Core Viewpoint - Jiangsu Shentong (002438) announced on November 6 that its cost structure consists of approximately 60%-80% materials, 10%-20% labor costs, and 5%-10% manufacturing expenses, with steel accounting for about 75% of material costs. The company's pricing strategy is based on a cost-plus model, benefiting from long-term production and delivery experience, and the gross margin for its nuclear power valve products is currently stable, with expectations for continued stability under unchanged business models and market competition dynamics [1]. Cost Structure - Materials account for approximately 60%-80% of total costs [1] - Labor costs represent about 10%-20% of total costs [1] - Manufacturing expenses make up 5%-10% of total costs [1] - Steel constitutes around 75% of the material costs [1] Pricing Strategy - The company employs a cost-plus pricing strategy [1] - This strategy is supported by the company's long-term production and delivery experience [1] Gross Margin - The gross margin for nuclear power valve products is currently at a relatively stable level [1] - It is expected that the gross margin will continue to remain stable, assuming no significant changes in the business model or market competition [1]

Core Viewpoint - Jiangsu Shentong (002438) emphasizes the continuous improvement of nuclear energy application technology and safety performance in China, leading to higher performance requirements for nuclear power ball valves and butterfly valves [1] Group 1: Technology Advancements - The company is actively following advancements in nuclear energy application technology, particularly in the development of ball valves and butterfly valves for third and fourth generation nuclear power [1] - Significant investments in human and financial resources have been made to track the technological routes for these valves [1] Group 2: Product Testing and Validation - Jiangsu Shentong has successfully passed the testing and certification for the ball valves and butterfly valves used in the Hualong One nuclear reactor [1] - This achievement lays a solid foundation for the company's future market applications in new project constructions [1]

Core Viewpoint - The announcement from Jiangsu Shentong indicates that controlled nuclear fusion will significantly impact the valve industry through technological upgrades and increased market demand [1] Group 1: Impact of Controlled Nuclear Fusion - The global industrialization of controlled nuclear fusion is accelerating, with nuclear fusion experimental reactors reaching critical development stages [1] - Valves as a supporting industry will need to meet extreme operational requirements due to the nature of controlled nuclear fusion [1] - If controlled nuclear fusion achieves commercialization, the valve industry is expected to experience long-term opportunities [1]

Group 1 - Jiangsu Shentong (SZ 002438) announced that on November 6, 2025, it will be receiving a research visit from Shanxi Securities, with Vice President Zhang Qiqiang participating in the reception and addressing investor inquiries [1] - For the first half of 2025, Jiangsu Shentong's revenue composition is as follows: Nuclear power industry accounts for 38.37%, energy-saving and environmental protection industry for 18.78%, metallurgy industry for 18.45%, energy equipment industry for 17.05%, and other businesses for 7.35% [1] - As of the report date, Jiangsu Shentong's market capitalization is 7.5 billion yuan [1]

Group 1: Investor Relations Activity - The investor relations activity involved a site visit by institutional investors to discuss the company's production operations, future development plans, and strategies [2] Group 2: Participants and Attendance - Participants included major investment firms such as Capital, Fidelity, Monolith Management, and others [2] - The meeting was attended by the company's Vice President, Mr. Zhang Qiqiang [2] Group 3: Date and Location - The investor relations activity took place on November 6, 2025, in the company's conference room [2]

Group 1: Market Overview - The nuclear power generation in China is expected to reach approximately 10% of the total energy mix by 2035, aligning with the global average [3] - The company has over 150,000 nuclear valves in operation, with a market share exceeding 90% for key products like nuclear butterfly and ball valves [3] - The nuclear valve market is projected to grow due to increasing demand for maintenance and repair services as more nuclear units come online [3] Group 2: Competitive Landscape - The nuclear valve industry is characterized by high entry barriers, including the need for design and manufacturing licenses, as well as stringent quality assurance requirements [5] - The company has established strong market competitiveness and brand influence in the nuclear sector, benefiting from a stable competitive environment [3] Group 3: Financial Aspects - The cost structure of nuclear valves consists of approximately 60-80% materials, 10-20% labor, and 5-10% manufacturing expenses, with steel accounting for about 75% of material costs [7] - The company's nuclear valve products maintain a stable gross margin, with expectations for continued stability under current business conditions [7] Group 4: Technological Advancements - The transition from Generation II to Generation III and IV nuclear technologies has increased performance requirements for valves, particularly in seismic resistance and radiation protection [8] - The company is actively investing in R&D to meet the evolving technical demands of new nuclear projects, having successfully tested valves for the Hualong One reactor [8] Group 5: Future Opportunities - The development of controllable nuclear fusion technology is anticipated to create long-term opportunities for the valve industry, driven by technological upgrades and increased market demand [9][10] - The company is expanding its international presence, focusing on core sectors like oil refining and gas extraction to enhance growth and technological advancement [11]

