【Meng Lei from UBS Group Securities: Expected 6% earnings growth for A-shares in 2025.】UBS Group China stocks analyst Meng Lei released the 2025 A-share strategy outlook, citing domestic policy bullishness and net inflow of funds from individual investors as the main support factors for A-shares. In their base scenario forecast, A-shares in 2025 are expected to achieve a 6% profit growth and a slight valuation increase. It is expected that due to the recovery of downstream sector profit margins and the low profit base, the earnings per share growth of the CSI 300 index will increase from 1% in 2024 to 6% in 2025. Despite the A-share market's price-to-earnings ratio approaching its 5-year average level after the rebound since September 24, we believe that the historical average is not a valuation limit. A decline in risk-free interest rates, clearer fiscal policy support, strong net inflow of funds from individual investors, and the entry of 'patient capital' into the market may help reduce equity risk premiums. In fact, the equity risk premium in the current A-share market is still higher than the long-term average by 1.1 standard deviations. A more positive fiscal policy and an earlier stabilization of the domestic real estate market will be the most important catalysts. If the aforementioned factors exceed market expectations, the continued recovery of private sector economic confidence and the entry of more 'patient capital' into the market are expected to lift the market's valuation center.