Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company's performance forecast for H1 2025 indicates a continued upward adjustment in profit margins, with cost reduction and efficiency improvement effects becoming evident [1] - The company is expected to achieve a net profit of 1.16 billion yuan in H1 2025, with Q2 2025 net profit projected at 690 million yuan, reflecting a quarter-on-quarter increase of 42% and a year-on-year increase of 48% [1] - The company has successfully turned around its non-recurring net profit for the first time in five years, with a projected non-recurring net profit of 120 million yuan for H1 2025 and 220 million yuan for Q2 2025 [1] - The company’s sales volume in Q2 2025 is expected to increase due to export demand, with total sales of 11,500 units in Q2 2025, showing a year-on-year increase of 11.19% [1] - The integration of three subsidiaries and a new management team is anticipated to lead the company into a new development phase, enhancing internal efficiency and accelerating profit release [1] Financial Forecasts - The company’s total revenue is projected to be 24.987 billion yuan in 2025, with a year-on-year growth of 8.80% [1] - The net profit attributable to the parent company is expected to reach 4.442 billion yuan in 2025, representing a year-on-year increase of 181.62% [1] - The earnings per share (EPS) for 2025 is forecasted at 0.62 yuan, with a price-to-earnings (P/E) ratio of 20.60 [1] - The company’s revenue for 2026 and 2027 is projected to be 26.757 billion yuan and 28.497 billion yuan, respectively, with corresponding net profits of 6.443 billion yuan and 8.274 billion yuan [1]

Core Viewpoint - The new energy heavy truck market experienced significant growth in June 2025, with a year-on-year increase of 158%, reaching a record sales volume of 18,000 units, including over 12,000 units of charging heavy trucks, setting a new monthly sales record [1][4]. Market Performance - In June 2025, the domestic new energy heavy truck market sold a total of 18,000 units, with a month-on-month increase of 19% and a year-on-year increase of 158% [4][5]. - Pure electric heavy trucks accounted for 97.87% of total sales, with charging and battery swap heavy trucks contributing significantly [5]. - Battery swap heavy trucks sold 5,573 units in June, marking a month-on-month increase of 16% and a year-on-year increase of 141%, although this growth rate was lower than the overall new energy heavy truck market [5][6]. Market Share and Competition - The market share of battery swap heavy trucks in pure electric heavy truck sales was 31.62% in June, showing a slight decline from the previous month and a decrease compared to the same period last year [7]. - From January to June 2025, the battery swap heavy truck market saw participation from 27 companies, with 24 active participants as of June [20]. - The top-selling companies in June included Foton, Xugong, and Jiefang, with Foton achieving a remarkable year-on-year growth of 825% [16][18]. Segment Analysis - The battery swap heavy truck segment is dominated by tractor and dump trucks, which accounted for 86.38% and 11.72% of sales, respectively [11][27]. - The competition in the battery swap tractor market is intense, with six companies selling over 2,000 units each, and Foton leading with 4,147 units sold [29]. - The battery swap dump truck segment did not keep pace with the overall growth, with a year-on-year increase of only 26% [31]. Conclusion - The battery swap heavy truck sector has shown impressive growth in the first half of 2025, with continuous month-on-month increases, but it still lags behind the overall new energy heavy truck growth rate [36].

Summary of Conference Call Industry Overview - The focus is on the **new energy vehicle (NEV)** sector, particularly in the context of the **bus manufacturing industry** in China, including companies like **Yutong** and **King Long** [1][2][3][4][5][11]. Key Points and Arguments - **Government Support for Domestic Demand**: The government is emphasizing the importance of stimulating domestic demand, which is expected to positively impact consumption, travel, and tourism [1]. - **NEV Market Performance**: The penetration of new energy vehicles remains low, with only about **10%** market share in the bus segment, indicating underperformance compared to previous years [2][3]. - **Sales Data**: - Yutong sold **2,206** large and medium-sized buses in April, down **36.24%** year-on-year and **25.85%** month-on-month [3]. - King Long's sales were **1,513** units, with a year-on-year decline of **19.82%** and a month-on-month decline of **0.98%** [3]. - **Product Strategy Shift**: Yutong is focusing on light buses to meet the demand for customized and smaller group travel, which may lead to a higher sales volume in this segment [4]. - **Export Trends**: - Yutong's exports decreased by **32.32%** year-on-year, while King Long's exports increased significantly, reflecting a divergence in performance [11]. - The export market is becoming competitive, with companies like **BYD** leading in the NEV export segment [12]. - **Market Dynamics**: The competition among companies is influenced by their respective strategies and market conditions, with some companies focusing on maintaining profitability while others pursue aggressive growth [6][8]. Additional Important Insights - **Internal Competition**: The internal dynamics within companies, such as Yutong and King Long, are evolving, with potential for increased collaboration but also challenges due to historical complexities [7][8]. - **Overseas Market Strategy**: Companies are advised to establish a strong local presence in overseas markets to facilitate smoother operations and avoid complications that arose from previous aggressive order-taking strategies [10]. - **Future Outlook**: The overall trend in the NEV sector is expected to continue evolving, with significant changes anticipated as companies adapt to market demands and government policies [13]. This summary encapsulates the critical insights from the conference call, highlighting the current state and future prospects of the NEV industry in China.

