Core Insights - The report highlights a slight decline in public fiscal revenue in January-February, with a year-on-year decrease of 1.6%, indicating a broader economic trend [6][8] - Fiscal spending is increasingly directed towards "people's livelihood" areas, with a notable year-on-year growth of 3.4% in public budget expenditure [7][8] - The report emphasizes the government's commitment to a more proactive fiscal policy, with a projected deficit rate of around 4% for the year [8] Macroeconomic Overview - In January-February, the national general public budget revenue was CNY 43,856 billion, down 1.6% year-on-year, with central budget revenue decreasing by 5.8% [6][7] - Local budget revenue showed a slight increase of 2.0% year-on-year, reflecting a mixed fiscal landscape [6] - The contribution of personal income tax to tax revenue growth was significant, achieving a positive contribution of 2.3 percentage points [7] Fiscal Expenditure Analysis - Total public budget expenditure reached CNY 45,096 billion in January-February, with a year-on-year increase of 3.4% [7][8] - Central government expenditure grew by 8.6%, while local government expenditure increased by 2.7% [7] - The report notes a shift in expenditure structure, with a decline in spending on infrastructure and a focus on social security and employment [8] Industry Performance - The report provides insights into industry performance, with coal and basic chemicals showing positive growth, while sectors like telecommunications and computers experienced declines [4] - The overall market indices reflect a mixed performance, with the Shanghai Composite Index closing at 3,369.98, showing no change [3]

Investment Rating - The report assigns an "Outperform" rating to the food and beverage industry [2] Core Insights - The food and beverage sector is entering a performance verification period, with mixed feedback from the recent Spring Sugar and Wine Fair, highlighting increasing brand differentiation [3][4] - The beverage sector, particularly leading soft drink companies, has shown strong performance, while the snack food sector presents investment opportunities amid industry transformations [4][5] Market Review - The food and beverage sector experienced a decline of 4.0% last week, ranking 27th among the Shenwan first-level industries. The soft drink and beer sub-sectors performed relatively better with declines of 0.3% and 1.1%, respectively, while other alcoholic beverages and dairy products saw larger declines of 5.2% and 6.4% [4][13] - As of March 21, the valuation (PE-TTM) for the liquor sector was 20.3X, while the overall food and beverage sector stood at 21.2X [4][26] Industry Data - In January-February, the production of liquor (65 degrees, commodity volume) totaled 663,000 kiloliters, down 11.2% year-on-year; beer production was 5.261 million kiloliters, down 4.9%; and wine production was 15,000 kiloliters, down 25.0% [7][28] - The retail sales of consumer goods reached 83,731 billion yuan, with a year-on-year growth of 4.0%, including a 4.3% increase in catering revenue and a 5.5% increase in tobacco and alcohol sales [7][28] - The Spring Sugar and Wine Fair saw a subdued atmosphere, with over 6,600 exhibitors and an exhibition area of 325,000 square meters, indicating a shift in focus towards inventory management and cash flow recovery among liquor businesses [7][28] Company Performance - Leading soft drink companies like Dongpeng Beverage reported impressive growth, with revenue and net profit increasing by 40.6% and 63.1% year-on-year, respectively. The company also expanded into coffee and tea beverages [7][28] - The snack food sector is witnessing transformations, with major players adapting to market demands and enhancing their channel strategies. Companies like Wanjin Group and Three Squirrels are expanding their store formats and product offerings [7][28] - In the beer sector, there are opportunities for recovery among leading brands like Qingdao Beer, particularly in light of low base effects [7][28]

Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for its stock performance in the near future [3][7]. Core Views - The company is expected to benefit from policy incentives related to deep-sea technology and internal growth from a recent capital increase project, which will enhance its operational capacity and performance certainty for 2025 [5][10]. - The capital increase project, approved in December 2024, aims to raise 3.5 billion RMB to lease 29 multi-purpose pulp carriers and build a 65,000-ton semi-submersible vessel, which is anticipated to significantly boost the company's profitability and market share in high-end sectors [10]. Financial Summary - The company’s projected revenue for 2024-2026 is as follows: - 2024: 15,689 million RMB - 2025: 18,457 million RMB - 2026: 20,806 million RMB - The expected net profit for the same period is: - 2024: 1,480 million RMB - 2025: 1,923 million RMB - 2026: 2,234 million RMB - The earnings per share (EPS) forecast is: - 2024: 0.54 RMB - 2025: 0.70 RMB - 2026: 0.81 RMB - The company’s price-to-earnings (PE) ratio is projected to decrease from 13.2 in 2024 to 8.7 in 2026, indicating improving valuation metrics [9][11].

