Core Viewpoint - The revaluation of Chinese assets is driven by technological innovation, macroeconomic policies, industrial environment, and valuation levels, with a particular focus on AI technology as a significant catalyst for change [2][3][4]. Group 1: Drivers of Asset Revaluation - Technological innovation, exemplified by DeepSeek in the AI sector, is a key factor driving the revaluation of Chinese assets, showcasing China's capabilities in manufacturing and technology [2]. - The macroeconomic policy environment is improving, with the government signaling a shift to a "dual easing" cycle, which is expected to stabilize the economy and improve corporate profitability [3]. - Industrial policies are revitalizing market confidence, particularly in the private sector, which is crucial for economic growth and investment [3]. Group 2: Valuation Characteristics - Current asset valuations in China are at historical lows, with broad indices and major industries undervalued compared to international peers, creating an attractive investment opportunity [4]. - The combination of low valuations and improving fundamentals is drawing global investors to reassess the investment value of the Chinese market [4]. Group 3: International Market Context - The global market's adjustments, including a weakening dollar and volatility in U.S. stocks, are enhancing the comparative advantages of Chinese equities [5][6]. - The current economic uncertainty in the U.S. is prompting capital to flow out of American markets, potentially benefiting emerging markets like China [6][7]. Group 4: AI Sector Potential - The AI sector in China is characterized by low-cost advantages, an open-source ecosystem, and ongoing application innovations, indicating significant growth potential [8][9]. - The transition from concept validation to commercial realization in AI is expected to drive performance in the next 1-3 years, marking a shift towards earnings-driven investment [9]. Group 5: Investment Opportunities - Three categories of industries are identified for potential investment: those driven by policy stimulus, those with cleared supply-side issues, and those with clear demand-side support [10][11][12]. - A phased investment strategy is recommended, focusing on sectors with immediate policy impacts, followed by those with supply-side adjustments, and finally, long-term growth sectors in technology [12].

Group 1 - The core viewpoint of the report emphasizes the investment strategy of "Technology + Consumption" for 2025, with technology already forming a consensus expectation while the consumption aspect still has potential to be explored [1][9]. - The report identifies two key expectation gaps: the first being that even with weak fiscal expansion, retail sales (社零) will exhibit higher elasticity [2][12]. - The report anticipates that as the fiscal spending cycle transitions from a contraction phase in 2023-2024 to a weak expansion phase in 2025, retail sales will show significant upward elasticity [2][12]. Group 2 - The second expectation gap highlights the easing of local debt pressure on consumption, indicating that provinces with higher debt burdens will see more pronounced rebounds in retail sales in categories such as jewelry, clothing, automobiles, and cosmetics [3][18]. - The report suggests that the market may experience short-term consolidation due to high market sentiment, profit-taking, and the calendar effect of the Two Sessions, but the core driving force of the current market remains unchanged [20][21]. - Industry allocation recommendations include four key sectors: (1) Technology growth focusing on AI and autonomous control, (2) Consumption driven by policy and endogenous recovery, (3) Cost improvement sectors, and (4) Structural opportunities in overseas markets [21][22].