Nisco(SH:600282) HTSC·2025-08-21 03:38Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of RMB 7.25 [1][10]. Core Views - The company achieved a profit growth in H1 2025 despite a challenging operating environment in the steel industry, with a net profit of RMB 1.463 billion, representing an 18.63% year-on-year increase [7]. - The report anticipates that the implementation of anti-involution policies in the steel industry will further boost the company's performance [7][9]. Financial Performance - For H1 2025, the company reported revenue of RMB 28.944 billion, down 14.06% year-on-year, while Q2 revenue was RMB 14.592 billion, down 13.18% year-on-year but up 1.66% quarter-on-quarter [7]. - The company's high-end product sales reached 1.3372 million tons, accounting for 29.77% of total steel sales, with a gross margin of 20.26%, an increase of 2.32 percentage points year-on-year [8]. Industry Outlook - The steel industry is expected to see a recovery in profitability as the market bottomed out in Q3 2024, with a strategic shift towards anti-involution measures anticipated in 2025 [9]. - The average daily pig iron output in H1 2025 was approximately 2.355 million tons, a year-on-year increase of 3.4%, indicating that production cuts related to anti-involution policies have not yet been fully implemented [9]. Earnings Forecast - The company’s earnings per share (EPS) for 2025 is projected to be RMB 0.37, with expected EPS growth to RMB 0.45 in 2026 and RMB 0.49 in 2027 [6][10]. - The report maintains the profit forecast for the company, with net profit estimates of RMB 2.310 billion for 2025, RMB 2.745 billion for 2026, and RMB 3.029 billion for 2027 [6][10].