Summary of Conference Call for Longxin General (隆鑫通用) Industry Overview - In the first half of 2025, sales of motorcycles with engine displacement over 250CC increased by over 40% year-on-year, with exports contributing significantly, reaching 265,000 units, a 70% increase year-on-year [2][4] - Domestic sales approached 237,000 units, reflecting a year-on-year growth of approximately 20%, indicating sustained industry prosperity [2][4] Company Performance and Strategy - Longxin's overseas market focus for the second half of 2025 will be on repair motorcycles and scooters, particularly in the 300-900CC range, while the domestic market will prioritize cruising motorcycles [2][6] - The CU625 model has been launched, and a 500CC four-cylinder sports bike is set to be released soon [2][6] - The DS625 and DS800 models have begun delivery, with DS800's production capacity ramp-up completed, although a seasonal downturn in European shipments may affect short-term delivery volumes [2][6] Market Expansion - Longxin's export market is primarily Europe, with Italy and Spain showing strong market conditions, while Germany, France, and the UK have also made breakthroughs [2][7] - The scooter segment has entered Germany's top 15 sales rankings for the first time, and the company is also establishing a presence in emerging markets in Latin America and Asia [2][7] - Longxin has achieved a 6% market share in Spain and is performing well in Italy, enhancing brand visibility and attracting interest from Asian countries [2][8] Product Development - The company plans to launch the world's first dual-cylinder 400CC scooter next year to compete in the 350CC market [3][9] - In 2025, the focus will be on launching 500-900CC adventure bikes, with over 10,000 units of the 900CC model shipped in the first half of the year [9][10] - The company aims to enhance its product line with a focus on scooters and adventure bikes, with the 800CC model expected to surpass the 900CC model in sales due to its lightweight design and consumer preferences [24][25] Financial Performance - The average selling price (ASP) of Longxin's products is expected to increase by over 10% year-on-year, with the average price last year being 17,000 yuan [5][14] - The export unit price exceeded 20,000 yuan in the first half of the year, although an increase in the shipment of the 125 series may slightly impact this figure [5][13] Competitive Landscape - The company faces significant competition in the European market, particularly from established brands like BMW, but is leveraging its product advantages and brand influence to gain traction [17][20] - The competitive pressure is notable in the Mexican market, where inventory issues have affected overall performance, but other Latin American countries like Colombia continue to show growth [12][13] Future Outlook - Longxin plans to continue expanding its product offerings in 2026, focusing on scooters and other vehicle types, while adapting models to meet local market demands [22] - The company is optimistic about the long-term potential of its self-branded low-end models in emerging markets, which are expected to provide stable growth opportunities [10][19]

Investment Rating - The industry investment rating is maintained at "Outperform the Market" [1] Core Insights - In June, total sales of two-wheeled fuel motorcycles reached 1.495 million units, a year-on-year increase of 8.0%. Exports were 1.115 million units, up 17.6%, while domestic sales were 380,000 units, down 12.8% [3][9] - For motorcycles above 250cc, sales in June were 103,000 units, a year-on-year increase of 14.3%. Exports were 57,000 units, up 59.9%, and domestic sales were 46,000 units, down 15.6% [3][9] - Electric motorcycle sales surged to 31,000 units in June, reflecting a dramatic year-on-year increase of 2192.0% [3][18] - The all-terrain vehicle (ATV) segment saw domestic factory shipments of 18,000 units in June, marking a 5.8% increase year-on-year [3][18] Summary by Category Two-Wheeled Fuel Motorcycles - June total sales: 1.495 million units, +8.0% YoY; exports: 1.115 million units, +17.6% YoY; domestic sales: 380,000 units, -12.8% YoY [4][9] - Cumulative sales for the first half of the year reached 8.3375 million units, a 15% increase YoY [4] 250cc and Above - June sales: 103,000 units, +14.3% YoY; exports: 57,000 units, +59.9% YoY; domestic sales: 46,000 units, -15.6% YoY [4][9] - Cumulative sales for the first half of the year reached 502,000 units, a 41% increase YoY [4] Electric Motorcycles - June sales: 31,000 units, +2192.0% YoY; cumulative sales for the first half of the year reached 123,900 units, +1489% YoY [4][18] All-Terrain Vehicles - June sales: 18,000 units, +5.8% YoY; cumulative sales for the first half of the year reached 90,600 units, +7% YoY [4][18]

Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [4][6]. Core Insights - Longxin General has established itself as a leader in the motorcycle industry in China, with a successful transition from "product export" to "brand export" through its high-end motorcycle brand "VOGE" [2][14]. - The company is expected to become the largest motorcycle enterprise in China and rank among the top globally following the integration of its operations with Zongshen Group [2][14]. - The brand "Wuji" has positioned itself as a leader in the high-end motorcycle segment, achieving a market share of 14.2% for motorcycles above 250cc in 2024, a 5 percentage point increase from 2022 [3][4]. Financial Performance - The company reported a revenue of 16.82 billion yuan in 2024, a year-on-year increase of 29%, with a net profit of 1.12 billion yuan, up 92% [16][29]. - The forecast for net profit from 2025 to 2027 is 1.90 billion yuan, 2.37 billion yuan, and 2.77 billion yuan, representing growth rates of 70%, 25%, and 17% respectively [4][16]. - The company's earnings per share (EPS) is projected to increase from 0.93 yuan in 2025 to 1.35 yuan in 2027 [4][16]. Brand Competitiveness - Wuji has successfully launched several popular models, including SR150GT and DS900X, and has gained significant recognition in the European market, with over 95% of its 800cc motorcycle exports going to Europe in 2024 [3][4]. - The partnership with BMW since 2005 has enhanced the company's quality control capabilities, facilitating its entry into the European market [3][4]. - The company has focused on brand rejuvenation and increased marketing efforts, with advertising expenses projected to reach 80 million yuan in 2024, a 96% increase year-on-year [3][4]. Market Trends - The motorcycle export market has shown significant growth, with a projected export value of 8.716 billion USD in 2024, a 24.75% increase from the previous year [54][60]. - The company has been expanding its presence in emerging markets, particularly in Latin America and Africa, where demand for motorcycles is increasing [106][108]. - The European motorcycle market is stable and growing, with a market size of approximately 16.3 billion USD in 2023, driven by high demand for large displacement motorcycles [87][92].

Core Viewpoint - The performance of low-altitude economy companies in the first half of 2025 shows mixed results, with 12 companies reporting profits and 12 companies experiencing losses [3][5]. Group 1: Performance Overview - As of July 14, 2025, 24 companies in the low-altitude economy index disclosed their performance forecasts, revealing a split between profitable and loss-making entities [3]. - Among the 24 companies, 12 reported profits while the other 12 faced losses [3]. - Four companies are expected to see profit increases of over 50%: Zongshen Power (001696.SZ), Longxin General (603766.SH), Huijia Times (603101.SH), and Changyuan Donggu (603950.SH) [6]. Group 2: Profit and Loss Analysis - Companies such as Aerospace Development (000547.SZ) and Aerospace Rainbow (002389.SZ) reported losses, with the latter citing delays in delivery due to user demand plans [8]. - Aerospace Power (600893.SH) and Aerospace Electric (002025.SZ) achieved profitability but saw a decline in net profit compared to the previous year [6]. - North Navigation (600435.SH) turned a profit, expecting a net profit of 105 million to 120 million yuan in the first half of 2025 [7]. Group 3: Industry Challenges - Many companies in the low-altitude economy sector, particularly those in the aviation industry and low-altitude mainframe manufacturers, reported losses [5][8]. - The losses were attributed to various factors, including market environment impacts, product transformation challenges, and increased operational costs [9]. - Despite ongoing losses, some companies like Chuan University Zhisheng (002253.SZ) are actively pursuing low-altitude economy projects, indicating a commitment to future growth [9].

