Guangfa Securities: The recovery of non-financial performance in A shares still takes time, and some industries have shown structural bright spots.

Guangfa Securities released a research report stating that the revenue growth of A-share non-financial interim reports is still in the negative range, with profit growth slowing down, and the quarter-on-quarter growth rate in the second quarter is at the lowest level since 2010. It is expected that the annual A-share non-financial profit forecast will still be at a low single-digit level, and the recovery of performance is still not smooth. At the same time, the bank believes that there are more and more structural highlights in industry comparisons, including overseas profitability, hedging insufficient domestic demand, supporting industries with high income and high gross profit margin; contract liabilities + advance receipts represent an increase in order growth rate, and industries where stock prices are positively correlated with advance receipts growth rate; there is a strong need to demonstrate the necessity of reversing internal competition, and industries where the supply-demand structure urgently needs to be improved. In terms of reversal strategy, it is bullish on wind power cables/machinery/ offshore wind, overseas automobiles, military industry, AI, and lithium battery equipment.