Summary of Conference Call Records Industry Overview - The global low-voltage electrical market is steadily recovering, with a market size of approximately 400 billion RMB in 2023, and a projected compound annual growth rate (CAGR) of about 6% over the next five years, driven by the demand for renewable energy generation and data center construction [1][3][4] - The low-voltage electrical market is dominated by international giants such as Schneider, ABB, and Siemens, while the domestic market is relatively fragmented, with companies like Chint and Liangxin making progress in technology accumulation and overseas business expansion [1][5] Key Insights and Arguments - Data center circuit breakers are crucial for power distribution systems, ensuring uninterrupted power supply. The trend towards intelligent integration in data center power distribution systems and the shift from AC to DC for backup UPS will further enhance the value of individual products [1][6][7] - The global market for low-voltage electronic products in data centers is expected to exceed 30 billion RMB by 2026-2027, with the penetration rate of DC low-voltage electronic products increasing from about 10% in 2025 to over 30% by 2027, driving up the overall product value [1][8] - Liangxin Electric has a comprehensive product line covering medium and low voltage distribution and control, with customized development for various industries such as wind power generation, photovoltaic charging, electric vehicle charging stations, 5G base stations, and data centers [1][9] Future Trends - The future development direction of data center power distribution systems includes modularization and intelligence, which can significantly reduce construction time and improve efficiency and reliability [2] - The global installed capacity of renewable energy generation is expected to reach 4.6 billion kilowatts by 2024, further pushing the transformation of low-voltage electrical products towards intelligence and digitalization [4] Competitive Landscape - The competitive landscape of the circuit breaker industry shows that while international brands hold a significant market share, domestic brands like Chint and Liangxin are gradually increasing their market presence due to improved technology and cost-effectiveness [5][12] - In 2023, the market share of domestic C23 enterprises is approximately 40%, and C25 enterprises around 50%, with Schneider holding about 15% and Liangxin around 5% [5] Product Innovations - Liangxin has launched a solid-state DC circuit breaker, which offers advantages such as short response time, no arc limitation, and long service life, expected to become the standard for 800V HVDC data centers [11] - The new solid-state circuit breaker is anticipated to be launched in the second half of 2026, significantly enhancing Liangxin's competitiveness in the market [11] Additional Insights - The penetration of DC low-voltage electronic products is expected to rise rapidly, with domestic market values for AC low-voltage products around 3 RMB per watt and DC products approximately 6 RMB per watt, indicating a higher value for DC products in overseas markets [8] - Liangxin's strategic partnerships with leading clients like Huawei and Weidi for customized components are aimed at expanding its market share in the context of increasing demand for DC and high-voltage products [10][12]

Market Overview - The grid equipment sector experienced a decline of 0.71% on the previous trading day, with Yada Co. leading the losses [1] - The Shanghai Composite Index closed at 3813.56, down 1.16%, while the Shenzhen Component Index closed at 12472.0, down 0.65% [1] Stock Performance - Notable gainers in the grid equipment sector included: - Zhengtai Electric: closed at 28.20, up 3.94% with a trading volume of 496,400 shares and a turnover of 1.383 billion yuan [1] - Yangdian Technology: closed at 21.46, up 3.37% with a trading volume of 107,100 shares and a turnover of 229 million yuan [1] - Kelun Electronics: closed at 6.78, up 3.04% with a trading volume of 783,900 shares and a turnover of 530 million yuan [1] - Conversely, Yada Co. saw a significant drop, closing at 12.58, down 10.08% with a trading volume of 168,800 shares and a turnover of 220 million yuan [2] Capital Flow - The grid equipment sector saw a net outflow of 731 million yuan from institutional investors, while retail investors contributed a net inflow of 510 million yuan [2] - Specific stock capital flows indicated: - Kelun Electronics had a net inflow of 70.19 million yuan from institutional investors, but a net outflow of 715 million yuan from retail investors [3] - Zhengtai Electric experienced a net inflow of 30.33 million yuan from institutional investors and a net inflow of 76.53 million yuan from retail investors [3]

