Macro and Strategy - The report highlights that special new local government bonds have exceeded 800 billion, with net financing of government bonds and new local bonds reaching 9.2 trillion, surpassing the same period last year by 5 trillion [7][8] - The report indicates that the net financing of local bonds for the 31st week was 2,425 billion, and for the 32nd week, it was 828 billion, with a cumulative total of 5.2 trillion, exceeding last year's total by 3.1 trillion [7][8] Agriculture Industry - The report notes a new round of beef price increases, with strong support for pork prices, indicating a positive outlook for the livestock sector in 2025 [9][11] - The report provides specific price data, such as the pork price at 14.19 yuan/kg, which is a week-on-week increase of 0.78%, and the price of live chickens at 6.70 yuan/kg, with a week-on-week increase of 0.6% [9][10] - Investment recommendations include livestock, pet consumption, and undervalued leading companies in the breeding chain, with specific companies highlighted for investment [11] Machinery Industry - The report states that the machinery industry index rose by 5.67% in July, outperforming the Shanghai and Shenzhen 300 index by 2.12 percentage points [12] - Key investment focuses include AI infrastructure and humanoid robots, with a recommendation for companies like XCMG and SANY Heavy Industry [12][13] Semiconductor Industry - The semiconductor index increased by 3.08% in July, with the report suggesting a focus on domestic manufacturing supply chains and cyclical recovery in analog chips [16][17] - The report highlights that global semiconductor sales in June reached $59.91 billion, a year-on-year increase of 19.6%, with China’s semiconductor sales at $17.24 billion, a 13.1% increase [16][17] Electric Power and New Energy - The report discusses Apple's commitment to invest an additional $100 billion in the U.S., which may positively impact the supply chain and related companies [19] - Investment recommendations include battery and equipment companies that are expected to benefit from the increased use of steel shell batteries in iPhones [19] Company-Specific Insights - Haida Group is noted for its significant growth in feed sales, achieving a total of 14.7 million tons in the first half of 2025, a 25% year-on-year increase, with market share rising from 8.41% to 9.27% [19] - Far East Horizon reported a stable asset scale with a slight increase in net profit, achieving a net profit of 2.2 billion yuan in the first half of 2025, a year-on-year increase of 3.8% [21][22] - Ninebot's revenue for the first half of 2025 reached 11.74 billion yuan, a 76.1% year-on-year increase, driven by strong sales in electric two-wheelers and lawnmowers [23][24]

Investment Rating - The investment rating for the electric equipment and battery industry is "Outperform the Market" (maintained) [2][7]. Core Insights - Apple has announced an additional investment of $100 billion in the U.S., bringing its total investment in the country over the next four years to $600 billion. This move may positively impact tariff exemptions for the supply chain [3][4]. - The application of steel-shell batteries in iPhones has been increasing, with expectations for significant growth in their deployment. The iPhone 16 series is set to feature one model with a steel-shell battery, while the iPhone 17 series will have two models equipped with this technology [5]. - The price of a single steel-shell battery is projected to reach $9-10, representing an increase of over 50% compared to soft-pack batteries, which will enhance the profitability of battery manufacturers [5]. Summary by Sections Apple Investment Impact - Apple's commitment to invest $100 billion in the U.S. is part of its "American Manufacturing Plan" aimed at integrating more of its supply chain domestically. This could lead to favorable tariff conditions for the industry [3][4]. Steel-Shell Battery Development - The steel-shell battery's advantages include high energy density and excellent heat dissipation. The increasing adoption in Apple's products is expected to benefit leading battery and equipment companies [5]. - The demand for new production lines for steel-shell batteries will likely result in significant order growth for equipment manufacturers, positively impacting their financial performance [5]. Company Focus - The report suggests focusing on Zhuhai Guanyu, a core supplier in Apple's battery supply chain, as it stands to benefit from the increasing application of steel-shell batteries in upcoming iPhone models [5].