Investment Rating - The industry is rated as "Outperform" [2][67] Core Viewpoints - The social services sector has seen a 2.49% increase in the last two trading weeks, outperforming the CSI 300 index by 3.23 percentage points, ranking 9th among 31 sectors [2][17] - The issuance of the "Consumption Promotion Special Action Plan" is expected to restore consumer confidence and address key issues hindering consumption [5][54] Summary by Sections Industry Performance - In the last two trading weeks (March 10-21, 2025), the Shanghai Composite Index fell by 0.23%, while the CSI 300 dropped by 0.74%. The social services sector rose by 2.49%, outperforming the CSI 300 [17][24] - Among sub-sectors, hotel and catering saw the highest increase at 5.00%, followed by tourism and scenic spots at 4.98% [21][24] Market Dynamics - The "Consumption Promotion Special Action Plan" aims to expand domestic demand and enhance consumer willingness by addressing prominent consumption constraints [5][54] - Retail sales data for January-February 2025 showed a year-on-year growth of 4.0%, with total retail sales reaching 83,731 billion yuan [5][54] Investment Recommendations - Companies with strong growth potential include Huangshan Tourism, Lijiang Co., Songcheng Performance, and others in the travel and related industries [5][54] - Hotel brands benefiting from the recovery of business travel include Junting Hotel, Jinjiang Hotel, and Shoulu Hotel [5][54] Company Announcements - Lijiang Co. reported a revenue of 808 million yuan for 2024, a year-on-year increase of 1.19%, with a net profit of 211 million yuan [41] - Jiuhua Tourism announced a revenue of 764 million yuan for 2024, reflecting a growth of 5.64% [41] Travel Data Tracking - Domestic travel has largely recovered post-pandemic, with significant increases in international travel due to relaxed policies [44][45] - The number of inbound tourists to Shanghai reached 6.71 million in 2024, a year-on-year increase of 84% [35]

Core Insights - The report highlights the accelerating demand for hydrogen energy in China driven by energy conservation and carbon reduction needs, with significant policy support from both domestic and international fronts [5][6][7] - The securities industry is expected to see a net profit growth of 9.8% year-on-year in 2024, supported by low base effects and policy boosts, particularly in proprietary investment and wealth management [9][11] Hydrogen Energy Sector - The demand for hydrogen energy in China is accelerating due to energy conservation and carbon reduction needs, with the EU's FEU and CBAM policies set to officially take effect, creating clear demand for hydrogen-based fuels in shipping and chemical sectors [5][6] - The European legislation aims to reduce greenhouse gas emissions significantly by 2030 and achieve carbon neutrality by 2050, with specific measures like CBAM and FEU encouraging renewable fuel applications [5] - The Chinese government has issued action plans to promote hydrogen energy applications across various industries, indicating a shift towards hydrogen as a key industrial raw material [6][7] - The cost of green hydrogen production is expected to decrease due to falling renewable energy costs, establishing a foundation for the growth of hydrogen applications in China [7] Securities Industry - A total of 21 listed securities firms have pre-disclosed their 2024 performance, with 20 firms expecting profit increases, indicating a positive outlook for the sector [9][11] - The average daily trading volume for stock funds is projected to increase by 24.57% year-on-year, reflecting a recovery in market activity [10] - The asset management business is expected to expand, with the total asset management scale of securities firms reaching 6.32 trillion yuan, a 6.67% increase from the beginning of the year [10] - The report suggests focusing on securities firms with strong financial technology layouts and wealth management capabilities, which are likely to show more performance elasticity [9][13]

