Core Insights - Hisense Home Appliances reported strong growth in its core business, Hisense Central Air Conditioning, achieving over 20% market share in the multi-split central air conditioning segment [1][3] - The sales of the 5G series products increased by more than double digits year-on-year, reflecting the successful implementation of 5G technology in their offerings [1][3] Group 1 - Since 2015, the company has focused on the research and development of 5G central air conditioning, launching its first 5G IoT central air conditioning unit in 2019 and upgrading to the 5G+ Glory Home series in 2025 [3] - Hisense leads the fresh air air conditioning segment with a sales revenue market share of 43.9%, an increase of 12.3 percentage points year-on-year, establishing itself as a benchmark for healthy air solutions [3] Group 2 - In response to national carbon neutrality goals, Hisense Central Air Conditioning promotes green development with its "Photosynthesis & Direct Drive" series, leading the industry's green transformation [3] - The company has provided services to several projects, including the Jinan Changling Mountain Biomedical Industry Park and the Qingdao Baofeng Times Center, with ultra-level energy efficiency to create comfortable office environments [3] Group 3 - Hisense Central Air Conditioning's technological leadership in 5G, AI, and green innovation, along with its market dominance in multi-split and fresh air systems, positions it as a pillar of Hisense Home Appliances' performance [3] - The integration of whole-house air solutions further strengthens the company's core competitiveness based on technology, providing long-term growth momentum for the home appliance sector [3]

Group 1 - As of August 6, pension funds have appeared among the top ten circulating shareholders of Dongmu Co., holding a total of 6.2664 million shares valued at 127 million yuan [1] - In the second quarter, pension funds were present in the top ten circulating shareholders of three stocks, with a total holding of 39.0852 million shares valued at 875 million yuan [1] - The stocks with the highest holdings by pension funds include Hongfa Co. (28 million shares), Dongmu Co. (6 million shares), and Hisense Home Appliances (5 million shares) [1] Group 2 - The industry distribution of pension fund holdings is primarily concentrated in household durable goods, machinery, and electrical equipment, with one stock in each category [1] - The market value of the three stocks held by pension funds exceeds 100 million yuan, with Hongfa Co. leading at 630 million yuan, followed by Dongmu Co. at 127 million yuan and Hisense Home Appliances at 118 million yuan [1]

Group 1 - The latest stock price of Hisense Home Appliances is 25.44 yuan, with a slight increase of 0.08% from the previous trading day [1] - The company operates in the home appliance industry, focusing on the research, production, and sales of products such as air conditioners and refrigerators [1] - Recent high temperatures in Europe have led to increased demand for cooling appliances, with Hisense's portable air conditioners gaining popularity among Italian consumers [1] Group 2 - Hisense's 2024 ESG report indicates that over 90% of its first and second-level energy consumption products are energy-efficient, with a commitment to peak carbon emissions by 2026 [1] - As of the end of Q2, the Basic Pension Insurance Fund's 1204 combination has become the company's tenth largest circulating shareholder, holding 4.5961 million shares [1] - On August 5, the net outflow of main funds for Hisense Home Appliances was 4.0337 million yuan, while the cumulative net inflow over the past five days was 85.2901 million yuan [2]

Group 1 - The demand for cooling appliances in Europe is increasing due to rising summer temperatures, with Chinese brands gaining popularity for their energy efficiency, aesthetic design, and reliable after-sales service [1][3][4] - Midea's PortaSplit mobile air conditioner has seen significant sales growth, with a 35% year-on-year increase in overall sales in Europe and 60,000 units sold in Germany alone by mid-2025 [1] - Hisense's mobile air conditioners are being adopted as effective solutions for consumers who cannot wait for traditional air conditioning installation, reflecting a shift in consumer preferences [2][3] Group 2 - The rising energy prices in Europe have made energy efficiency a critical factor for consumers when purchasing cooling appliances, leading to increased sales of high-efficiency models [3][4] - Chinese cooling products are not only energy-efficient but also increasingly align with European aesthetic preferences, bolstered by local design centers like Midea's in Milan [4] - The market for handheld fans has also expanded, with sales reaching at least 800,000 units this year, indicating a growing trend towards portable cooling solutions [3]