Investment Rating - The automotive industry is rated as "Neutral" for the next six months, indicating expected performance in line with the market [53]. Core Insights - In June, retail sales of passenger vehicles increased by 18.1% year-on-year, with new energy vehicles seeing a growth of 30% [4][44]. - The automotive sector experienced a decline of 0.41% from July 7 to July 11, 2025, underperforming the CSI 300 index by 1.23 percentage points [10][44]. - The overall PE-TTM for the automotive industry as of July 11 is 25.83, down by 0.12 from the previous week [11][44]. Summary by Sections Market Overview - The automotive sector's performance from July 7 to July 11 showed a decline across various segments, with the passenger vehicle segment down by 1.43% and commercial vehicles down by 0.99% [10][44]. - The automotive services sector, however, increased by 3.13%, outperforming the CSI 300 index [10][44]. Valuation Levels - As of July 11, the PE-TTM for passenger vehicles is 25.11, for commercial vehicles is 36.01, and for automotive parts is 24.33 [11][44]. - The passenger vehicle segment saw a decrease of 0.37% in valuation, while the automotive parts segment increased slightly by 0.02% [11][44]. New Models and Industry News - 尚界汽车 has released a teaser for its first SUV model, which is expected to launch in the fall of 2025 [3][44]. - A total of 29 new and updated vehicle models were launched during the week of July 7 to July 11 [40][41]. Sales Performance - In June, the total retail sales of passenger vehicles reached 2.084 million units, marking an 18.1% increase year-on-year [7][44]. - Cumulative retail sales for the first half of the year reached 10.901 million units, up 10.8% compared to the same period last year [7][44].

[Current Period Performance Forecast](index=1&type=section&id=I.%20Current%20Period%20Performance%20Forecast) The company anticipates a 74.71% year-on-year increase in net profit attributable to shareholders for H1 2025, reaching approximately **RMB 116 million**, with non-recurring net profit turning profitable H1 2025 Performance Forecast Core Data | Indicator | H1 2025 (Estimated) | H1 2024 (Prior Period) | YoY Change | | :--- | :--- | :--- | :--- | | Net Profit Attributable to Parent | Approx. RMB 116.00 million | RMB 66.40 million | Up 74.71% | | Non-recurring Net Profit | Approx. RMB 12.00 million | RMB -96.79 million | Turned Profitable | - This performance forecast data is a preliminary estimate by the finance department and has not been audited by a certified public accountant[5](index=5&type=chunk) [Prior Period Performance Review](index=1&type=section&id=II.%20Prior%20Period%20Performance%20and%20Financial%20Status) In H1 2024, the company reported **RMB 66.40 million** in net profit attributable to parent, yet a **RMB 96.79 million** loss in non-recurring net profit, with EPS of **RMB 0.09** H1 2024 Performance Review | Indicator | Amount/Value | | :--- | :--- | | Net Profit Attributable to Shareholders | RMB 66.40 million | | Non-recurring Net Profit Attributable to Shareholders | RMB -96.79 million | | Earnings Per Share | RMB 0.09 | [Analysis of Performance Increase](index=2&type=section&id=III.%20Main%20Reasons%20for%20Current%20Period%20Performance%20Increase) Significant performance growth is primarily driven by core business improvements, particularly strong overseas market performance, with reduced impact from non-recurring gains and losses [Impact of Core Business](index=2&type=section&id=(I)%20Impact%20of%20Core%20Business) Core business improvements, driven by steady overseas market growth, increased export revenue and business proportion, significantly contributing to performance - During the reporting period, the company's performance growth benefited from steady growth in overseas markets, leading to increased export business revenue and proportion, and enhanced performance contribution[9](index=9&type=chunk) [Impact of Non-recurring Gains and Losses](index=2&type=section&id=(II)%20Impact%20of%20Non-recurring%20Gains%20and%20Losses) Non-recurring gains and losses decreased year-on-year due to reduced reversal of credit impairment losses, indicating improved profit quality and lower reliance on non-recurring income - During the reporting period, non-recurring gains and losses decreased year-on-year, primarily due to a reduction in the reversal of credit impairment losses[10](index=10&type=chunk) [Risk Warning](index=2&type=section&id=IV.%20Risk%20Warning) The company explicitly states no significant uncertainties exist that would affect the accuracy of this performance forecast - The company confirms no significant uncertainties exist that would affect the accuracy of this performance forecast[11](index=11&type=chunk) [Other Explanations](index=2&type=section&id=V.%20Other%20Explanatory%20Matters) The company emphasizes that this announcement's data is preliminary, with final accurate figures subject to the officially disclosed 2025 semi-annual report, advising investment risk awareness - The forecast data provided is preliminary, and the final accurate financial data will be based on the company's officially disclosed 2025 semi-annual report; investors are advised to be aware of investment risks[12](index=12&type=chunk)

