Growth-Oriented Financial Report Tracking – October 26, 2012

Reasons for growth: Year-on-year increases in selling prices of electrolytic aluminum and coal products, coupled with a year-on-year decline in the price of alumina—the primary raw material—resulted in dual benefits from higher revenues and lower costs. Personal view: Net attributable profit for the first three quarters rose by +112% year-on-year to RMB 7.4 billion—a truly robust performance given the company’s scale. This is undoubtedly the most solid earnings report released tonight. From a growth-stock perspective, however, Q3’s sequential growth of only +5% signals a clear deceleration, indicating that aluminum prices have plateaued at high levels with limited upside potential. Fundamentally, the stock is a cyclical play driven jointly by aluminum and coal prices—with aluminum price being the dominant variable. Standard review. 6. Northern Rare Earth — Rare Earths Earnings: The company specializes in rare earth smelting, separation, and deep processing, and is a leader in rare earth resources. It expects non-recurring net profit for the first three quarters to range between RMB 3.63 billion and RMB 3.69 billion, representing a year-on-year increase of +166.64% to +171.04%. Estimated Q3 standalone net profit stands at RMB 1.567–1.627 billion—up +37% to +43% sequentially from Q2’s RMB 1.135 billion. Reasons for growth: Key rare earth product prices remained volatile but at elevated levels; the company improved cost efficiency, optimized sales strategies, and continued to realize synergies across its integrated industrial chain. Personal view: Its growth logic rests on two pillars: (1) control over the Bayan Obo resource base, with Phase I of its green smelting project already operational and Phase II under construction; plus joint ventures expanding rare earth metal alloys and cerium-containing NdFeB magnet production; and (2) downstream exposure to new-energy vehicles, wind power, robotics, and low-altitude economy sectors. At its core, however, it remains a cyclical stock—worth tracking, but standard review. 7. JieJie Microelectronics — Power Semiconductors Earnings: The company manufactures power semiconductor devices—including thyristors, protection devices, and MOSFETs. It expects non-recurring net profit for the first three quarters to range between RMB 553 million and RMB 623 million, up +60% to +80% year-on-year. Estimated Q3 standalone net profit stands at RMB 257–327 million—up +30% to +65% sequentially from Q2. Reasons for growth: Strong downstream demand significantly expanded order backlog; concurrently, rising industry prosperity enabled reasonable price adjustments for its products. Revenue surged rapidly under this dual impetus of volume and price growth. Personal view: Q3’s sequential growth of +30% to +65% reflects both heightened industry prosperity and product price hikes—classic volume-and-price expansion. Power semiconductors serve as foundational components for AI server power supplies, data centers, and new-energy vehicles—thus benefiting directly from AI hardware infrastructure expansion. During prior AI rallies, stocks were eagerly branded as 'AI-related'; now that the AI theme has cooled, market participants actively distance themselves from such labels—yesterday’s sweetheart has become today’s unwanted burden. Times change—and so does sentiment. Standard review. II. Summary 1. Tonight’s batch of high-performing stocks reporting Q3 earnings previews falls into three thematic categories: AI computing & optical communications (Lianxun Instruments + ChaoSheng Electronics), pharmaceuticals (Hanyu Pharmaceutical—GLP-1 active pharmaceutical ingredient), and resource/cyclical sectors (rare earths, aluminum & coal, ore & sulfuric acid). 2. The AI hardware supply chain has delivered high-growth earnings for three consecutive reporting periods: Lianxun Instruments posted Q3 net profit growth of +26% to +53% sequentially—its optical communication test equipment benefiting from the AI-computing → optical module capacity-expansion transmission chain; ChaoSheng Electronics reported Q3 net profit growth of +181% to +206% sequentially—driven by volume-and-price expansion in copper-clad laminates (CCL) and printed circuit boards (PCBs). One operates at the equipment end, the other at the materials end—both jointly confirming exceptionally strong demand realization across the AI hardware chain.

October 13, 2026 Post-Mortem Diary

Success rate breakdown: 2-to-3 consecutive涨停 success rate = 36% (5 out of 14); 1-to-2 consecutive涨停 success rate = 18% (5 out of 28); overall consecutive涨停 success rate = 27.78%. Conclusion: The structure of the consecutive涨停 ladder has contracted markedly in height. Xinhua Media—having achieved 10 consecutive涨停—entered suspension for regulatory scrutiny today, causing the pure consecutive涨停 ceiling to plunge abruptly from 10 to just 3. With no clear market-height benchmark remaining, high-profile momentum stocks entered pronounced retreat: Zizhu High-Tech, North China Pharmaceutical, and Neimenggu Xinhua all hit daily trading limits down; Xinhua Wenxuan and Shanghai Xibai fell more than 8%; and the solid-state battery sector broadly retreated. Yet ‘Yang’-themed speculative trading warmed up again: Baiyang Shares’ third consecutive涨停 spurred rallies in Huayang New Materials, Sunshine Dairy, Huayang International, and Aoyang Health—all hitting daily limits up; while Joyoung rebounded sharply from a >7% intraday drop to close up 6.19%. Overall, willingness among capital to接力 high-momentum stocks visibly weakened—characterizing the current consecutive涨停 ecosystem as one of ‘compressed height, mystical succession.’ 【Hot Sectors】 1. PCBs: ① Earnings pre-announcements surge: Transition from ‘capital expenditure expansion’ to ‘profit realization phase’ The concentrated wave of positive earnings pre-announcements served as the immediate catalyst for today’s rally. According to Wind data, as of October 12, six listed companies along the PCB supply chain had issued preliminary Q3 or first-three-quarters 2026 earnings forecasts—all projecting substantial year-on-year growth in net attributable profit. Jingwang Electronics delivered the most striking forecast. It expects Q3 revenue of RMB 6.12–6.98 billion (+53.48% to +75.05% y-o-y) and net attributable profit of RMB 912–1,089 million (+205.46% to +264.74% y-o-y). In its announcement, the company explicitly attributes this to accelerated mass production and delivery of high-performance PCBs for high-speed communications and AI data infrastructure, combined with rational cost-price pass-through and optimized order mix in general-purpose segments. As of end-Q3, order backlogs remain robust for AI servers, data centers, and high-speed optical modules—while capacity utilization and yield rates remain high. ChaoSheng Electronics’ performance was equally impressive. It forecasts first-three-quarters net attributable profit of RMB 340–360 million (+90.78% to +102% y-o-y), with Q3 alone expected at RMB 227–247 million—up +181% to +206% sequentially. The company notes sustained high industry prosperity in CCL, characterized by simultaneous volume-and-price expansion; CCL orders remain abundant, selling prices are rising, and profitability is improving. Guanghe Technology forecasts first-three-quarters net attributable profit of RMB 1.45–1.5 billion (+100.33% to +107.23% y-o-y), focusing squarely on the computing-power theme—targeting markets for general-purpose servers, AI servers, switching equipment, and accelerator cards. Xia Fanjie, Strategy Analyst at China Securities Co., Ltd., offered a representative assessment: ‘Based on disclosed Q3 earnings pre-announcements, AI computing infrastructure development has shifted from the “capital expenditure expansion phase” into the “financial statement profit realization phase.” Revenue, gross margin, and order backlog metrics are all improving simultaneously across PCBs, high-speed materials, and semiconductor manufacturing segments.’ ② CCL price hike wave: Full upstream-to-downstream transmission, with smooth price-pass-through mechanism established in PCB segment Sustained upstream CCL price hikes constitute the critical transmission link driving this round of profitability recovery across the PCB supply chain.

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