Investment Rating - The investment rating for the company is "Buy" with a target price of 29.00 CNY, indicating a potential upside of over 20% from the current price of 21.95 CNY [6]. Core Insights - The report highlights a recovery in capital expenditure in the lithium battery sector, with significant growth expected in battery demand driven by diverse sources, including power and energy storage applications. The global shipment of lithium batteries is projected to grow from 1766 GWh in 2025 to 5154 GWh by 2030, representing a compound annual growth rate (CAGR) of 24% [2]. - The company is positioned to benefit from the increasing adoption of high-strength steel in battery casing, particularly in heavy-duty electric vehicles, which is expected to enhance safety and reduce costs [3]. - The demand for small steel shell batteries in consumer electronics is anticipated to rise due to technological advancements and policy support, leading to an increase in both volume and price for laser welding processes [4]. Summary by Sections Historical Stock Price and Operational Review - The company's stock price has undergone significant fluctuations since its listing, experiencing a peak in December 2021 and a trough in February 2024, with a total decline of over 75% from peak to trough [14]. Current Operations: Diversified Performance and Potential Recovery - The company is expected to see a recovery in performance as it diversifies its operations, with a projected revenue of 36.4 billion CNY, 49.4 billion CNY, and 60.3 billion CNY for the years 2025 to 2027, respectively [4][5]. Lithium Battery Sector: Upward Capital Expenditure and Market Growth - Major lithium battery manufacturers have resumed expansion cycles, with capital expenditures reaching 28.7 billion CNY in Q4 2024, a year-on-year increase of 17%, and 20.6 billion CNY in Q1 2025, up 22% year-on-year [2]. Large Steel Shell Batteries: Enhanced Applications and Market Penetration - The report notes that the application of high-strength steel in battery casings is progressing faster than market expectations, particularly in heavy-duty electric vehicles, which could lead to increased demand for laser welding equipment [3]. Consumer Batteries: Demand and Technological Synergy - The report anticipates a synergistic effect from demand, technology, and policy driving the transition of mobile phone batteries towards higher energy density and replaceable designs, which will likely boost the market for small steel shell battery laser welding [4]. Profit Forecast and Valuation - The company is projected to achieve a net profit of 3.3 billion CNY, 4.5 billion CNY, and 5.7 billion CNY from 2025 to 2027, with a corresponding average PE ratio of 27 for comparable companies in 2026, leading to a target market capitalization range of 9 to 11.3 billion CNY [4][5].

Summary of Key Points from Conference Call Industry Overview - The conference call discusses the **steel shell battery industry**, highlighting its growing adoption driven by **EU environmental regulations** that mandate all products meet lifecycle recyclability standards by **2027** [1][5][25]. - Major companies involved include **Zhuhai Guanyu**, **Lianying Laser**, and **Haopeng Technology**, which are positioned to benefit from the shift towards steel shell batteries in consumer electronics [1][6][24]. Core Insights and Arguments - **Advantages of Steel Shell Batteries**: Compared to traditional aluminum-plastic soft packs, steel shell batteries offer better heat dissipation, higher strength, and flexible structures, enhancing device safety, battery life, and design innovation [1][3][5]. - **Market Demand**: Apple has begun using steel shell batteries in its Pro series and plans to expand this to more models, including ultra-thin and foldable versions. Samsung is also adopting steel shell batteries in its new SS26 model [2][5]. - **Projected Growth**: - Lianying Laser expects new orders in consumer electronics to reach **1.2-1.5 billion yuan** in 2025, with potential to exceed **1.8 billion yuan** in 2026 [1][9]. - Zhuhai Guanyu anticipates its market share in Apple's steel shell battery segment to rise from **10%** in 2024 to over **20%** in 2025 and nearly **40%** in 2026, with revenues projected at **3.5 billion yuan** in 2025 and **5 billion yuan** in 2026 [1][16]. - Haopeng Technology is expected to generate over **6 billion yuan** in revenue in 2025, benefiting from growth in laptops, wearables, and AI products [1][20]. Additional Important Insights - **Impact of EU Regulations**: The EU's environmental legislation is a significant driver for companies like Apple and Samsung to transition to steel shell batteries, which meet the new recyclability standards [5][25]. - **Market Potential Beyond Smartphones**: Other Apple products, such as iPads, computers, headphones, and watches, are also expected to adopt steel shell batteries, potentially creating an additional **2 billion yuan** in demand [11][12]. - **Lianying Laser's Competitive Edge**: As Apple's exclusive supplier, Lianying Laser has a strong position in the laser welding sector, which is crucial for steel shell battery production [13][15]. - **Android Market Potential**: The demand for steel shell batteries among Android manufacturers is significant, with estimates suggesting that **50-60%** of the market could shift to steel shell batteries, representing a market space of **4-4.8 billion yuan** [3][14]. - **Zhuhai Guanyu's Performance**: The company is experiencing a recovery in the consumer electronics sector, with a projected revenue of **12.5 billion yuan** in 2025 and **16 billion yuan** in 2026, driven by new customer acquisitions and increased production capacity [17][18]. Conclusion The steel shell battery industry is poised for significant growth, driven by regulatory changes and technological advancements. Key players like Zhuhai Guanyu, Lianying Laser, and Haopeng Technology are well-positioned to capitalize on this trend, with substantial revenue and market share growth expected in the coming years.