Core Viewpoint - Longxin General (隆鑫通用) is experiencing significant growth in its operating performance, with a projected net profit increase of 70.52% to 90.03% for the first half of 2025 compared to the previous year [1][2]. Financial Performance - The company expects to achieve a net profit of 10.05 billion to 11.2 billion yuan for the first half of 2025, driven by growth in motorcycle and general machinery businesses [2]. - In 2024, Longxin General reported a revenue of 168.22 billion yuan, a year-on-year increase of 28.74%, and a net profit of 11.21 billion yuan, up 92.19% [2]. - For Q1 2025, the company achieved a revenue of 46.46 billion yuan, a 40.98% increase year-on-year, with a net profit of 5.07 billion yuan, reflecting a growth of 96.79% [3]. Business Segments - Longxin General has a strong focus on the "motorcycle + general machinery" business model, which has led to a steady increase in gross margin from 13.77% in 2021 to 17.59% in 2024, reaching 18.9% in Q1 2025 [1][5]. - The motorcycle segment generated sales of 126.88 billion yuan in 2024, a 34.01% increase, with the "Wuji" series products achieving sales of 31.54 billion yuan, up 111.43% [6]. - The general machinery segment reported sales of 35.35 billion yuan in 2024, a 29.32% increase, driven by customer demand and technological development [6]. Research and Development - Longxin General has invested a total of 21.24 billion yuan in R&D over the past five years, with annual expenditures increasing from 3.06 billion yuan in 2020 to 5.13 billion yuan in 2024 [6]. - The company holds 1,591 valid patents, including 350 invention patents, showcasing its strong R&D capabilities and industry leadership [6]. Financial Structure - As of the end of Q1 2025, Longxin General's total assets reached 170.4 billion yuan, a 6.04% increase from the previous year, with a net cash flow from operating activities of 10.21 billion yuan [5][6].

Group 1 - A total of 31 buy ratings were issued by institutions today, covering 20 stocks, with Yanjing Beer receiving the highest attention, garnering 8 buy ratings [1][2] - Among the stocks rated, 6 have an upside potential exceeding 20%, with Longxin General leading at 50.76% based on a target price of 19.96 yuan [1][2] - The average increase for stocks with buy ratings today was 2.13%, outperforming the Shanghai Composite Index, with notable gainers including Lexin Technology and Pengding Holdings [1][2] Group 2 - Seven stocks among those rated have released their half-year performance forecasts, with Lier Chemical expecting a net profit growth of 190.62%, followed by Zongshen Power and Longxin General with expected growths of 85.00% and 80.28% respectively [2] - The electronics sector is the most favored, with five stocks including Industrial Fulian and Allwinner Technology making the buy rating list, while machinery and basic chemicals also received attention with four and two stocks respectively [2][3] - The buy ratings include various institutions, with notable mentions such as Softcom Power and Yanjing Beer, which have received multiple buy ratings from different firms [3]

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].

Key Insights - The report highlights a recovery in the real estate market, with new home sales showing slight improvement while the second-hand home market remains subdued. Price stabilization is anticipated, with land premium rates at low levels [2][4] - The fixed income market is expected to remain strong, particularly in credit bonds, with a focus on medium to high-grade industrial bonds and city investment bonds for investment opportunities [3][5] - The international fertilizer prices have risen significantly, driven by increased global planting areas and limited new production capacity, benefiting domestic leading companies in the fertilizer sector [4] - The transportation sector is experiencing a mixed performance, with passenger transport profitability improving due to strong travel demand, while freight transport shows divergence in profitability across different segments [5][6] - The automotive industry is entering a phase of consolidation, with a focus on key players in the humanoid robot market, as technological advancements continue to drive market confidence [6][7] - The communication sector is projected to see a 7% year-on-year increase in net profit for the second quarter, with strong performance expected from telecom operators and the optical communication segment [8] Fixed Income - The credit bond market is expected to continue its upward trend, with a focus on long-term investments and opportunities in high-quality city investment bonds [3] - Investors are advised to consider extending duration in their portfolios and to look for wave opportunities in the credit market [3] Fertilizer Industry - International fertilizer prices have increased by 42% for urea, 24% for diammonium phosphate, and 23% for potash since the beginning of the year, while domestic prices show a mixed trend [4] - The report recommends companies like Hualu Hengsheng and Xingfa Group as beneficiaries of the improving fertilizer demand and profitability [4] Transportation Sector - The second quarter is expected to show improved profitability in passenger transport, particularly in aviation and railways, driven by strong travel demand [5] - Freight transport profitability is mixed, with some segments experiencing growth while others face challenges due to competition and demand fluctuations [5] Automotive Industry - The humanoid robot market is shifting towards a more competitive landscape, with a focus on companies that have strong supply chain orders and innovative technology [6] - The report suggests that the market will increasingly favor companies with significant advancements in technology and production capabilities [6] Communication Sector - The communication sector is expected to see a 7% increase in net profit, with strong growth in the optical communication and IDC segments [8] - The report highlights the potential for continued expansion in the communication industry, driven by domestic and international demand [8]

