Huarui Precision(SH:688059) Shanghai Securities·2025-08-19 10:23Investment Rating - The investment rating for the company is "Buy" (maintained) [2][5] Core Views - The company reported strong performance in H1 2025, with revenue of 519 million yuan, a year-on-year increase of 26.48%, and a net profit attributable to shareholders of 85 million yuan, up 18.80% year-on-year [2][3] - The revenue growth was driven by recovering downstream demand, improved product performance, and an expanding product range [3] - The company is actively expanding its product offerings in emerging fields such as aerospace and robotics, focusing on precision cutting tools [4] Summary by Sections Financial Performance - In H1 2025, the company achieved a revenue of 519 million yuan, with a year-on-year growth of 26.48%. The net profit attributable to shareholders was 85 million yuan, reflecting an 18.80% increase year-on-year [2] - For Q2 2025, the company reported a revenue of 297 million yuan, a year-on-year increase of 23.65% and a quarter-on-quarter increase of 33.73% [2] - The gross margin for H1 2025 was 37.54%, down 5.05 percentage points year-on-year, attributed to rising raw material costs and pressure on overall tool business profitability [3] Revenue and Profitability - The main business revenue for H1 2025 was 513 million yuan, up 25.80% year-on-year, with the CNC blade and overall tool segments generating revenues of 449 million yuan and 54 million yuan, respectively [3] - The company’s net profit margin for H1 2025 was 16.46%, a decrease of 1.07 percentage points year-on-year [3] Cost Management - The expense ratio for H1 2025 was 15.19%, down 5.4 percentage points year-on-year, indicating improved cost control [3] Market Expansion - The company is enhancing its sales system by optimizing a dual-channel approach of "distribution + direct sales," which includes strengthening its distribution network and expanding its direct sales team [4] - In H1 2025, overseas revenue reached 28 million yuan, a year-on-year increase of 20.62% [4] Future Projections - The company is expected to achieve revenues of 1.01 billion yuan, 1.17 billion yuan, and 1.39 billion yuan for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 33.01%, 16.03%, and 18.62% [5] - Projected net profits for the same years are 169 million yuan, 218 million yuan, and 274 million yuan, with growth rates of 57.90%, 29.35%, and 25.55% [5]