CITIC reported that looking forward to 2023, overseas post-epidemic stimulus policy decline and the global interest rate hike caused by the Federal Reserve may lead to a substantial recession in major economies in Europe and the United States, thus suppressing overseas demand; the current downward pressure on domestic economic growth is increasing, however, epidemic prevention and control is gradually being optimized and adjusted, and market interest rate cuts are expected to rise gradually. The bank expects consumption recovery and inventory cycle reversal to gradually benefit the upper and middle industries. Rising and falling within the economy may be the main trend of the manufacturing industry next year. Energy issues and regional conflicts push security issues to the first place. The policy report also emphasizes the stability and controllability of energy security, national defense security, industrial chain security and other important areas, which will benefit the relevant sectors of equipment manufacturing.

In terms of industrial trends, the cycle of electrical consumption, general machinery and construction machinery has bottomed out, and the recovery is more deterministic; under the energy problem, the hot demand of the photovoltaic industry chain, the steady installation of wind power and the sustained high investment growth rate of the power system promote the prosperity of the power and energy sectors. Strengthening national defense security will continue to catalyze the fundamentals of the military industrial chain, and the achievement and mixed reform of state-owned enterprises will promote the high growth of the plate, which is good for the industrial chain of integrated circuits, engines, missiles and military aircraft. The safety demand of the industrial chain promotes the independent and controllable development of high-end equipment, and industrial robots, high-end machine tools and electronic measuring instruments are expected to further accelerate technological upgrading and achieve domestic substitution.

At the industry level, it is expected that a number of subdivided industries and individual stocks will benefit from the evolution of manufacturing trends: it is suggested that home appliances should pay attention to the bottoming and improvement of fundamentals, and machinery should pay attention to the warming of demand, internationalization and technological upgrading to push the industry into an upward cycle. the military industry pays attention to the differentiated growth and high prosperity sectors, power equipment and new energy grasp the economy and technology dividends and the development of new infrastructure led by consumption. At the industrial level, it is suggested that the layout should conform to the manufacturing cycle, pay close attention to the safety main line and the sectors with high prosperity, including the beneficiaries driven by the internal rise and fall of the boom and the high growth rate of equipment investment. the beneficiary targets of national defense security and energy security, as well as the sectors with high performance in the manufacturing industry. Individual stocks pay attention to JinkoSolar Holding Co Ltd, Mingyang Intelligence, Guangqi Technology, Zhong Jane Science and Technology, Pai Neng Technology, Hezhong Technology, Shuangliang Energy Saving, Dongfang Electric (01072) and so on.