Core Viewpoint - The public transportation group in Mianyang, Sichuan Province, has announced the results of its new energy bus procurement project, highlighting significant contracts awarded to various manufacturers for electric buses [1][2]. Summary by Sections Procurement Details - The project is officially titled "Sichuan Province Mianyang City New Energy Bus Procurement Project" with the project number SCCFCG【2025】002 [2]. - The procurement method used was open bidding, and the evaluation took place on July 7, 2025 [2]. Bid Results - **Package 1**: Awarded to Xiamen Jinlong United Automotive Industry Co., Ltd. with a total bid amount of 63,878,000 yuan for 82 units of 8-meter pure electric buses, each with a battery capacity of at least 200 kWh [1][3]. - **Package 2**: Awarded to CRRC Times Electric Vehicle Co., Ltd. with a total bid amount of 97,555,000 yuan for 109 units of 10-meter pure electric buses, each with a battery capacity of at least 250 kWh [1][3]. - **Package 3**: Awarded to China National Heavy Duty Truck Group Mianyang Special Automobile Co., Ltd. with a total bid amount of 83,424,000 yuan for 88 units of 10-meter pure electric buses, each with a battery capacity of at least 300 kWh [1][3]. Pricing Information - The unit price for Package 1 is 779,000 yuan per bus [3]. - The unit price for Package 2 is 895,000 yuan per bus [3]. - The unit price for Package 3 is 948,000 yuan per bus [3]. Additional Information - The evaluation committee was led by Wang Yonggao, with several other members participating [3]. - The public announcement period for the procurement results is from July 9 to July 11, 2025 [3]. - The contact person for the procurement is Mr. Xiang, with a provided contact number for inquiries [3].

Core Viewpoint - Jinlong Automobile is facing significant challenges despite previous growth, with a recent announcement of share reduction by its second-largest shareholder indicating potential concerns about the company's future performance [1][8]. Financial Performance - Jinlong Automobile's sales in Q1 2025 reached 11,000 units, a year-on-year increase of 11.79%, but subsequent months showed negative growth, with sales of 3,611 and 3,575 units in April and May, respectively, resulting in a slight overall increase of 0.21% for the first five months [6][8]. - The company reported a historical high asset-liability ratio of 85.9% as of the end of Q1 2025, indicating increasing financial pressure [7][8]. - From 2019 onwards, Jinlong Automobile has accumulated a non-recurring net profit loss of 2.156 billion yuan over six years [5]. Management Changes - The company has undergone multiple management changes, with the latest being the appointment of Chen Feng as chairman following the resignation of Xie Siyu in April 2025 [3][8]. - Chen Feng's experience in the automotive industry is seen as crucial for navigating the company's current challenges, including declining sales and ongoing financial difficulties [8]. Historical Context - Jinlong Automobile has experienced fluctuating performance since its establishment in 1988, with significant management turnover and a notable "subsidy fraud" incident impacting its reputation and financial stability [1][2][4]. - The company achieved its best performance in terms of revenue growth from 2022 to 2024, but still faced challenges with non-recurring net profit losses during this period [5].

