment directions [2][5] - The recommended "golden stocks" for May include companies from various sectors such as technology, environmental services, defense, and healthcare, with detailed financial metrics provided [3][68] - The report highlights the importance of macroeconomic factors such as "loose monetary policy" and "weak dollar" in influencing market styles, favoring small-cap growth stocks [5][6] Group 2 - For the computer sector, the report recommends Shen Sanda A, citing its strong position in AI infrastructure and data services, with expected revenue growth driven by government and state-owned enterprise demand [10][11] - In the environmental services sector, Hanlan Environment is highlighted for its potential revenue growth and improved cash flow due to ongoing debt resolution and operational efficiency [15][16] - The defense sector's Steel Research High-tech is projected to benefit from increasing market demand for high-temperature alloys, with significant profit growth anticipated [20][23] Group 3 - The report identifies Xiaoshangpin City in the commerce sector as a key player in the small commodity trade, benefiting from the growth of the Yiwu market and new business opportunities in cross-border e-commerce [29][31] - Horizon Robotics is noted for its advanced autonomous driving solutions, with a significant market opportunity as the penetration of high-level autonomous vehicles increases [36][40] - BeiGene is recognized for its innovative drug pipeline, particularly the growth of its core product, with expectations of substantial revenue increases in the coming years [44][45] Group 4 - The report discusses the electronic sector's Jingzhida, which is positioned to capture market share in storage testing machines, with significant growth potential as domestic demand increases [54][55] - In the new energy sector, Sanhua Intelligent Control is highlighted for its strategic partnerships with major automotive manufacturers, anticipating strong profit growth driven by electric vehicle demand [56][57] - Huichuan Technology is noted for its advancements in automation and robotics, with expectations of increased market share and profitability as the industry recovers [62][63]

Group 1: Electronic Sector - The electronic sector's Q1 performance was strong, driven by AI demand, consumer electronics subsidies, and automotive sales growth, with companies like Shenghong Technology and Huidian Co. showing significant earnings growth [2][14][15] - TSMC plans to start mass production of 2nm chips in the second half of the year, with performance improvements of 10-15% and power consumption reductions of 25-30% compared to N3E [2][14] - The report suggests continued focus on high-growth areas such as AI-PCB, SOC chips, and the Apple supply chain, with specific companies recommended for investment [2][14][15] Group 2: Communication Sector - Google's Q1 capital expenditure increased by 43% year-on-year, indicating strong demand for AI computing and alleviating concerns about reduced capital spending among North American cloud providers [3][40] - New Yi Sheng and Zhongji Xuchuang reported significant revenue growth in Q1, driven by AI computing demand and cost reduction strategies, with the overall industry revenue increasing by 48% [3][40] - China Mobile's Q1 revenue showed a slight increase, with cloud services expected to become a new growth driver for operators [3][44] Group 3: Computer Sector - ByteDance launched the Agent platform for internal testing, which is expected to leverage AI capabilities for various applications, indicating a trend towards AI integration in business processes [4][49] - The report highlights the resilience of the AI industry chain and the potential for growth in sectors like smart driving and data elements, with a positive outlook for domestic alternatives due to U.S. tariff policies [4][49] - The report emphasizes the importance of AI applications and the potential for significant market opportunities in various sectors [4][49] Group 4: Media and Internet Sector - The report suggests monitoring the implementation of AI applications and the potential for growth in the gaming industry, particularly in overseas markets [5][5] - Companies like OpenAI and Baidu are making advancements in AI models, indicating a growing trend in AI application development [5][5] - The report recommends focusing on companies that are likely to benefit from mergers and acquisitions in the media and internet space [5][5]

广发证券研报称，从2025年第一季度传媒互联网板块的基金持仓情况看，公募基金对A股传媒行业的配 置比例环比有所提升，传媒板块低配比例有小幅缩窄。结构上看，游戏、互联网、电影院线、动漫板块 的基金配置比例提升，主要系AI产业趋势向好、第一季度票房大盘同比高增提振信心、政策环境趋稳 等。此外，前五大重仓个股市值集中度环比提升。建议继续关注AI对传媒互联网行业带来的业务重构 机会，以及有优质内容和IP在手的公司。 ...

Summary of Conference Call Notes Industry Overview - The discussion primarily revolves around the **media and entertainment industry**, with a focus on the impact of recent policies and technological advancements, particularly in AI and consumer behavior trends [1][4][5]. Key Points and Arguments Policy Signals and Market Trends - Recent government meetings have highlighted important signals that could influence the media sector, emphasizing the need for companies to adapt to these changes [1]. - The market is expected to expand from a national focus to a global one, with significant growth opportunities in international markets following the saturation of domestic markets [2]. Technological Integration - The integration of technology, especially AI, is seen as a crucial factor for the media industry. The evolution of technology from 3G to 4G has previously driven growth, and similar advancements are anticipated with AI [3][4]. - AI is expected to revolutionize various sectors within media, including advertising, film, education, and gaming, by enhancing efficiency and creating new business models [4][12]. Consumer Behavior and New Consumption Trends - The emergence of Generation Z is reshaping consumer preferences, leading to the rise of new consumption patterns in sectors like beauty and gaming [5]. - The success of recent media productions, such as "Nezha" and "Black Myth: Wukong," is attributed to their ability to resonate with audiences on a deeper emotional level, which is essential for driving sales and engagement [6][10]. AI Applications and Industry Impact - AI applications are becoming increasingly prevalent in the media sector, with companies leveraging AI for content creation, advertising efficiency, and consumer engagement [12][20]. - The use of AI tools has shown to significantly reduce costs and improve operational efficiency, particularly in advertising, where companies can generate content more rapidly and effectively [26][27]. Advertising Trends - There is a notable shift in advertising budgets towards high-conversion channels, with social media and performance-based advertising gaining traction over traditional brand advertising [20][22]. - The trend towards high-efficiency advertising is likely irreversible, as companies prioritize return on investment [23]. Future Outlook and Investment Opportunities - The upcoming earnings season is expected to highlight the importance of AI integration and its impact on revenue growth across various media companies [28][29]. - Companies with strong data resources and innovative AI applications, such as Tencent, are anticipated to attract significant investor interest [29][30]. Additional Important Insights - The discussion also touched on the valuation discrepancies between domestic and international tech companies, suggesting that Chinese tech assets are undervalued compared to their global counterparts [31][34]. - The potential for new AI applications and models to emerge in the market is seen as a critical factor for future growth in the media and technology sectors [32][35]. This summary encapsulates the key insights and trends discussed during the conference call, providing a comprehensive overview of the current state and future outlook of the media industry.