Group 1: Company Performance - Wanwei High-tech expects a net profit of 235 million to 265 million yuan for the first half of 2025, representing a year-on-year increase of 81.34% to 104.48% [1] - Jin Guan Electric has won bids for projects from Southern Power Grid and Guangxi Power Grid, with a total bid amount of approximately 42.81 million yuan, accounting for 5.76% of the company's 2024 revenue [2] - Ankai Bus reported a June vehicle sales increase of 37.88% year-on-year, with a total production of 814 vehicles, a 52.23% increase [4] - Daqin Railway's June cargo transport volume increased by 5.29% year-on-year, totaling 32.42 million tons [5] - Xianggang Technology anticipates a net profit of 75 million to 85 million yuan for the first half of 2025, a year-on-year increase of 410% to 478% [9] - Longxin General expects a net profit of 1.005 billion to 1.12 billion yuan for the first half of 2025, a year-on-year increase of 70.52% to 90.03% [10] - Le Xin Technology forecasts a net profit of 250 million to 270 million yuan for the first half of 2025, a year-on-year increase of 65% to 78% [11] - I-Le Furniture expects a net profit of 80 million to 99 million yuan for the first half of 2025, a year-on-year increase of 76.08% to 117.90% [13] - Shennong Group sold 219,000 pigs in June, generating sales revenue of 385 million yuan [14] - Guohuo Airlines anticipates a net profit of 1.187 billion to 1.267 billion yuan for the first half of 2025, a year-on-year increase of 78.13% to 90.14% [45] Group 2: Industry Developments - The electric power equipment industry is seeing increased project bids, as evidenced by Jin Guan Electric's recent contracts [2] - The automotive industry is experiencing growth, with Ankai Bus reporting significant increases in both production and sales [4] - The railway transportation sector is showing resilience with Daqin Railway's cargo transport volume growth [5] - The pharmaceutical industry is advancing with clinical trial approvals, such as Wanbang's WP107 oral solution for treating myasthenia gravis [6] - The packaging and printing industry is witnessing substantial profit growth, as indicated by Xianggang Technology's performance forecast [9] - The agricultural sector, particularly in pig farming, is maintaining steady sales figures, as shown by Shennong Group's sales data [14]

Group 1 - The company forecasts a net profit attributable to shareholders of the parent company for the first half of 2025 to be between 1,005 million yuan and 1,120 million yuan, representing an increase of 415.62 million yuan to 530.62 million yuan compared to the same period last year, which is a year-on-year increase of 70.52% to 90.03% [1][2] - The net profit attributable to shareholders of the parent company, excluding non-recurring gains and losses, is expected to be between 965 million yuan and 1,080 million yuan, reflecting a year-on-year increase of 70.35% to 90.65% [2] - The main reason for the profit increase is the continuous optimization of the product structure, leading to overall performance growth [2] Group 2 - The previous year's total profit was 695.32 million yuan, with a net profit attributable to shareholders of the parent company of 589.38 million yuan [2] - The earnings per share for the previous year were 0.2870 yuan per share [2]