Investment Rating - The report assigns a "Buy" rating to several companies, including Changan Automobile, Asia-Pacific Holdings, and Haon Electric, while maintaining an "Overweight" rating for the overall automotive industry [1][4]. Core Insights - The automotive sector experienced a slight increase of 0.1% from June 30 to July 4, 2025, underperforming the CSI 300 index by 1.44 percentage points. The passenger vehicle segment rose by 0.43%, while commercial vehicles increased by 1.49% [9][36]. - Heavy-duty truck sales in June 2025 exceeded expectations, with a year-on-year increase of 32% and a month-on-month increase of 6%. Approximately 94,000 units were sold, with major manufacturers like China National Heavy Duty Truck and Dongfeng showing significant growth [2][36]. - The report highlights the launch of the Xiaopeng G7, the first AI car with L3-level computing power, priced between 195,800 and 225,800 yuan, showcasing advanced technology features [5][36]. Summary by Sections Market Review - The automotive sector's performance from June 30 to July 4, 2025, showed a 0.1% increase, with various segments performing differently against the CSI 300 index [9][36]. - The overall PE-TTM for the automotive industry was 25.95, reflecting a slight increase from the previous week [10][36]. Major Company and Industry Events - Heavy-duty truck sales in June reached approximately 94,000 units, with significant contributions from major manufacturers [2][36]. - Xiaopeng G7 was officially launched, marking a significant advancement in AI automotive technology [5][36]. New Vehicle Launches - A total of 33 new models were launched during the week, including the Xiaopeng G7 and various updated versions of existing models [34][36]. Investment Recommendations - The report suggests a cautious approach to investment in the automotive sector, given the mixed performance of different segments and the overall market conditions [36].

Core Insights - The company reported a year-on-year increase in bus production for June 2025, with a total production of 4,378 units, up 10.58% from 3,959 units in June 2024 [2][3] - Despite the production growth, the company faced a decline in bus sales, with June sales at 4,283 units, down 9.83% from 4,750 units in the same month last year [3][4] Production Summary - In June 2025, the production of light buses significantly increased to 2,253 units, representing a substantial growth of 72.25% compared to 1,308 units in June 2024 [2][3] - Conversely, production of large buses decreased by 25.34% to 1,391 units, and medium buses saw a decline of 6.85% to 734 units [2][3] - Cumulatively, from January to June 2025, total bus production reached 24,235 units, a 7.41% increase from 22,564 units in the same period last year [2][3] Sales Summary - The cumulative sales for the first half of 2025 totaled 22,510 units, reflecting a slight decline of 1.88% from 22,941 units in the same period of 2024 [4] - Large bus sales saw a notable decrease of 6.63%, totaling 8,517 units, while medium bus sales dropped by 10.59% to 3,708 units [4] - In contrast, light bus sales increased by 6.34% to 10,285 units, indicating a strong performance in this segment [4]

Core Viewpoint - The commercial vehicle industry has experienced significant personnel changes in June, with major companies like Sinotruk, Foton, JAC, and King Long undergoing leadership adjustments [1][25]. Group 1: Sinotruk - On June 27, Sinotruk (Hong Kong) announced multiple high-level personnel changes and board committee restructuring [2]. - Wang Zhijian resigned as chairman and executive director, while Liu Zhengtai was appointed as the new chairman and executive committee chairman [4]. - The company established an ESG committee, with Liu Wei as chairman and other members appointed [5][6]. Group 2: Sinotruk Jinan Truck - On June 7, Sinotruk Jinan Truck Co., Ltd. announced the appointment of Zhao Hai as the new general manager and Zhang Xin as the board secretary [8]. - The previous CEO Zhao Erxiang resigned but will continue to serve as a director [8]. Group 3: Foton - On June 23, Foton Motor Co., Ltd. announced the departure of Gong Haidong from his position as vice president and employee representative director [13]. - Liu Xuguang and Sun Jing were appointed as new vice presidents, while Li Qinghua was elected as the employee representative director [13]. Group 4: JAC - In late June, JAC Motors announced the resignation of Wang Bing as the chairman of the supervisory board due to retirement [18][19]. Group 5: King Long - On June 6, King Long Automobile Group Co., Ltd. reported the resignation of director Chen Jianye, with no specific reason provided [20][21].