Changjiang Securities·2025-08-01 08:15Investment Rating - The investment rating for the company is "Buy" and is maintained [9]. Core Views - The company reported a slight decline in revenue but an improvement in operating profit margin. For the first half of 2025, the company achieved operating revenue of 49.34 billion yuan, a year-on-year increase of 1.44%, and a net profit attributable to the parent company of 2.08 billion yuan, a year-on-year increase of 3.01% [2][6]. - In the second quarter of 2025, the company experienced a revenue decline of 2.60% year-on-year, with a net profit decrease of 8.25% [2][6]. - The company is focusing on optimizing its product structure and enhancing operational efficiency to achieve sustainable growth [12]. Summary by Sections Financial Performance - In H1 2025, the company reported a gross margin increase of 0.69 percentage points to 21.48%. The air conditioning segment saw a gross margin decrease of 1.56 percentage points, while the washing and refrigeration segment improved by 2.12 percentage points [12]. - The operating profit for H1 2025 was 2.63 billion yuan, a year-on-year increase of 9.67%, with an operating profit margin of 5.32%, up 0.40 percentage points [12]. - The company’s cash flow from operating activities increased by 153.43% year-on-year, indicating significant improvement in operational quality [12]. Business Segments - The air conditioning business grew by 4.07% year-on-year, while the washing and refrigeration business increased by 4.76%. Domestic sales saw a slight decline of 0.31%, whereas overseas sales grew by 12.34% [12]. - In Q2 2025, the company’s revenue decline was attributed mainly to weak domestic sales performance [12]. Future Outlook - The company aims to enhance its brand synergy and supply chain optimization to achieve efficient market penetration and rapid growth. It is also expanding into automotive compressor and thermal management systems [12]. - The projected net profits for 2025-2027 are 3.77 billion, 4.17 billion, and 4.71 billion yuan, respectively, with corresponding price-to-earnings ratios of 10.00, 9.03, and 7.99 [12].