Group 1: Consumer Trends - The current consumer sector is showing three main trends: rational consumption, quality upgrades, and consumption alternatives coexisting [1] - There is a growing willingness to pay for emotional value and spiritual satisfaction in lifestyle choices [1] - Technological advancements are creating new consumption directions, presenting long-term structural "new consumption" opportunities [1] Group 2: Investment Recommendations - It is suggested to gradually shift from a balanced allocation to a more flexible allocation in consumer investments [1] - Defensive sectors include consumer internet, undervalued high-return dairy products, and mass catering, which are expected to stabilize first [1] - Cyclical sectors such as restaurant supply chains, alcoholic beverages, human resource services, and hotels are recommended for flexible allocation [1] Group 3: Electric Meter Industry - The annual demand for electric meter tenders is expected to remain around 90 million units, with a peak replacement cycle extending until 2026 [2] - Prices are continuing to decline, with an overall month-on-month decrease of approximately 9.6% [2] - Electric meter companies have shown good dividend payment history, and their valuations are currently considered low [2] Group 4: Micro-Enterprise Investment Landscape - The micro-enterprise investment style may show diminishing marginal advantages, but there are still structural opportunities [3] - Policy support for small and micro technology enterprises is expected to underpin liquidity expectations [3] - The market may see a shift towards high-growth quality small and micro enterprises as liquidity conditions remain favorable [3]

Core Viewpoint - The report from CITIC Securities indicates a clear direction for Chinese policies aimed at boosting domestic demand, with expectations of improved consumer preferences for investment in the context of increased market volatility and uncertainty [1][4] Group 1: Consumer Trends - Current consumer trends are characterized by three main lines: rational consumption, quality upgrades alongside affordable alternatives; spending on emotional satisfaction and quality of life; and new consumption directions driven by technological advancements [1] - The traditional consumption sector is showing signs of recovery, particularly in essential goods, with Q2 2025 expected to be a bottoming window for many consumer industries [1][2] Group 2: Consumption Data and Performance - In the first half of 2025, consumer demand and price pressures are easing, with a notable rise in "quality-price ratio" consumption and strong demand for leisure and entertainment [2] - The recovery in consumer data, combined with strong performance in certain sectors, has led to increased marginal interest from investors in the consumer industry, although many sub-sectors remain at reasonable valuation levels [2] Group 3: Structural Changes and New Consumption - Four slow-moving variables are shaping the macroeconomic landscape in China: aging population, smaller households, AI-driven production changes, and complex external environments, leading to structural growth opportunities for new consumption companies [3] - New consumption characteristics are emerging from companies that meet consumer demands for emotion, health, and value, supported by innovations in AI and biotechnology [3] Group 4: Policy Impact and Short-term Outlook - The short-term recovery of consumer-related industry valuations is heavily reliant on overall expectations for the domestic macroeconomic environment, with 2025 potentially being a turning point [4] - Strengthening internal circulation and expanding domestic consumption markets are becoming necessary choices, with policy effects contributing to the ongoing recovery in both goods and service consumption [4]