China on the ground – June 2026

研报英文原文证据摘录

China on the ground – June 2026

emand, +86-21-3866 8831

cost pressure and fierce competition. However, companies are still identifying growth

Cathy Fang, PhD

drivers, including: 1) new model launches, which we see as largely zero-sum for the

Analyst

industry; 2) overseas sales (potentially decent profits but carry geopolitical risk); and 3) S1460518100001

physical AI applications, where we see potential, albeit with greater uncertainty. cathy.fang@ubs.com

+86-21-3866 8891

SMID: Our field trip visiting Neway, Nanomicro Technology, Jinhong Gas, Develop, Sharon Ding

Chervon, and Tiangong Int'l in Jiangsu has raised our confidence in China's high-end Analyst

manufacturing capabilities. Examples include: 1)Tiangong Int'l, which is likely to benefit sharon.ding@ubs.com

from the AI supercycle, after starting construction on a production line with 300 tons of +852-2971 6284

ultrafine-grain carbide rod capacity pa, potentially dedicated to PCB drilling and milling Ingrid Zhang

tools, and 2) Chervon, whose EGO brand is the top lithium-battery OPE platform in the Analyst

US based on revenue market share of 16% in H125. S1460517080003

ingrid.zhang@ubs.com

+86-21-3866 8853

Utilities: We visited Sungrow's office in Hefei, and came back with three key

takeaways: 1) Sungrow is optimistic about the progress of its development of solid-state Paul Gong

transformers, with launch likely in the next few months. 2) Sungrow has been selling Analyst

paul.gong@ubs.com

AIDC BESS to developers/integrators since Q126, who then resell them to US cloud

+852-2971 7868

service providers, and sees a promising outlook for US BESS demand. 3) Sungrow

remains cautious on margins for the overall BESS business. Wei Shen

S1460518060001Heat map: Consumer bottoming vs. semi fading

wei.shen@ubs.com