Zhitong Hong Kong Stock Exchange Unravels | The peripheral situation is chaotic, financial stability, and the overall situation has many advantages, and aviation continues to strengthen

[Anatomy Dashboard]

Against the backdrop of clear incremental capital stabilizing the overall situation yesterday, both markets have shown resilience today. Hong Kong stocks opened lower and closed slightly higher by 0.12%.

The situation on the periphery is still quite chaotic. The US is further increasing its pressure on Venezuela, and the Commission has already requested a UN Security Council meeting. Ministry of Foreign Affairs: China supports Venezuela's request to hold an emergency meeting of the UN Security Council. This situation will strain oil supply, with Sinopec (00386) rising more than 3% and Shanghai Petrochemical (00338) rising more than 2%; shipping will also be stimulated. For example, COSCO Marine (01138) and Pacific Shipping (02343) are strong.

The reporter asked that the US has announced the sale of military goods worth 11 billion US dollars to Taiwan, the highest amount in history. Ministry of Foreign Affairs: China firmly opposes it and strongly condemns it. There are also ongoing exchanges of fire between Thailand and Cambodia, etc. Gold and silver are all sustainable concerns. The Shanghai Municipal Administration of Market Supervision announced the acquisition of shares in Shandong Jindu SDIC by Shandong Zhaojin Group. If the acquisition is completed, Zhaojin Mining (01818) is expected to surpass China Gold Group in terms of revenue scale. In addition, the company announced the successful completion of the 33.28 MWp/37.50 MWh optical storage project for the Abuja Gold Mine in Côte d'Ivoire, a key overseas mine, to achieve grid-connected power generation. Today it is up more than 6%.

US stocks aren't optimistic either. Trump is on the rescue, saying that a new chairman of the Federal Reserve will be appointed soon. He is a candidate who agrees with low interest rates. In addition, Trump plans to launch a national stock trading program. The “Trump Account” plan is to provide 1,000 US dollars for newborns to invest in US stocks to accumulate wealth. Bessent pointed out that currently 38% of Americans do not hold any shares, and the goal of the plan is to reduce this ratio to zero. Send money directly into the stock market to boost market profits to stimulate consumption.

An island-wide customs clearance launch event for the Hainan Free Trade Port was held in Haikou on the 18th. He Lifeng, member of the Political Bureau of the CPC Central Committee and Vice Premier of the State Council, attended the event and delivered a speech. He pointed out that the Hainan Free Trade Port will become an important gateway leading to China's opening up to the outside world in the new era. Beneficiaries include Meilan Airport (00357), which raised 4 points in the intraday market; Junda Co., Ltd. (02865): The Danzhou base can import raw materials and equipment through a “zero tariff” policy, which greatly reduces procurement costs; when its products are exported to Southeast Asia, logistics and other costs are also expected to be reduced by about 30%; the company built a battery base in Turkey to enter the European market, and the Oman project also locked in orders from North America, which accounted for more than 50% of overseas sales in 2025. Today it's up nearly 4%.

Referring to the resumption of trading of CICC (03908) yesterday, details of the stock exchange and merger were announced. The implied net market ratio for the third quarter of 2025 was 1.8 times that of CICC A shares, 1.8 times that of Dongxing Securities (including a 26% premium), and Cinda Securities reached 3.1 times. In principle, this merger will have a synergetic effect, and all parties will take what they need, but the performance of CICC (03908) was unsatisfactory, and it only increased by 2.53%. The reason is that the general environment is sluggish, and the emotional premium is not high. Furthermore, after the merger, we need to further see how effective the integration is. Big Finance is not as excited today as it was yesterday, but overall it is stable, and the types that have been adjusted continue to rise. For example, China People's Insurance (01339) and China Merchants Bank (03968) all rose more than 2%.

The aviation industry is the hottest hyped up in the market today. This section has been mentioned over and over again. The main logic is that the RMB was strong, which was mentioned yesterday, and that the airline industry's ticket prices have become relatively friendly as a result of anti-domestic scrambling. Recent changes include a significant increase in passenger occupancy rates. For example, China Eastern Airlines' passenger occupancy rate reached 87.37% in November, which was the best performance among the three major airlines, with a year-on-year increase of 3.04 percentage points. Therefore, the biggest increase was China Eastern Airlines (00670), which surged more than 8%, while the other China Southern Airlines (01055) and Air China (00753) all increased 5%.

Storage giant Kingston's data center SSD business manager recently said that the shortage of NAND flash memory will increase markedly in the next 30 days, and SSD prices are expected to rise further. Meanwhile, the non-volatile memory business in Fudan, Shanghai (01385) can directly benefit from this wave of storage price increases. The agency predicts that the company's next-generation 1xnm FinFET FPGA products will begin contributing revenue in 2026, and anticipates that the business's revenue is expected to achieve a high double-digit year-on-year increase in fiscal year 2025. Today's increase is over 7%.

