HONGLU(SZ:002541) Changjiang Securities·2025-07-02 15:18Investment Rating - The investment rating for the company is "Buy" and is maintained [11]. Core Viewpoints - The recent expectations of anti-involution in the steel industry have increased, leading to a rebound in steel prices. The government is focusing on promoting a unified national market and addressing low-price competition, which is expected to alleviate downward pressure on steel prices and help industry profits return to reasonable levels [12][13]. - The company's profitability is closely tied to steel prices, with a pricing model based on steel prices plus processing fees. If steel prices stabilize and recover, the company's profitability per ton is expected to gradually improve [12][13]. - The company has made positive changes in sales and automation this year, achieving a year-on-year increase in orders through strategic adjustments and increased investment in intelligent manufacturing equipment [12][13]. - The company currently has a safety margin, and under conservative assumptions, its market value may represent a safe bottom. With the potential for mid-term improvements from automation and a recovery in steel prices, the company is seen as a high-performance and high-odds investment opportunity [12][13]. Summary by Sections Company Basic Data - Current stock price is 17.65 CNY, with a total share capital of 69,001 million shares and a net asset per share of 13.71 CNY. The highest and lowest prices in the last 12 months were 21.50 CNY and 10.68 CNY respectively [11]. Financial Projections - Projected total revenue for 2025 is 25,247 million CNY, with a gross profit of 2,688 million CNY, maintaining a gross margin of approximately 11% [17]. - The net profit for 2025 is estimated at 930 million CNY, with earnings per share (EPS) projected to be 1.35 CNY [17]. - The company is expected to see a significant increase in cash flow from operating activities, projected at 1,064 million CNY for 2025 [17].