Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company experienced a decline in performance due to pressure in the railway and highway market, but there was a quarter-on-quarter improvement in revenue in Q2 2025. The H1 2025 revenue was 384 million, with a year-on-year decrease of 5%, while Q2 2025 revenue was 211 million, showing a quarter-on-quarter increase of 22% [2] - The company is focusing on tunnel construction and mining, achieving significant growth in these sectors. In H1 2025, mining revenue increased by 183% year-on-year, while water conservancy revenue grew by 73% [3] - The company is optimistic about the long-term growth potential from the Yaxia hydropower project, with a total investment of approximately 1.2 trillion. The company is expected to benefit from increased demand for its products as the project enters its peak construction phase [4] Summary by Sections Financial Performance - H1 2025 total revenue was 384 million, with a net profit of 51 million, reflecting a year-on-year decline of 27%. The Q2 2025 revenue was 211 million, with a net profit of 19 million, showing a quarter-on-quarter increase in revenue but a decline in net profit [2] - The gross margin for H1 2025 was 31.73%, down 14.75 percentage points year-on-year, while the net profit margin was 13.27%, down 22.86 percentage points year-on-year [2] Business Focus - The company is concentrating on tunnel construction and mining, with a focus on small and medium-sized mines, achieving a revenue of 45.82 million in H1 2025, up 183% year-on-year [3] - In the water conservancy sector, the company has developed innovative intelligent construction equipment, generating 31.54 million in revenue in H1 2025, a 73% increase year-on-year [3] M&A and Future Prospects - The company is in the process of acquiring 100% equity of Wuxin Heavy Industry and Xingzhong Technology, with the review of the transaction resuming. This acquisition is expected to enhance the company's capabilities in the water conservancy and mining sectors [4] - The company maintains a profit forecast for 2025-2027, with net profits projected at 1.21 billion, 1.44 billion, and 1.70 billion respectively, corresponding to a P/E ratio of 49.40, 41.54, and 35.28 [4]
五新隧装（835174）：并购交易事项恢复审核，看好雅下水电工程建设长期增量