Changjiang Securities·2025-08-26 14:15Investment Rating - The investment rating for the company is "Buy" and is maintained [9]. Core Views - The company reported significant growth in its H1 2025 performance, with a revenue of 1197.58 billion yuan, representing a year-on-year increase of 32.99%. The net profit attributable to shareholders was 72.46 billion yuan, up 72.48%, and the net profit excluding non-recurring items was 66.61 billion yuan, reflecting a growth of 98.25% [6][2]. - The outlook for 2025 indicates continued growth in the high-speed train business, improvement in locomotive operations, and development in urban rail and new industries, suggesting a sustained upward trend in the company's operations [2][11]. Summary by Sections Financial Performance - In H1 2025, the company achieved a total revenue of 1197.58 billion yuan, a 32.99% increase year-on-year. The net profit attributable to shareholders was 72.46 billion yuan, marking a 72.48% increase, while the net profit excluding non-recurring items reached 66.61 billion yuan, up 98.25% [6][2]. - The railway equipment business generated revenue of 597 billion yuan, a 42% increase, driven by growth in high-speed trains and freight cars. Urban rail and city infrastructure revenue was 174 billion yuan, up 6%, and new industry revenue was 407 billion yuan, reflecting a 36% increase [11][11]. Profitability Metrics - The overall gross margin for H1 2025 was 21.81%, an increase of 0.40 percentage points year-on-year. The gross margins for railway equipment, urban rail, new industries, and modern services were 25.17%, 18.86%, 17.74%, and 30.86%, respectively [11][11]. - The net profit margin for H1 2025 was 7.45%, an increase of approximately 1.3 percentage points compared to H1 2024 [11]. Market Outlook - The railway passenger and freight transport sectors are experiencing high demand, with passenger volume reaching 2.691 billion, a 6.7% increase year-on-year. Freight transport also showed a positive trend, with 4.52 million tons transported in July, up 4.5% [11][11]. - The company is committed to international expansion, leveraging opportunities from the Belt and Road Initiative and enhancing its global market presence [11][11]. Dividend Policy - The company announced a mid-term cash dividend of 1.1 yuan per 10 shares, totaling 31.57 billion yuan, which represents 43.57% of the net profit attributable to shareholders for H1 2025 [11][11]. Future Projections - The company is expected to achieve net profits of 147 billion yuan and 164 billion yuan for 2025 and 2026, respectively, with corresponding price-to-earnings ratios of 15.0 and 13.4 [11][11].