Investment Rating - The report maintains an "Increase" rating for the industry, indicating a positive outlook for the sector in the next six months [1]. Core Insights - The report highlights the inclusion of companies such as JD Industrial, Leshush, and Xirui in the Hong Kong Stock Connect list, while companies like Beijing Capital Airport and Fenbi were removed [4]. - JD Industrial is recognized as a leading provider of industrial supply chain technology and services in China, with a projected revenue of 23.95 billion yuan in 2025, reflecting a year-on-year growth of 17.4% [11]. - Leshush, a leading brand in Africa for sanitary products, is expected to generate revenue of $454 million and a net profit of $95 million in 2024, with a compound annual growth rate (CAGR) of 19% for revenue from 2022 to 2024 [9]. - Xirui, a pioneer in the global private aviation sector, anticipates delivering 731 aircraft in 2024, with projected revenue of $1.197 billion and a net profit of $121 million, showcasing a CAGR of 19.5% from 2020 to 2024 [10]. Summary by Sections Industry Overview - The report discusses the adjustment of the Hong Kong Stock Connect list, emphasizing the strategic inclusion of companies that are positioned for growth in emerging markets and sectors [4][9][10]. Company Performance - JD Industrial is positioned as the top player in China's MRO procurement service market, benefiting from the digitalization trend in industrial supply chains [11]. - Leshush's market share in Africa for baby diapers and sanitary napkins is 20.3% and 15.6%, respectively, indicating strong competitive positioning [9]. - Xirui's diverse revenue streams from aircraft sales, customization, and after-sales services enhance its market resilience and customer loyalty [10]. Market Trends - The report notes the significant growth potential in the industrial products circulation market in China, driven by the low digital penetration and increasing standardization of enterprise procurement [11]. - The expansion of the ultra-high-net-worth population globally is expected to structurally increase demand for private aviation services, benefiting companies like Xirui [10].

Core Viewpoint - The importance of strengthening domestic circulation and expanding the domestic consumption market has become increasingly prominent in the context of ongoing pressures on external demand due to the "reciprocal tariffs" incident in April 2025, leading to potential new opportunities in the consumer sector [2][6]. Product Operation - As of March 31, 2025, the stock allocation of the "Quanguo Consumption Opportunity" fund is 72.86% of its net asset value, with Hong Kong stocks accounting for 15.83%. The fund has increased its allocation to domestic consumption sectors such as automobiles, beer, and pharmaceuticals, while maintaining previous investments in internet and high-end manufacturing sectors [3]. - The top ten holdings of the fund include Tencent Holdings (5.51%), CATL (3.47%), Midea Group (3.23%), and others, reflecting a diversified investment strategy focused on high-potential sectors [3]. Market Perspective - Economic indicators such as industrial added value, retail sales of consumer goods, fixed asset investment, and manufacturing investment have shown slight acceleration in growth during the first quarter of 2025, indicating a continuation of the recovery trend from the previous quarter [4][5]. - Despite ongoing structural pressures, signs of recovery are emerging, with positive changes in metrics like express delivery orders, travel numbers, and hiring wages, suggesting a potential for more positive data in the future [5]. Impact of Tariff Policies - The recent tariff policies have highlighted the importance of domestic demand, making it essential to enhance internal circulation and expand the domestic consumption market. The introduction of the "Special Action Plan to Boost Consumption" in March 2025 is expected to gradually enhance consumer capacity [6][7]. Future Investment Focus - The company plans to focus on fast-growing and high-prospect emerging consumption sectors, including: - Products and services that enhance emotional value for consumers, such as cultural and creative industries, pet economy, and silver economy [8]. - Integration of technological innovations, with AI and other technologies creating new consumption scenarios [8]. - Products that align with mature consumer perspectives, emphasizing cost-effectiveness and value [8]. - The potential for growth in the overseas consumption sector, as Chinese consumer goods companies leverage their competitive advantages in international markets [8].