Group 1 - The company is actively involved in the research and supply of valves required for the nuclear power industry, particularly focusing on advanced technologies in nuclear energy applications [2] - The company has initiated the development and technical reserve of various valve products needed for thorium-based molten salt reactors [2]

Core Viewpoint - Jiangsu Shentong's Q3 2025 performance shows stable revenue growth and strategic focus on high-end valve manufacturing and nuclear power sectors, with a commitment to innovation and market expansion [1][2][3]. Financial Performance - Q3 2025 revenue reached 1.637 billion yuan, a year-on-year increase of 0.22% - Net profit attributable to shareholders was 234.34 million yuan, up 2.86% year-on-year [2]. Business Strategy - The company aims to consolidate its position in metallurgy, develop nuclear power, expand into petrochemicals, and enhance global outreach while focusing on high-end valve manufacturing [3]. - Future growth will be driven by investments in R&D, particularly in semiconductor equipment and hydrogen fuel technologies [3][9]. Production Capacity - New production capacity is expected to enter trial production in Q4 2025, with substantial output anticipated to begin in early 2026 [4][12]. - The high-end valve intelligent manufacturing project is projected to add 300-400 million yuan in annual output once fully operational [10]. Cash Flow - The net cash flow from operating activities for Q3 2025 was 54 million yuan, reflecting a significant year-on-year increase of 846.22% [8]. Market Position and Competition - The company maintains a strong competitive edge in the nuclear valve market, supported by ongoing R&D and participation in industry standards [12]. - The nuclear valve sector is expected to remain in a healthy competitive state due to the normalization of new project approvals and the deepening of domestic equipment localization [11]. Investment and Partnerships - The company holds a 13.76% stake in Hongpeng Aviation and plans to continue supporting its operations while adhering to investment management regulations [5]. - The company is actively expanding its export market presence, achieving significant progress in market access and certification [12].

Core Points - Jiangsu Shentong Valve Co., Ltd. announced that its wholly-owned subsidiary, Wuxi Flange Forging Co., Ltd., received approval from the National Nuclear Safety Administration to change the scope of its civil nuclear safety equipment manufacturing license [1][2] - The approval indicates that Wuxi Flange meets the necessary conditions for manufacturing civil nuclear safety equipment as per relevant regulations, enhancing its competitive edge in the nuclear flange and forging sector [1][2] - This change is expected to positively impact Wuxi Flange's future operations and market expansion, allowing the company to supply a wider variety of nuclear power products [2] Company Summary - Wuxi Flange will conduct civil nuclear safety equipment manufacturing activities according to the newly approved license scope, ensuring the quality of the manufactured equipment [2] - The approval reflects Wuxi Flange's comprehensive competitiveness in the nuclear power flange and forging manufacturing field, which is crucial for future business growth [2] - The company aims to leverage this opportunity to contribute more high-quality and reliable flanges and forgings for national nuclear power engineering projects [2]

Core Viewpoint - Jiangsu Shentong announced that its wholly-owned subsidiary, Wuxi Flange Forging Co., Ltd., has received approval from the National Nuclear Safety Administration to change the scope of its manufacturing license for civil nuclear safety equipment [2] Group 1 - The approval document is titled "Notice on Approving the Change of the Scope of Manufacturing License Activities for Civil Nuclear Safety Equipment of Wuxi Flange Forging Co., Ltd." [2] - The approval indicates a significant regulatory milestone for Wuxi Flange, potentially expanding its operational capabilities in the nuclear safety sector [2]