Group 1 - Hisense Home Appliances announced a significant personnel change with the resignation of President Hu Jianyong due to personal reasons, along with the resignation of Director Zhu Dang [2] - Gao Yuling, the current 44-year-old chairman, will also take on the role of president without receiving additional compensation for the position, marking the beginning of the "Gao Yuling era" [3] - Gao Yuling has a strong financial background and has previously led the financial work for the acquisition of the European home appliance brand Gorenje, earning her the title of "merger female general" [3] Group 2 - The personnel changes come amid a noticeable slowdown in Hisense Home Appliances' performance, with revenue growth of only 1.44% and net profit growth of 3.01% in the first half of 2025, marking the lowest growth rates for the same period in nearly six years [4] - Hu Jianyong's departure has sparked market speculation, particularly as his salary decreased from 7.29 million yuan to 4.06 million yuan in 2024, a reduction of 3.23 million yuan, the largest among executives [5] - Gao Yuling faces significant challenges, including intensified competition in the air conditioning market from major players like Midea and Gree, as well as new entrants like TCL and Philips, alongside a substantial decline in stock price since the 2024 peak [5]

Core Viewpoint - Hisense Home Appliances (000921.SZ) announced that Hisense Communication has completed a share buyback plan, acquiring a total of 13,856,065 shares, which represents 1.00% of the company's total share capital [1] Summary by Relevant Sections - **Share Buyback Details** - Hisense Communication has cumulatively increased its holdings in Hisense Home Appliances by 13,856,065 shares, amounting to a total investment of 356,690,000 yuan [1] - Following this buyback, Hisense Communication now holds a total of 27,716,093 shares, which is 2.00% of the company's total share capital [1]

Summary of Hisense Home Appliances Group (000921.SZ) 2Q25 Earnings Call Company Overview - **Company**: Hisense Home Appliances Group - **Ticker**: 000921.SZ - **Period**: 2Q25 Key Financial Metrics - **Total Revenue**: Rmb49,340 million in 1H25, +1% YoY - **Net Profit**: Rmb2,077 million in 1H25, +3% YoY - **2Q Performance**: Revenue and net profit declined by -3% and -8% YoY respectively, which was below expectations [1][8] Core Business Insights - **Central AC Impact**: Central air conditioning (AC) sales experienced a significant decline of 10%+ in 2Q25, attributed to a weak property market and reduced support from trade-in programs [3][4] - **Legacy White Goods**: Sales of washing machines and refrigerators grew by +5% and +14% YoY respectively in 1H25, aligning with expectations [3] - **Regional Performance**: Overseas sales maintained resilience with +12% YoY growth in 1H25, while domestic sales were flat YoY, indicating a sequential decline in 2Q due to central AC pressures [3] Margin Analysis - **Gross Profit Margin (GPM)**: Increased by 0.6 percentage points to 21.5% in 2Q25 - **Operating Profit Margin (OPM)**: Remained stable at 4.8% in 2Q25 - **Core EBIT Growth**: Excluding non-recurring items, core EBIT grew by 7% in 2Q25 [3] Management Focus Areas - Upcoming earnings call expected to address: 1. Channel breakdown of 2Q decline and outlook for central AC business 2. Trade-in stimulus impacts on domestic legacy white goods 3. Competition intensity in split AC market 4. Updates on export orders and tariff impacts 5. Potential for margin expansion [4] Investment Thesis - **Rating**: Buy - **Rationale**: 1. High earnings growth visibility supported by 2024 ESOP target 2. Attractive dividend yield 3. Undemanding forward P/E valuation against high single-digit profit growth expectations - **Future Drivers**: 1. Growth in the VRF business through Hisense-Hitachi JV 2. Margin improvement in legacy white goods 3. Operational improvements at Sanden with rising EV contributions [5] Valuation and Price Target - **12-month Target Price**: Rmb34 for A-shares and HK$29 for H-shares, based on 14x/11x 2027E P/Es for Hisense-Hitachi JV and legacy white goods respectively [6] Key Risks 1. Weaker-than-expected demand for white goods due to global macroeconomic conditions 2. Further property market slowdown affecting VRF demand 3. Increased competition from domestic players threatening Hisense-Hitachi JV's position 4. Margin dilution from higher developer channel penetration 5. Below-expected integration of Hisense-Hitachi JV 6. Underperformance of legacy white goods business [7]

