Core Viewpoint - The article highlights the significant increase in influenza cases and the potential investment opportunities in related products such as vaccines, diagnostic tests, and medications due to the rising demand driven by the flu season [4][5][6]. Group 1: Influenza Situation - The incidence of influenza-like illness (ILI) has risen, with southern provinces reporting an ILI percentage of 4.6% in week 44 of 2025, up from 4.1% the previous week and higher than the same period in 2022 and 2024 [4]. - Northern provinces reported an ILI percentage of 5.1%, also showing an increase from 3.7% the previous week and higher than the same period in previous years [4]. - The flu season in 2025 is expected to be more severe than in previous years, with a notable change in circulating strains, particularly A(H3N2), which may increase the risk of breaking through herd immunity [4]. Group 2: Investment Opportunities - **Influenza Vaccines**: The low penetration rate of flu vaccines in China presents a significant growth opportunity as demand is expected to rise with the flu season approaching [5]. - **Virus Testing**: The demand for rapid and accurate diagnostic tests for respiratory viruses is anticipated to grow, benefiting companies that offer such testing products [6]. - **Cold and Specialty Medications**: The demand for cold medications is expected to increase in Q4 2025, with potential sales exceeding market expectations due to the rising flu cases and the clearing of social inventory formed during the COVID-19 pandemic [6].

Core Insights - The report from Everbright Securities indicates a significant rise in influenza cases as temperatures drop in autumn 2025, with a notable increase in public and market attention towards flu prevention and treatment products [1][2] Group 1: Influenza Trends - The incidence of influenza-like illness (ILI) has increased, with southern provinces reporting an ILI rate of 4.6% in week 44 of 2025, up from 4.1% the previous week and higher than the same period in 2022 and 2024 [1] - Northern provinces reported an ILI rate of 5.1% in the same week, also showing an increase from 3.7% the previous week and higher than the rates in 2022, 2023, and 2024 [1][2] Group 2: Investment Opportunities - **Influenza Vaccines**: The low penetration rate of flu vaccines in China presents a significant growth opportunity, especially with the expected increase in demand during the flu season. Companies to watch include Hualan Biological Engineering (301207.SZ), Baike Biological (688276.SH), and Jindike (688670.SH) [3] - **Virus Detection**: The demand for rapid and accurate diagnosis of respiratory infections is expected to boost the performance of companies in this sector. Recommended companies include Innotec (688253.SH), Shengxiang Biological (688289.SH), Botao Biological (688767.SH), and Wanfu Biological (300482.SZ) [4] - **Cold and Specialty Medicines**: The demand for cold medicines is anticipated to rise in Q4 2025, with potential sales and delivery improvements. Companies to consider include Zhongsheng Pharmaceutical (002317.SZ), China Resources Sanjiu (000999.SZ), Kangyuan Pharmaceutical (600557.SH), and others [4]

Macro Analysis - The 2025 Q3 monetary policy execution report affirms the resilience of the domestic economy and alleviates concerns about domestic inflation and global economic recession. The report suggests that monetary policy should focus on "counter-cyclical and cross-cyclical adjustments," indicating a potential increase in easing measures [1] - The report highlights the need to monitor the implementation of policies supporting personal credit repair, as credit policy remains a key focus area [1] - The central bank's concerns regarding the RMB exchange rate have lessened, with a greater emphasis on the positive impact of exchange rate stability on the economy and markets [1] Industry Research - The gradual improvement of the capacity electricity price mechanism is a continuous benefit for the energy storage industry. Inner Mongolia maintains a high level of energy storage subsidies, ensuring considerable energy storage installation growth in the coming year [2] - The market has high expectations for domestic energy storage installations next year, with a focus on monitoring the production of energy storage cells in December and January, as well as upcoming bidding and installation situations [2] - The overall industry remains in a state of sustained prosperity, with investment opportunities particularly in energy storage system integrators, PCS companies, and tight supply-demand segments within the energy storage cell supply chain [2] Company Research - The company reported a revenue of $1.324 billion in Q3 2025, representing a year-on-year increase of 13%, and a net profit of $74 million, up 9% year-on-year. The net profit forecast for 2025 is maintained at $171 million [4] - The company has made substantial progress in the high-speed interconnect field, gaining customer recognition, which is expected to drive accelerated growth in its data center business. The net profit forecasts for 2026 and 2027 have been raised by 23% and 29% to $297 million and $400 million, respectively [4] - The company is anticipated to continue benefiting from the growth in AI data centers and automotive cable demand, maintaining a "buy" rating [4] Health Sector Insights - There is a noticeable increase in flu-like cases, which may heighten public and market interest, potentially driving demand for flu vaccines, virus testing, and related medications [3]

Investment Rating - The report maintains an "Overweight" rating for the pharmaceutical and biotechnology industry [1]. Core Insights - The incidence of influenza-like illness (ILI) has increased, with southern provinces reporting an ILI percentage of 4.6% in the 44th week of 2025, up from 4.1% the previous week and higher than the same period in 2022 (3.1%) and 2024 (3.3%), but lower than 2023 (5.9%). Northern provinces reported an ILI percentage of 5.1%, also higher than previous years [3][4]. - The report indicates a significant rise in flu cases compared to historical levels, suggesting a potential risk for a severe flu season in 2025 due to changes in circulating strains and the possibility of breaching herd immunity [3]. Summary by Sections Influenza Vaccine - The report highlights the low penetration rate of influenza vaccines in China, suggesting that the anticipated rise in flu cases could lead to increased demand for vaccines. Companies such as Hualan Biological Engineering, Baike Biological, and Gendik are recommended for investment [4]. Virus Detection - There is an expected increase in demand for respiratory virus diagnostic products due to the rise in respiratory infections. Companies with relevant products, such as Innotec, Shengxiang Biological, Botao Biological, and Wanfu Biological, are highlighted as potential beneficiaries [4]. Cold and Specialty Drugs - The demand for cold medications is expected to rise in Q4 2025, with sales likely exceeding market expectations. Companies such as Zhongsheng Pharmaceutical, China Resources Sanjiu, Kangyuan Pharmaceutical, Fangsheng Pharmaceutical, Jichuan Pharmaceutical, Yiling Pharmaceutical, Dongyangguang Pharmaceutical, Jian Kangyuan, and Te Yi Pharmaceutical are recommended for investment [5].