Since the beginning of this year, China's "anti-involution" initiatives have continued to advance, with strategic deployment for establishing a unified national market steadily implemented. Against this backdrop, destocking and stabilizing growth have become the main themes of domestic market operations. This trend is gradually showing results, with many companies leveraging favorable winds from price recoveries. In the benign competitive environment brought by "anti-involution," many firms either achieved performance turnarounds in the first half of this year, escaping difficulties, or sustained growth demonstrating their development capabilities.

**Multiple Positive Factors Resonate** **CSTC Advanced Materials Hits Daily Limit**

On the evening of August 21, CSTC Advanced Materials released its interim report, achieving net profit of 999 million yuan in the first half of the year, up 114.92% year-over-year. According to previously disclosed performance forecasts, the optimization of glass fiber product structure and year-over-year price increases were among the key reasons for the company's performance growth.

The company previously disclosed on investor interaction platforms that its independently developed first-generation low dielectric products for high-end PCB applications received a "PCB Diversification Project Technology Breakthrough Award" from a renowned domestic client and have entered mass production and supply.

Evidently, benefiting from price increases of its flagship products and improved prosperity in upstream and downstream industries, CSTC Advanced Materials achieved its highest net profit growth rate in the same period over the past decade in the first half, and hit the daily limit on August 22, the day after releasing its interim report.

**"Anti-Involution" Alleviates Disorderly Competition**

In fact, the continuous implementation of domestic "anti-involution" initiatives, combined with improved industry prosperity, has led to price increases across many domestic products, including the copper clad laminate (CCL) industry in the upstream PCB supply chain and titanium dioxide companies. Industry insiders believe that CCL price increases are primarily driven by both rising raw material costs and surging downstream demand, marking the entry of the PCB industry into a new prosperity cycle.

According to Business Society data, bulk commodities including toluene diisocyanate (TDI), chloroform, lithium phosphate, and neodymium oxide all recorded price increases exceeding 15% from early to late July. Additionally, according to Baiinfo data, as of August 21, the main rare earth variety praseodymium oxide was quoted at 657,500 yuan per ton, up 110,000 yuan per ton from early August, representing an increase of over 20% and a year-to-date gain exceeding 58%.

Shenwan Hongyuan Securities stated that "anti-involution" policies are driving enterprises to shift from pure price competition to technology and quality competition, accelerating industrial upgrading. Companies are increasing R&D investment, improving product quality and service levels, adding product value, and thus gaining the ability to raise product prices. In some high-end manufacturing sectors, companies in the "anti-involution" environment are focusing on technological innovation, with improved product differentiation levels, enabling them to escape low-price competition predicaments and achieve dual improvements in product prices and profits.

**"Anti-Involution" + Price Increase Beneficiary Stocks Emerge**

According to incomplete statistics, as of August 22, among over 1,600 stocks that disclosed 2025 interim report forecasts, 64 stocks showed improved performance in the first half (including net profit growth and turnarounds from losses) due to benefiting from "anti-involution" initiatives or price increases (hereinafter referred to as "anti-involution" + price increase beneficiary stocks).

From an industry distribution perspective, these 64 stocks are distributed across 13 industries, concentrated in basic chemicals, non-ferrous metals, and construction materials, with 21, 19, and 5 stocks respectively in these three industries.

In terms of performance (calculated using median values of performance forecasts), among these 13 industries, 9 industries recorded year-over-year net profit growth in the first half of 2025, including basic chemicals, agriculture, forestry, animal husbandry and fisheries, and environmental protection. Among them, the agriculture, forestry, animal husbandry and fisheries industry saw overall net profit growth exceeding 820% in the first half of this year, compared to less than 100% in the same period last year.

Looking at individual stocks, 54 stocks achieved performance growth in the first half of 2025, while the remaining 10 turned around from losses.

Fujian Cement achieved a turnaround from losses in the first half. During the reporting period, the company actively implemented staggered production, responded to and promoted industry "anti-involution" coordination, strengthened precision marketing, achieving year-over-year increases in average cement selling prices and slight increases in commodity sales volume.

Huaxin Cement actively responded to "anti-involution" and "stable growth" initiatives, practicing the philosophy that "profit is the goal, price (revenue) is the foundation." Cement product average selling prices increased year-over-year, with net profit growth median exceeding 50% in the first half of 2025, reversing the continuous decline in net profit over the same period in the past three years.

Additionally, Huahong Technology, Xianda Agrochem, Sotec Environmental, and Suoli Pharmaceutical all recorded net profit growth (including median growth) exceeding 10 times in the first half of this year. Among them, Huahong Technology's net profit growth median approached 34 times in the first half, ranking first among the 64 stocks, mainly due to the relatively low net profit base in the same period last year. The company stated that performance growth mainly benefited from the stabilization and recovery of domestic major rare earth raw material product prices driven by national industrial policy support, improved market supply-demand patterns, and changes in the international trade environment. Leveraging its technological accumulation and operational advantages in rare earth resource comprehensive utilization, the company effectively seized market opportunities and promoted good development momentum in the rare earth resource comprehensive utilization segment.

**Over 40% of Stocks Record Annual Price Gains Exceeding 50%**

From market performance perspective, as of August 22, the above 64 stocks recorded an average annual gain approaching 52%, with 27 stocks gaining over 50%, accounting for over 40% of the total, including 7 stocks that doubled in price.

Zhongyi Da recorded annual gains exceeding 220%. The company turned around from losses in the first half. During the reporting period, affected by market conditions, the gradual recovery in prices of the company's core product pentaerythritol series drove gross margin increases, leading to year-over-year net profit growth.

Limin Chemical recorded annual stock price gains of nearly 170%, with first-half net profit growth exceeding 740%. The main reasons for performance improvement compared to the same period last year were year-over-year increases in sales volume and prices of the company's main products, improved gross margins, and increased investment income from performance improvements at equity-method investees.

Additionally, first-half turnaround stocks Shenghe Resources and Guangsheng Nonferrous both recorded annual stock price gains exceeding 130%, with turnaround reasons including year-over-year price increases in major rare earth products and expanded production scale.

**Only 5 Lagging Stocks See Significant Margin Financing Increases**

Among the above 64 stocks, 52 are margin trading targets, with nearly 70% (36 stocks) showing increases in latest margin financing balances (as of August 21) compared to year-end, including newly added margin trading targets.

Over 30 stocks received margin financing increases exceeding 10%, with Sotec Environmental, Fujian Cement, and Zhongyi Da receiving increases exceeding 100%. Among them, Sotec Environmental's latest margin financing balance was 765 million yuan, up over 275% from year-end; Fujian Cement received increases exceeding 195%.

Combining industry analysis, among "anti-involution" + price increase beneficiary stocks, as of August 22, only 5 stocks underperformed their respective SW industries year-to-date while receiving margin financing increases exceeding 20% compared to year-end. Ranked by financing increase magnitude, they are: Sinochem International, Zijin Mining, China State Shipbuilding, China Shipbuilding Power, and Shandong Gold International, with Sinochem International receiving margin financing increases exceeding 120%.

China State Shipbuilding and China Shipbuilding Power both recorded net profit growth medians exceeding 100% in the first half, while Zijin Mining achieved first-half net profit growth exceeding 50%.

From market performance perspective, Sinochem International gained only 0.17% year-to-date, while its basic chemicals industry index gained over 22%, with Sinochem International underperforming the industry index by over 22 percentage points. China State Shipbuilding underperformed its defense and military industry index by nearly 22 percentage points, while the other 3 stocks all underperformed their respective industry indices by over 10 percentage points.