Summary of Hisense Home Appliances Conference Call Company Overview - **Company**: Hisense Home Appliances - **Period**: First half of 2025 Key Financial Metrics - **Revenue**: 49.34 billion CNY, slight growth year-on-year - **Main Business Revenue**: 45.7 billion CNY, up 4.98% year-on-year - **Net Profit**: 2.077 billion CNY, up 3% year-on-year - **Operating Cash Flow**: 5.322 billion CNY, up 153% year-on-year - **Earnings per Share**: 1.52 CNY, slight growth year-on-year [4][5][6] Industry and Market Dynamics - **Domestic Market**: Intense competition, particularly from new entrants like Xiaomi and established players like Midea [7] - **Central Air Conditioning Market**: Overall slight decline, but Hisense Hitachi's performance outperformed the market [4][15] - **Overseas Market**: Continued growth expected, although second-quarter growth slowed [9][11] Strategic Initiatives - **Cost Control and Efficiency**: Implemented organizational changes, R&D collaboration, supply chain integration, and manufacturing optimization to enhance efficiency and reduce costs [2][7] - **Global Strategy**: Transitioned to a "7+1" global operational center layout to strengthen overseas team building and market responsiveness [2][10] - **Product Development**: Focus on high-margin new products and optimizing product structure to improve profitability [16][17] Product Performance - **Ice and Washing Products**: Profit margins improved due to scale effects and product enhancements; Hisense refrigerators ranked first in sales in 12 countries [12] - **Three Electric Business**: Affected by exchange losses and personnel optimization costs, but expected to save 100-120 million CNY annually through personnel optimization [13] - **Central Air Conditioning**: New products to be launched in the home decoration sector, with a focus on heat pump products [15] Future Outlook - **Revenue and Profit Goals**: Despite second-quarter performance concerns, the company remains optimistic about achieving annual targets [14][30] - **Market Growth Expectations**: Anticipated growth in the third quarter, with better performance expected in the fourth quarter [26] - **Impact of Subsidy Policies**: The effectiveness of subsidy policies for home appliances is expected to continue, supporting market growth [32] Challenges and Risks - **Competitive Pressure**: Increased competition in the domestic market and potential impacts from geopolitical factors on production capacity [27][28] - **Inventory Management**: Central air conditioning inventory expected to clear in the third quarter, with a focus on improving efficiency [31] Management Changes - **Leadership Adjustments**: Recent changes in the board reflect a strategic upgrade for air conditioning and overseas business segments, aiming to enhance international marketing and operational synergy [17][18] Conclusion Hisense Home Appliances is navigating a competitive landscape with strategic initiatives aimed at improving efficiency, expanding market presence, and enhancing product offerings. The company remains optimistic about future growth despite current challenges and is focused on maintaining profitability through cost control and product innovation.

