On December 30th, the National Development and Reform Commission and the Ministry of Finance issued a notice regarding the implementation of a large-scale equipment renewal and consumer goods trade-in policy starting in 2026. The notice states support for the trade-in of home appliances. Individual consumers purchasing products that meet the Grade 1 energy efficiency or water efficiency standards among six categories of appliances—refrigerators, washing machines, televisions, air conditioners, computers, and water heaters—will receive a subsidy equivalent to 15% of the product's sales price. Each consumer can claim one subsidy per product category, with a maximum subsidy of 1,500 yuan per item. Support is also provided for purchasing new digital and smart products. Individual consumers purchasing four categories of products—mobile phones, tablets, smartwatches/bands, and smart glasses (with a single-item sales price not exceeding 6,000 yuan)—will receive a 15% subsidy on the sales price. Each consumer can claim one subsidy per category, capped at 500 yuan per item. Furthermore, subsidies are supported for purchasing new smart home products (including age-friendly home products), with specific subsidized categories and standards to be reasonably determined by local governments based on actual conditions. Industry insiders analyze that, from an economic perspective, this undoubtedly acts as a dual engine for stimulating consumption and driving industrial upgrading. Specifically, the subsidy policy favors Grade 1 energy efficiency products and smart terminals, compelling enterprises to increase their R&D investments. For instance, home appliance manufacturers need to enhance the efficiency of core components like compressors and chips to meet energy standards, while digital device makers must achieve breakthroughs in areas such as AI algorithms and sensor integration to bolster product competitiveness. This virtuous cycle of "subsidy-innovation-market expansion" will propel Chinese manufacturing towards high-end and intelligent transformation. The Electronics Team at Changjiang Securities believes that the consumer electronics sector has recently been affected by rising memory prices, leading to overly pessimistic expectations for 2026 sales and profitability. The extension of the subsidy policy, on one hand, boosts end-demand and, on the other, provides brand clients with room for price adjustments, which is beneficial for safeguarding profits in the component supply chain. Key recommendations include: Terminal Brands: Xiaomi Corporation (01810), Lenovo Group (00992), Transsion Holdings (688036.SH); AI Glasses: Goertek (002241.SZ), Longqi Technology (603341.SH), Beken Corporation (688608.SH), BIWIN Storage (688525.SH), HaoPeng Technology (001283.SZ); Apple Chain Innovation: Luxshare Precision (002475.SZ), Lens Technology (06613), Lingyi Intelligent Manufacturing (002600.SZ), BYD Electronic (00285), Sunway Communication (300136.SZ).