FENGHUA(SZ:000636) Guotou Securities·2025-08-22 12:31Investment Rating - The report maintains a "Buy-A" investment rating for the company with a target price of 18.33 CNY, based on a PE valuation method of 44 times for 2025 [4][5]. Core Insights - The company achieved record high production and sales in its main products during the first half of 2025, with a revenue increase of 15.92% year-on-year to 2.772 billion CNY [1][2]. - Despite the revenue growth, the net profit attributable to shareholders decreased by 19.5% year-on-year to 167 million CNY, indicating challenges in profitability [1]. - The company is expanding its presence in emerging markets, with significant sales growth in automotive electronics (+39%), communications (+22%), and industrial control (+21%) sectors [2]. Financial Performance Summary - For the first half of 2025, the company reported: - Revenue: 2.772 billion CNY, up 15.92% year-on-year - Net profit: 167 million CNY, down 19.5% year-on-year - Non-recurring net profit: 170 million CNY, down 22.41% year-on-year [1] - In Q2 2025, the company achieved: - Revenue: 1.498 billion CNY, up 12.36% year-on-year - Net profit: 102 million CNY, down 23.88% year-on-year [1][2]. Growth Projections - The company is projected to achieve revenues of 5.828 billion CNY, 6.656 billion CNY, and 7.521 billion CNY for the years 2025, 2026, and 2027 respectively, with net profits of 482 million CNY, 650 million CNY, and 788 million CNY for the same years [4][9].