TOREAD(SZ:300005) Nan Fang Du Shi Bao·2025-12-02 12:12Core Viewpoint - The company is undergoing a significant transformation by acquiring two chip companies to complement its existing chip business, despite facing operational pressures and declining profits in its core outdoor business [2][7]. Acquisition Details - The company plans to spend a total of 678 million RMB to acquire 51% stakes in Shenzhen Betel and Shanghai Tongtu, with valuations showing a high premium over their net asset values [2][3]. - Betel's valuation is 650 million RMB, reflecting a 363% increase over its net asset value, while Tongtu's valuation is 703 million RMB, showing an astonishing 2119.65% increase [2][3]. Financial Performance - In the first three quarters of 2025, the company reported a revenue of 953 million RMB, a decrease of 13.98% year-on-year, and a net profit of 33.03 million RMB, down 67.53% [7]. - The outdoor business generated 538 million RMB in revenue, while the chip business brought in 115 million RMB during the first half of 2025 [8]. Company Background - Betel specializes in mixed-signal chip design, with products including fingerprint recognition and touch control chips, while Tongtu focuses on image and video processing technology, serving major clients like Huawei and OPPO [3][5]. - Both companies have performance commitments, requiring Betel to achieve a cumulative net profit of at least 150 million RMB over three years, and similar commitments for Tongtu [3][5]. Market Reaction - Following the announcement of the acquisitions, the company's stock price fell by 12.07%, indicating cautious market sentiment regarding the effectiveness of the dual-business strategy [8].