Hua Chuang Securities Chief Economist Zhang Yu: Industrial innovation vehicles are reshaping the A-share earnings structure and valuation anchors.

Zhang Yu, chief economist at Huachuang Securities, stated that the rebuilding of capital market confidence needs, in the long run, to be anchored in corporate profitability and industrial innovation. The empowerment of A-share long-term value by industrial innovation is essentially the effective conversion of "growth potential" into "profitability," so that index gains are supported by profits and grounded in industry. Midstream equipment manufacturing, and even the broader new economy, are precisely the clearest vehicles under this logic. Zhang Yu stated that the carriers of industrial innovation, namely midstream equipment manufacturing and the broader new economy, are reshaping the profit structure and valuation anchors of A-shares. Improvements in industrial competitiveness and added value bring higher profit margins and ROE, which in turn drive a long-term rise in the new economy's market capitalization share and the index's central level. Institutional improvements provide the environment for the market, industrial innovation provides profits for the market, and as the two resonate, the foundation of A-share long-term value will become increasingly solid.