JACK(SH:603337) CMS·2025-07-10 09:51Investment Rating - The report gives a "Strong Buy" investment rating for the company [1][9]. Core Insights - The industrial sewing machine industry exhibits significant cyclicality, with Jack's performance surpassing the industry in each upcycle, establishing itself as a global leader. The company is expected to continue increasing its market share through superior product capabilities and is actively promoting automation and unmanned transformation, indicating substantial growth potential [1][6][9]. Summary by Sections Industrial Sewing Machine Industry: Cyclical Fluctuations and Demand Divergence - The industrial sewing machine industry in China has experienced two phases: a growth phase from 1999 to 2007 and a cyclical phase from 2008 to present. The current cycle began to recover in Q3 2023, with production expected to reach 6.85 million units in 2024, a year-on-year increase of 22.32% [6][14]. - Domestic demand is anticipated to face pressure in 2025, while overseas markets are expected to remain supported by inventory replenishment and supply chain restructuring [6][24]. Jack's Competitive Positioning - Jack is the global leader in the industrial sewing machine market, with a market share exceeding 30%. The company has successfully implemented a "fast response king" and "over梗 king" product strategy, focusing on high-demand products to enhance efficiency and profitability [6][32][52]. - The average selling price of Jack's industrial sewing machines is projected to rise from 2,195.6 yuan/unit in 2021 to 2,481.7 yuan/unit in 2024, contributing to an increase in gross margin from 23% to 31.28% during the same period [6][38]. Future Trends and Innovations - Jack is at the forefront of the trend towards automation and unmanned production in the sewing industry, addressing labor shortages and enhancing digital transformation. The company has launched a digital integrated solution and is exploring unmanned solutions to facilitate machine replacement for human labor [7][55][60]. - The introduction of high-end AI sewing machines and robotic systems is expected to further solidify Jack's competitive edge and open new growth avenues [7][61]. Financial Data and Valuation - Projected total revenue for Jack is expected to reach 71.64 billion yuan in 2025, with a year-on-year growth of 18%. The net profit attributable to shareholders is forecasted to be 9.73 billion yuan, reflecting a 20% increase [8][9]. - The company's PE ratio is projected to decrease from 30.9 in 2023 to 17.1 in 2025, indicating an attractive valuation as the company continues to grow [8][9].