Other stronger varieties were stimulated by news, such as Yuexiu Transportation Infrastructure (01052), which previously announced the acquisition of 85% of Shandong's Qinbin Expressway Construction shares, with a total transaction price of RMB 1.153.5 billion. The Qinbin Expressway is the fastest coastal expressway in the Bohai Rim region. The target highway is part of Shandong Province and is an important part of the Beijing-Harbin Expressway (G1) link of the national highway network. The agency expects the deal to be completed by the end of 2025 or the beginning of 2026. At that time, all revenue from the Shandong Qinbin Expressway will be incorporated into Yuexiu Transportation. Facilitating its EBITDA growth, it is up nearly 5% today.

Minimally Invasive Healthcare (00853) announced that the independent shareholders of Minimalist Xintong approved the merger agreement and proposed transactions under it at the special shareholders' meeting held on December 15, 2025. It is expected that the merger will be completed on or around December 19, 2025. According to this, all existing issued shares of CRM Cayman (including common shares and preferred shares) will be cancelled in exchange for Minimally Invasive Xintong's common shares, and CRM Cayman will become a wholly-owned subsidiary of Minimalist Xintong. The strategic merger aims to comprehensively strengthen the synergy between the two parties in the field of structural heart disease and heart rhythm management. By integrating complementary product lines and global channel resources, the company will accelerate market penetration and improve operational efficiency. Relying on mature overseas teams and infrastructure, we further optimize localized service capabilities and supply chain resilience. Today's increase is over 7%.

Yesterday, stronger lithium batteries were at a disadvantage. Ford Motor cancelled the 6.5 billion US dollar (equivalent to about 46 billion yuan) electric vehicle battery contract with LG New Energy. The amount is equivalent to 37.5% of LG New Energy's total revenue last year. It is rare in the industry for a long-term supply contract of this magnitude to be terminated. The main reason is that demand was weak after the US lifted subsidies, and the company switched to hybrid and extended-range electric vehicles. Naturally, the pure electric battery business will shrink, and the competitiveness itself is not strong. Anyway, canceling orders will have a negative impact on the entire battery industry.

[Section Focus]

The National Development and Reform Commission and other departments issued the “Benchmarking Levels and Benchmark Levels for Key Areas of Clean and Efficient Use of Coal (2025 Edition)”. Among them, it is mentioned that industry enterprises are encouraged and guided to carry out transformation and upgrading of projects in line with actual and long-term development. For new coal development and utilization projects and conditional stock projects, the level of clean and efficient utilization should be promoted, and efforts should be made to reach the benchmark level. For stock projects where the level of clean and efficient utilization is lower than the current benchmark level, guide enterprises to carry out clean and efficient coal utilization transformation in an orderly manner, accelerate the promotion of enterprise pollution reduction and carbon reduction, and resolutely eliminate backward production capacity and poor processes in accordance with the law and regulations.

The transformation of old processes reduces emissions on the one hand, and also improves efficiency. Every transformation actually reduces backward production capacity to benefit leading coal companies.

Main varieties: China Shenhua (01088), China Coal Energy (01898), Yankuang Energy (01171).

[Individual Stock Mining]

Sany International (00631): Domestic and foreign sales of excavators maintain an upward trend, and overseas business continues to grow

In November, 20027 excavators of various types were sold, an increase of 13.9% over the previous year. It sold 9842 units in China, up 9.11% year on year; export volume was 10,185 units, up 18.8% year on year. The company's revenue for the third quarter of 2025 was 5.910 billion yuan, up 14.7% year over year. Net profit for the same period was approximately 406 million yuan, up 14.1% year on year.

Comment: Domestic and foreign sales of excavators maintained an upward trend. The company's profit growth in the third quarter was mainly due to large-scale port machinery, oil and gas equipment, overseas mining vehicles and other emerging businesses, reflecting the company's significant progress in diversified business layout and internationalization strategies. The export volume remained high. Leading construction machinery companies continue to grow steadily in overseas markets, with overseas sales accounting for nearly 50% or more.

On July 22, 2024, the company completed the acquisition of the lithium energy business to bring new revenue streams; fully implemented digital intelligence operations, and implemented measures to improve quality and efficiency, reduce costs and control fees, increasing the gross margin of TBM, Xiaogang Machinery, oil and gas equipment and silicon energy products. The company was driven by stable demand for tunneling machines, strong growth in large-scale port equipment, and the performance of domestic mining trucks exceeding expectations. The company sells products such as Dagang, Xiaogang, mining vehicles, shearers, and tunneling machines to countries and regions in Asia, Europe, Africa, America, etc.

Looking ahead, the company's overseas strategic plan is clear in 2025, and it is highly competitive for overseas products. Highlight products such as steel mining trucks and telescopic forklifts are expected to continue to open up market space and achieve rapid growth in overseas business. The company's overseas business growth is sustainable, and domestic demand for coal mining equipment will gradually stabilize. The traditional peak sales season has arrived, and overall domestic sales of Q4 excavators will remain steady.