Core Viewpoint - The gaming industry is experiencing a new cycle of prosperity, with both supply and demand sides showing strong growth, benefiting community platforms significantly [1][2][4]. Demand Side - From January to May, the domestic mobile game market in China grew by 20% year-on-year, reaching a market size of 1,411 billion yuan, with mobile games accounting for 1,052 billion yuan of this total [2][4]. - In May alone, the gaming market size was 281 billion yuan, reflecting a 10% year-on-year increase, while the mobile game market size was 212 billion yuan, up 12% year-on-year [2]. Supply Side - The number of domestic game licenses issued from January to June reached 757, marking a 21% year-on-year increase, with June alone seeing 147 licenses issued, a 41% year-on-year increase and the highest monthly figure in 22 years [4][5]. - The frequency of issuing import licenses has been reduced to once a month, with 55 licenses issued from January to June, remaining stable year-on-year [5]. Community Platforms - Major gaming community platforms such as TapTap, Haoyou Kuaibao, and others are expected to benefit from the high user activity in the gaming sector [7]. - TapTap has a monthly active user base of 44.05 million, while Haoyou Kuaibao has around 50 million users, indicating strong engagement in gaming communities [8]. Game Performance - Long-standing games like NetEase's "Identity V" have seen over 50% year-on-year revenue growth, while new games from mid-sized developers have also performed well, exceeding expectations [4][5]. - The top games in revenue rankings are predominantly those launched before 2024, indicating the sustained popularity of established titles [4].

Core Viewpoint - The A-share gaming sector has shown significant strength since April 2023, with the China Animation and Gaming Index rising over 30% from its low point in early April, indicating positive changes in the industry [3][6]. Policy Support and Market Dynamics - The gaming industry has received continuous policy support, with the National Press and Publication Administration issuing 158 game copyright numbers in June 2025, marking a new high since the regulatory pause in 2021 and 2022 [7][9]. - In the first half of 2025, a total of 812 new games were approved, with 757 being domestic games, reflecting a more than 20% increase compared to the same period in 2024, signaling a shift towards high-quality development in the gaming sector [9][10]. - Various provinces and cities have issued policies to support the high-quality development of the gaming and esports industries, with Beijing's recent measures focusing on optimizing reviews and promoting quality content [10]. Leading Companies and Market Performance - The top ten stocks in the Animation and Gaming Index account for 73.41% of the index's weight, with the top five stocks representing 49.05%, indicating that leading companies are likely to benefit more from the ongoing industry reforms [11]. - Notable companies such as Kayi Network, Giant Network, and Sanqi Interactive have seen significant stock price increases since early April, with gains of 30.28%, 106.46%, and 40.53% respectively [14][13]. AI Integration in Gaming - The integration of AI in gaming is reshaping the industry, with companies like Giant Network pioneering AI-driven gameplay, enhancing user experience and product innovation [15][18]. - Sanqi Interactive has developed an AI model named "Xiao Qi," which enhances various operational aspects, including game development and marketing, significantly improving efficiency [19][21]. International Expansion and Cultural Export - The gaming industry is focusing on international expansion, with China's game exports reaching $18.557 billion in 2024, a 13.39% increase year-on-year, marking a new high [25][26]. - Major companies are actively pursuing global markets, with Sanqi Interactive's upcoming titles targeting international audiences, reflecting a strong commitment to globalization [27][29]. Industry Outlook - The combination of supportive policies, AI advancements, and cultural exports positions the domestic gaming industry for a transformative period, potentially leading to a "DeepSeek" moment in the sector [30][31].

