CITIC Securities' June 12th research report indicates that as of the beginning of the year, the Hang Seng Tech Index/Chinese Internet Index has accumulated a 0.2%/6.7% increase (as of June 7th), of which the sector has shown a significant excess since late April. Hang Seng Tech Index/Chinese Internet Index have accumulated a 26.2%/25.0% increase from April 19th to May 20th, primarily due to the continued inflow of southbound capital, global fund allocation needs to rebalance, domestic economic expectations to improve, and the better-than-expected performance of most Internet companies in 1Q24. Looking ahead, economic recovery is expected to continue driving improvements in Internet company revenue, while light asset models and operational efficiency improvements are expected to bring stronger leverage effects and continuous release of Internet company profits. We believe that the current valuation of the Chinese Internet sector is still at a historical low, and industry innovation and demand recovery are expected to bring structural opportunities for performance and valuation repair. We recommend two investment directions: 1) Under a neutral macroeconomic hypothesis, focus on incremental tracks such as advertising, live streaming e-commerce, and going international; 2) Focus on Internet companies with stable stock patterns, continuous improvement in profitability, low valuations, stable cash flow, and high shareholder returns.