Group 1 - The company is actively engaged in the research and development of new products, specifically low-voltage solutions for 400V and 800V HVDC systems [1] - The company aims to enhance its product layout capabilities and competitiveness to meet customer demands [1] - There are uncertainties in the market due to competition and fluctuations, which the company acknowledges [1] Group 2 - An investor inquired about the company's current 400V HVDC solutions for data center demands and future development paths for higher power solutions, including the latest 800V HVDC solutions from Nvidia [3]

Core Viewpoint - The company, Liangxin Co., announced the acquisition of multiple patents, indicating a strong focus on innovation and intellectual property development [1] Patent Achievements - The company and its subsidiaries have recently obtained a total of 6 invention patents, 72 utility model patents, and 9 design patents from the National Intellectual Property Administration [1]

Group 1 - Company announced the acquisition of 6 invention patents, 72 utility model patents, and 9 design patents from the National Intellectual Property Administration [1] - The patents include technologies such as "circuit breaker" and "arc extinguishing system for DC contactor" [1] - For the first half of 2025, the company's revenue composition is 100% from the industrial sector [1] Group 2 - The current market capitalization of the company is 12.9 billion yuan [1]

| 专利号 | | | 专利名称 | 专利类型 | 申请日 | | 有效期 | 证书号 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | ZL | 2020 | 1 1087357.X | 断路器 | 发明 | 2020-10-12 | 20 | 年 | 第 7934361 | 号 | | ZL | 2018 | 1 1049782.2 | 一种直流接触器的灭 弧系统 | 发明 | 2018-9-10 | 20 | 年 | 第 8033957 | 号 | | ZL | 2024 | 2 1798693.9 | 一种断路器装置 | 实用新型 | 2024-7-26 | 10 | 年 | 第 23090528 | 号 | | ZL | 2024 | 2 1864329.8 | 一种隔离开关的静触 头及灭弧室 | 实用新型 | 2024-8-2 | 10 | 年 | 第 22941617 | 号 | | ZL | 2024 | 2 1939300.1 | 一种断路器的脱扣机 构 | 实用新型 | 2024-8-9 | 10 | 年 ...

Core Viewpoint - The rapid development of AI globally has led to a surge in domestic computing power demand, creating significant market opportunities for AIDC (Artificial Intelligence Data Center) and transforming companies like Liangxin Co., Ltd. from traditional low-voltage electrical manufacturers to intelligent distribution solution providers [1][5]. Group 1: Company Performance - In the first half of 2025, Liangxin Co., Ltd. reported a revenue of 2.334 billion yuan, a year-on-year increase of 16.12%, and a net profit attributable to shareholders of 246 million yuan, up 4.11% year-on-year [2][4]. - The company's core business profitability improved significantly, with a net profit excluding non-recurring gains and losses reaching 224 million yuan, a substantial increase of 12.51% year-on-year [2]. Group 2: Market Position and Product Development - Liangxin Co., Ltd. has rapidly entered the top three in the global low-voltage ACB market, with a sales volume of over 250,000 units in 2024, surpassing many international brands and ranking first in the Chinese market [1]. - The company is focusing on the "Two Intelligence and One New" strategy (intelligent distribution, smart living, and new energy), aligning its R&D outcomes with the demands of emerging markets like AIDC [5][6]. Group 3: Financial Metrics - The company's operating costs increased by 17.26% to 1.596 billion yuan, while sales expenses rose by 8.27% to 193 million yuan [4]. - Research and development investment reached 154 million yuan, a 9.42% increase year-on-year, indicating a commitment to innovation [4]. Group 4: ESG Integration - Liangxin Co., Ltd. integrates ESG principles into its strategy, focusing on green production and energy management, with its Hangzhou Bay Super Factory recognized as a "National Green Factory" [8][12]. - The company achieved a clean energy usage of 4,705.14 MWh in 2024, with a green electricity usage ratio of 17% [8]. Group 5: Future Outlook - The ongoing project for the "Intelligent Low-Voltage Electrical R&D and Manufacturing Base" is expected to enhance production capacity and smart manufacturing levels, with an investment of 1.246 billion yuan by mid-2025 [12].