Investment Rating - The industry investment rating is "Outperform the Market" [1][25]. Core Viewpoints - The consumer data for January and February 2025 shows a positive trend, with retail sales reaching 83,731 billion yuan, a year-on-year increase of 4.0%, indicating initial success of consumption-boosting policies [3][4]. - The "Special Action Plan to Boost Consumption" has been introduced, aiming to provide multi-dimensional support for consumption growth, which is expected to stabilize consumer confidence and enhance market quality [4][3]. - Various data points indicate stable performance, with the service industry production index growing by 5.6% year-on-year in January and February 2025, and the service PMI at 50.3% and 50.0% respectively [4][3]. Summary by Sections Domestic Macro Data - Retail sales in January and February 2025 increased by 4.0% year-on-year, with catering revenue up by 4.3% [1][4]. - The service sector PMI for January and February was 50.3% and 50.0%, respectively, indicating stable business activity [1][4]. Investment Recommendations - Focus on companies likely to benefit from the recovery in tourism and travel demand, such as Lingnan Holdings and Zhongxin Tourism [3]. - Companies in the business and exhibition sector, like Miao Exhibition, are expected to benefit from the recovery in business travel [3]. - Other recommended companies include Tianmu Lake, Lijiang Co., Songcheng Performing Arts, and various hotel chains that will benefit from the recovery in travel and entertainment [3].

Investment Rating - The report maintains an "Accumulate" rating for the company [1][4] Core Views - The company reported a revenue of RMB 808 million for 2024, a year-on-year increase of 1.19%, while the net profit attributable to shareholders was RMB 211 million, a decrease of 7.27% [4][7] - The report anticipates performance improvement from new project expansions, particularly the upgrade of the cable car system, which is expected to enhance peak season capacity [4][7] - The company has a stable dividend policy, proposing a cash dividend of RMB 3.5 per 10 shares, reflecting a commitment to shareholder returns [7] Financial Summary - Revenue projections for the company are as follows: RMB 854 million in 2025, RMB 913 million in 2026, and RMB 955 million in 2027, with growth rates of 5.6%, 6.9%, and 4.6% respectively [6][8] - The expected earnings per share (EPS) for 2025, 2026, and 2027 are RMB 0.42, RMB 0.46, and RMB 0.50, with corresponding price-to-earnings ratios of 23.1, 20.9, and 19.4 [4][6] - The EBITDA for 2024 is projected at RMB 382 million, with an expected increase to RMB 409 million in 2025 [6][8] Operational Insights - The company’s cable car operations received 6.6684 million visitors in 2024, an increase of 8.94% year-on-year, with significant growth in smaller cable car usage [7] - The hotel segment faced challenges, with a revenue decline of 11.09% year-on-year, attributed to the opening of a new hotel that incurred startup costs [7] - The introduction of visa-free entry for ASEAN tourists is expected to boost tourism in the region, positively impacting the company's performance [7]

Core Insights - The report highlights the potential benefits for the aviation transportation sector due to the recent issuance of the "Consumption Promotion Special Action Plan" by the central government, which aims to expand cultural, sports, and tourism consumption [4][6] - The report emphasizes that regional air travel demand, particularly for regional airlines focusing on tourism-rich areas, is expected to gradually increase as GDP per capita rises [4][6] Industry Overview - The report notes that over 70% of domestic airports in China are regional airports, yet they only account for 6% of total passenger throughput [4][5] - In 2024, there are 263 domestic transport airports in China, with 186 of them (70.72%) having an annual passenger throughput of less than 2 million [4][5] - The passenger throughput for regional airports has remained stable at around 90 million in the past five years, with 2024 projected to see approximately 9.05 million passengers [5][6] Market Dynamics - The report identifies that in 2024, Huaxia Airlines holds the largest market share in the regional aviation sector at 13.4%, followed by China Eastern Airlines (12.9%) and China Southern Airlines (10.6%) [7] - The top ten airlines in the regional aviation market collectively account for 69.3% of the market share [7] Regional Distribution - Regional airports are distributed across 28 provinces in China, covering over 170 cities, with the highest concentrations in the Southwest and Northwest regions [6] - The report suggests that the demand for regional air travel in central and western China is expected to grow steadily due to the government's focus on promoting tourism [6]