Gaming Industry - The issuance of gaming licenses in China remains high, with 757 domestic game licenses issued in the first half of the year, a year-on-year increase of over 20% [1] - Key projects such as "Douluo Dalu: Soul Master Battle" by Kaiying Network and "Endless Cultivation" by Giant Network have received new licenses, indicating a recovery in the gaming sector [1] - The application of AI technology in gaming is becoming clearer, with expectations for more AI-native games to emerge, driving a revaluation of the gaming industry [1] Stablecoins - Hong Kong is accelerating the application of stablecoin policies to address long-standing issues in cross-border payments, aiming to enhance service to the real economy [2] - Stablecoins are seen as a cost-effective alternative in the traditional financial system, with potential to transform payment and capital market activities [2] - The stablecoin industry is expected to enter a period of compliant development as global regulatory policies are implemented [2] Foldable Phones - Honor is set to launch the Honor Magic V5, touted as the world's lightest and thinnest foldable phone, featuring advanced AI capabilities [3] - The Chinese foldable phone market is projected to maintain a 40% global market share, with shipments expected to exceed 17 million units by 2028, reflecting a compound annual growth rate of 19.8% over the next five years [3] - Apple's entry into the foldable phone market is anticipated to boost global sales and drive innovation in the foldable supply chain [3] Regenerative Medicine - Chinese scientists have made a significant breakthrough in regenerative medicine by discovering a key "molecular switch" that regulates mammalian regeneration, marking a major original innovation [4] - The aging population in China is driving clinical demand for regenerative medicine, with technologies like stem cell therapy and 3D bioprinting entering a phase of clinical transformation [4] - The "14th Five-Year Plan" has identified regenerative medicine as a strategic emerging industry, indicating strong government support [4] Innovative Pharmaceuticals - The National Healthcare Security Administration is set to announce measures to support the high-quality development of innovative drugs, which is expected to benefit domestic innovative pharmaceutical companies significantly [5] - The Chinese innovative drug market is projected to exceed 1.22 trillion yuan by 2025, with an annual growth rate of 8.53% [5] - The implementation of policies to support innovative drug development is expected to accelerate the commercialization of new drugs, with 2025 potentially marking a turning point for profitability in the sector [5] Solid Waste Management - A nationwide campaign has been launched to address illegal dumping of solid waste, focusing on hazardous waste and construction debris [6] - The solid waste management industry is experiencing a dual boost from policy support and technological upgrades, with significant market expansion expected [6] - The "14th Five-Year Plan" emphasizes the importance of solid waste management as a pillar of the environmental protection industry [6] AI in Healthcare - Shanghai Ruijin Hospital has open-sourced its RuiPath pathology model, covering seven common cancer types, and initiated a global multi-center plan [7] - The integration of AI technology in healthcare is rapidly transforming the industry, with major tech companies accelerating their investments in AI healthcare solutions [7] - The development of large models in AI is expected to bring revolutionary changes to various medical applications, driving the intelligent upgrade of the healthcare industry [7] Photovoltaic Glass - Major domestic photovoltaic glass companies plan to collectively reduce production by 30% starting in July to alleviate supply-demand imbalances [8][10] - The average net profit of the photovoltaic glass industry has dropped to a historical low, indicating severe profitability challenges [8] - The production reduction is expected to improve market conditions and help companies find a new equilibrium in supply and demand [8][10]

Market Performance - On June 30, 2025, A-shares saw collective gains with the Shanghai Composite Index rising by 0.59%, Shenzhen Component Index by 0.83%, and ChiNext Index by 1.35% [1] - The trading volume in the Shanghai and Shenzhen markets approached 1.5 trillion yuan [1] Sector Performance - Game and defense-related ETFs led the gains, with specific game ETFs and aerospace ETFs increasing by over 5% [2] - The National Press and Publication Administration approved 147 domestic games and 11 imported games, boosting the gaming sector [2] - The military industry is expected to experience a valuation restructuring, benefiting from improved asset quality and larger business scales [2] High Dividend Sector - High dividend sectors experienced a pullback, but there are expectations for supportive policies from the China Securities Regulatory Commission to enhance market confidence [3] - The central state-owned enterprise sector is viewed positively due to ongoing reforms and market management initiatives [3] ETF Trading Activity - The top trading ETF was the Credit Bond ETF with a transaction volume of 18.291 billion yuan, followed by the Shanghai Corporate Bond ETF and Short-term Bond ETF, both exceeding 10 billion yuan [4] - The Asia-Pacific Select ETF had the highest turnover rate at 157.05% [5] Upcoming ETF Issuances - Five new ETFs are set to begin fundraising on July 1, 2025, including those focused on artificial intelligence and aviation [6][7] - The newly listed ETFs will track indices related to artificial intelligence, general aviation, and free cash flow [11][12][14]

