Core Viewpoint - Haike New Source has signed a three-year long-term cooperation agreement with BYD Lithium Battery, securing a minimum annual supply of 100,000 tons of electrolyte solvents, which is expected to stabilize its revenue despite ongoing net losses [1][2]. Group 1: Cooperation Agreement - The agreement with BYD Lithium Battery is based on a pipeline transportation model, which allows for a close physical connection and significantly reduces logistics costs and safety risks [2]. - The cooperation involves four key electrolyte solvents: Dimethyl Carbonate (DMC), Ethylene Carbonate (EC), Ethyl Methyl Carbonate (EMC), and Diethyl Carbonate (DEC), which are crucial for lithium-ion battery production [2]. Group 2: Financial Performance - In 2024, Haike New Source reported total revenue of 3.615 billion yuan, a year-on-year increase of 7.49%, but net profit fell sharply to a loss of 267 million yuan, a decline of 944.35% [4]. - By the third quarter of 2025, the company achieved revenue of 3.653 billion yuan, a significant year-on-year growth of 43.17%, yet still reported a net loss of 128 million yuan [5]. - The company has faced challenges with increasing competition and declining product prices, which have adversely affected profit margins [4][5]. Group 3: Strategic Implications - The partnership with BYD may help alleviate the issue of low operational load at the Hubei project, potentially improving profit margins by spreading fixed costs over a larger volume of sales [5]. - However, this deepened reliance on a single major client could also increase the company's exposure to pricing power risks [5].