Summary of Hisense Home Appliances Group (000921.SZ) Earnings Call Company Overview - **Company**: Hisense Home Appliances Group - **Ticker**: 000921.SZ - **Industry**: Home Appliances Key Financial Results - **2Q25 Performance**: - Total revenue: Rmb 49,340 million, Net profit: Rmb 2,077 million - Year-over-year growth: +1% in revenue, +3% in net profit - 2Q25 implied decline: -3% in revenue, -8% in net profit - **Market Reaction**: - Share price declined by 5.6% in A-shares and 6.4% in H-shares, compared to CSI300 (-3.2%) and HSI (-1.6%) [1][2] Management Insights - **Earnings Call Date**: July 31 - **Key Topics Discussed**: - 2025 guidance, Hisense-Hitachi partnership, overseas updates, domestic competition, margin outlook - **Management's View**: - Results may be better than they appear due to short-term adjustments in the central AC business, which is expected to improve [2][4] - Developer channel revenue declined, but retail and commercial channels remained stable [2][4] Margin and Revenue Insights - **Margins**: - Domestic margins remained stable while export margins improved due to product upgrades and operational efficiency [2][8] - **Channel Performance**: - Core central AC business saw a decline, but positive growth was noted in the 2C channel [5][8] - **Overseas Sales**: - Negative growth in overseas sales attributed to proactive risk management; expected improvement in 4Q25 [8] Earnings Forecast and Valuation - **Revised Earnings Estimates**: - EPS estimates for 2025E-2027E revised down by 0-2% [6][10] - **Price Target**: - 12-month target price set at Rmb 34 for A-shares and HK$ 29 for H-shares, based on 14x/11x 2027E P/Es [12][14] - **Valuation Metrics**: - Current trading at 10x/8x 25E P/E with a dividend yield of 5%/6% [2][10] Investment Thesis - **Reasons for Buy Rating**: - High earnings growth visibility supported by 2024 ESOP target - Attractive dividend yield - Undemanding forward P/E against high single-digit profit growth [10][11] Risks Identified - **Key Risks**: - Weaker global demand for white goods - Property market slowdown affecting VRF demand - Increased domestic competition impacting Hisense-Hitachi JV - Margin dilution from developer channel penetration - Integration challenges with Hisense-Hitachi JV [13][10] Conclusion - **Overall Outlook**: - Despite short-term challenges, the long-term growth potential remains strong due to product expansion and operational improvements. The company is positioned to benefit from synergies between its central and split AC businesses, as well as overseas market opportunities [2][10][11]

Core Viewpoint - Hisense Home Appliances Group Co., Ltd. announced the completion of a shareholding increase plan by its controlling shareholder's concerted action party, Qingdao Hisense Communication Co., Ltd., which has acquired a total of 13,856,065 shares, representing 1.00% of the company's total share capital [2][11]. Group 1: Shareholding Increase Plan - The shareholding increase plan was disclosed on July 9, 2025, with a timeframe from July 4, 2025, to January 3, 2026, aiming to acquire between 6,928,084 and 13,856,168 shares [2][7]. - As of the announcement date, Qingdao Hisense Communication has completed the acquisition of 13,856,065 shares, amounting to 356,690,000 yuan [2][11]. - Following this increase, Qingdao Hisense Communication holds a total of 27,716,093 shares, which is 2.00% of the total share capital [2][11]. Group 2: Changes in Shareholding Structure - The total share capital of the company decreased from 1,385,616,805 shares to 1,384,861,171 shares due to the repurchase and cancellation of 755,634 restricted shares [3][10]. - The indirect controlling shareholder, Hisense Group Holdings Co., Ltd., increased its total shareholding from 47.28% to 48.30% after the completion of the shareholding increase [3][11]. - The shareholding structure includes 516,758,670 shares held by Qingdao Hisense Air Conditioning Co., Ltd. (37.31%), 124,452,000 shares held by Hisense (Hong Kong) Co., Ltd. (8.99%), and 27,716,093 shares held by Qingdao Hisense Communication (2.00%) [3][11]. Group 3: Compliance and Legal Aspects - The shareholding increase does not violate any relevant regulations and will not lead to a change in the company's control [13]. - The implementation of the shareholding increase plan complies with the provisions of the Company Law and the relevant regulations of the Shenzhen Stock Exchange [13]. - A legal opinion was issued confirming that the increase does not require a mandatory tender offer [13].