- The report does not contain any quantitative models or factors for analysis

Summary of Conference Call Records Companies and Industries Involved - **Ruijie Networks**: Focused on data center products and solutions for internet companies - **Liangxin Electric**: Concentrated on power distribution equipment in data centers - **China National Materials Technology**: Engaged in AI electronic fabrics and low-expansion products Key Points and Arguments Ruijie Networks 1. **Core Clientele**: Domestic internet companies are the core clients, with over 90% of data center product revenue coming from internet clients, primarily from major clients like Alibaba, ByteDance, and Tencent, which account for approximately 90% of revenue [1][2] 2. **Product Deployment**: The company's products supporting large-scale GPU clusters have been successfully deployed, with 400G products making up over 60% of data center switch revenue, amounting to approximately 2.4 billion [2] 3. **Collaboration with GPU Manufacturers**: The company is collaborating with several domestic GPU manufacturers to enhance their network capabilities, although commercial deployment will take time [3] Liangxin Electric 1. **Data Center Focus**: The company's data center strategy is concentrated on power distribution, with a market share primarily in HVDC and UPS systems [4] 2. **Overseas Market Advantage**: Liangxin has a competitive edge in the overseas market due to the demand for technical upgrades and the need for multiple suppliers due to existing capacity constraints of current suppliers [5] China National Materials Technology 1. **Complete Product Line**: The company has a comprehensive product line for AI electronic fabrics, with low-expansion products currently facing a supply-demand gap [8] 2. **Market Demand for Low-Expansion Products**: Low-expansion fabrics are widely used in large chip packaging and are expected to extend into consumer electronics and automotive sectors [9] 3. **Market Responsiveness**: The company plans to quickly respond to market demands and adjust pricing strategies based on market conditions and customer acceptance [10] Other Important Content - **Sector Diversification**: The renewable energy business unit includes solar, storage, and wind energy, with additional investments in nuclear and hydrogen sectors to mitigate cyclical volatility [7] - **Investment Caution**: The content includes a disclaimer emphasizing that the information provided is for reference only and does not constitute investment advice [11]

Investment Rating - The investment rating for the company is "Buy" and is maintained [6]. Core Views - The company reported a revenue of 2.33 billion yuan in the first half of 2025, representing a year-on-year increase of 16.1%. The net profit attributable to shareholders was 250 million yuan, up 4.1% year-on-year, while the net profit excluding non-recurring items was 220 million yuan, an increase of 12.5% year-on-year [2][4]. - In Q2 2025, the company achieved a revenue of 1.25 billion yuan, a year-on-year increase of 16.6%. The net profit attributable to shareholders was 140 million yuan, down 2.6% year-on-year, and the net profit excluding non-recurring items was 120 million yuan, up 9.9% year-on-year [2][4]. - The company’s revenue structure is diversified, with significant growth in various segments driven by demand from new energy, infrastructure, and digital energy sectors [9]. - The gross profit margin for the first half of 2025 was 31.59%, a decrease of 0.67 percentage points year-on-year. The gross profit margin for Q2 2025 was 31.63%, a decrease of 0.52 percentage points year-on-year but an increase of 0.07 percentage points quarter-on-quarter [9]. - The company effectively managed its expenses, with total expense ratio in the first half of 2025 at 20.02%, down 1.10 percentage points year-on-year [9]. - The company is actively expanding into new products and downstream markets, particularly in the data center sector, which is expected to provide new growth opportunities [9]. Financial Performance Summary - The company’s total revenue for 2025 is projected to be 5.08 billion yuan, with a net profit of 450 million yuan, corresponding to a PE ratio of approximately 28 times [9]. - The company’s cash flow from operating activities reached 171 million yuan in the first half of 2025, a year-on-year increase of 37.38% [9].