Investment Rating - The industry investment rating is "Outperform the Market," indicating that the industry index is expected to perform better than the benchmark index over the next 6-12 months [10]. Core Insights - The report highlights that China Unicom has taken the lead in enhancing computing power, fully embracing AI, and is expected to undergo a value reassessment due to its technological transformation [1]. - The AI wave is anticipated to significantly benefit telecom operators from the growth in intelligent computing business and value reassessment, with a recommendation to focus on the three major operators: China Mobile, China Telecom, and China Unicom [3]. - The report emphasizes that the intelligent computing business has become a crucial driver of revenue growth for China Unicom, with a projected revenue of RMB 389.6 billion in 2024, reflecting a year-on-year increase of 4.6% [5]. Summary by Sections Investment Recommendations - The report suggests that telecom operators will benefit from the intelligent computing business, leading to revenue growth and value reassessment, recommending attention to the three major operators: China Mobile, China Telecom, and China Unicom [3]. Performance Metrics - China Unicom's revenue for 2024 is projected to be RMB 389.6 billion, a 4.6% increase year-on-year, with a total profit of RMB 25.1 billion and a net profit of RMB 9 billion, up 10.5% year-on-year [5]. - The intelligent computing business revenue accounted for 24% of service revenue, growing by 9.6% year-on-year, while cloud revenue reached RMB 68.6 billion, up 17.1% year-on-year [5]. Capital Expenditure Trends - China Unicom's capital expenditure for 2024 is expected to be RMB 61.37 billion, a decrease of 17% year-on-year, while computing power investment is projected to increase by 19% [5]. - The company plans to further reduce fixed asset investment to RMB 55 billion in 2025, a decline of 10.38%, while continuing to increase computing power investment by 28% [5]. Industry Landscape - The report notes that the three major telecom operators are increasing their computing power infrastructure, with a total of 830,000 data center racks and a computing power scale exceeding 50 EFLOPS, doubling year-on-year [5]. - The demand for AI computing is expected to reshape the industry, transitioning telecom operators from traditional network providers to technology service companies, which may lead to a value reassessment [5].

Investment Rating - The industry investment rating is "Outperform the Market," indicating that the industry index is expected to perform better than the benchmark index over the next 6-12 months [14]. Core Insights - The recent issuance of the "Special Action Plan to Boost Consumption" by the central government is expected to stimulate travel demand, particularly benefiting the regional aviation sector, especially in areas with unique tourism resources [1]. - The report suggests focusing on the leading regional airline, Huaxia Airlines, which holds a significant market share [3]. Summary by Sections Industry Overview - Over 70% of domestic airports in China are regional airports, yet they account for only 6% of passenger throughput. Regional aviation refers to short-distance, non-mainline routes between small and medium-sized cities, typically using aircraft with fewer than 110 seats and flying distances of 600-1200 kilometers [5]. - In 2024, there are 263 transport airports in mainland China, with 186 airports having an annual passenger throughput of less than 2 million, representing 70.72% of the total. These airports collectively handled 90.49 million passengers, accounting for only 6.2% of total civil aviation throughput [5]. Market Dynamics - Passenger throughput at regional airports has remained stable at around 90 million over the past five years. The throughput figures from 2019 to 2024 are 92.49 million, 94.16 million, 96.92 million, 71.94 million, 88.72 million, and 90.49 million respectively [8]. - In 2024, regional airports are expected to handle nearly 1 million takeoffs and landings, representing about 9.5% of total domestic airport operations, with a year-on-year growth of 3.8% [5]. Regional Distribution - Regional airports are distributed across 28 provinces in China, covering over 170 cities. The top three regions with the most regional airports are Southwest (41), Northwest (41), and Central South (29) [5]. - The report highlights that the current regional aviation demand is primarily concentrated in the central and western regions, which are rich in tourism resources. The government's new consumption plan is expected to enhance travel demand in these areas [5]. Competitive Landscape - In 2024, Huaxia Airlines leads the regional aviation market with a market share of 13.4%. The top ten airlines in the regional aviation market include China Eastern Airlines (12.9%), Southern Airlines (10.6%), and others, with the top ten airlines collectively holding 69.3% of the market [5][7].