Group 1 - The gaming sector is experiencing a strong recovery, with the gaming ETF (159869) surging by 6.28% and all constituent stocks showing positive performance, including significant gains from companies like Giant Network and Kyeing Network [1] - A total of 158 games received approval for release in June, marking a recent high, with notable titles from both domestic and imported categories, indicating a robust pipeline for the industry [1] - Giant Network's game "Space Kill" has introduced AI-native gameplay, enhancing its position in the AI gaming sector, with millions of players participating in various game modes [1] Group 2 - Huaxi Securities highlights that the regular issuance of game licenses reflects ongoing regulatory support for the industry's healthy development, improving supply-side dynamics and injecting new momentum into the market [2] - The stability of policies enhances the predictability of domestic manufacturers' R&D and publishing plans, steering resources towards high-quality and long-term projects [2] - The gaming sector is catalyzed by transformations in AI, content, and commercialization models, with the gaming ETF (159869) tracking the performance of A-share listed companies in the animation and gaming industry, presenting potential investment opportunities [2]

Investment Rating - The report maintains a "Buy" rating for the industry [5][8]. Core Insights - The media industry saw a weekly increase of 3.07%, ranking 18th among industries, outperforming the Shanghai Composite Index and Shenzhen Component Index [11][19]. - A total of 158 game licenses were approved by the National Press and Publication Administration, marking a recent high, with several major titles from various companies receiving approval [2][29]. - The box office for the week reached 479 million yuan, with the top film "酱园弄·悬案" accounting for 51.4% of the total [37][40]. Market Performance - The media industry (Shenwan) increased by 3.07% from June 21 to June 27, 2025, while the Shanghai Composite Index rose by 1.91% and the Shenzhen Component Index by 3.73% [11][19]. - Among the media sector, companies like 欢瑞世纪 and 冰川网络 showed significant gains, with weekly increases of 26.89% and 14.86% respectively [19][20]. Industry Key Data AI Application Data - The estimated download volume for the iPhone app Deepseek was 923,800, down 2.01% week-on-week, while the app 豆包 saw an increase of 1.58% to 2,099,400 downloads [23][24]. - 阿里夸克's downloads increased by 40.55% to 1,414,700, while 腾讯元宝's downloads decreased by 17.70% to 361,300 [23]. Gaming Data - The gaming sector saw a total of 158 licenses approved, with 147 being domestic and 11 imported [28][29]. - Popular games like 王者荣耀 and 和平精英 topped the iOS game sales chart [27]. Film Data - The total box office for the week was 479 million yuan, with "酱园弄·悬案" leading at 246 million yuan [37][40]. - Upcoming films include "侏罗纪世界：重生" and "蜡笔小新：大人王国的反击," which are highly anticipated [38][39]. Industry Key Events and Announcements - Meta launched its third-generation AI glasses, focusing on high-performance features for sports [41]. - 网易有道 open-sourced the "子曰 3" mathematical model, aimed at enhancing AI applications in education [41]. - 巨人网络 introduced a new AI gameplay feature in its game "太空杀," marking a significant innovation in the gaming sector [41].

Group 1 - The National Press and Publication Administration approved 147 domestic online games in June 2025, breaking the previous record of 130 games approved in May 2025 [1] - A total of 766 domestic online games have received approval from January to June 2025, representing a year-on-year increase of 21.97% compared to 628 games in the same period of 2024 [1] - Among the approved games in June, 61 are categorized as casual and puzzle games, accounting for 41% of the total approved games [1] Group 2 - In June, 11 imported games also received approval, maintaining a steady update frequency of one per month for imported games this year [1] - Notable game developers such as Kaineng Network and Lilith Games received approvals for their titles, including "Douluo Dalu: Soul Master Battle" and "Pameng Battle Diary" respectively [1] - Tencent and NetEase both secured approvals for their games, with Tencent obtaining licenses for "Crossfire: Rainbow" and "Tactical Squad: Dawn Assault" [2]