SERES(SH:601127) EBSCN·2025-09-04 05:43Investment Rating - The report maintains a "Buy" rating for the company, highlighting confidence in its luxury car brand positioning and Huawei's support [3][6]. Core Insights - The company's 2Q25 performance shows a significant recovery, with a 12.4% year-on-year increase in revenue and a 56.1% increase in net profit, primarily driven by the sales ramp-up of the Wanjie M8 model [1][2]. - The company is focusing on high-end models, with the Wanjie M8 and M9 becoming the main sales drivers, capturing significant market shares in their respective price segments [2][3]. - The company is pursuing a multi-dimensional strategy that includes deepening technological capabilities, global expansion, and advancements in robotics, which are expected to enhance long-term competitiveness [3]. Summary by Sections Financial Performance - In 1H25, the company's revenue decreased by 4.1% year-on-year to 624.0 billion CNY, while net profit increased by 81.0% to 29.4 billion CNY. In 2Q25, revenue rose by 12.4% year-on-year and 125.9% quarter-on-quarter to 432.5 billion CNY, with net profit increasing by 56.1% year-on-year and 193.3% quarter-on-quarter to 21.9 billion CNY [1]. - The company's vehicle sales in 1H25 fell by 15.8% to 199,000 units, with Wanjie sales down by 18.2% to 148,000 units. However, 2Q25 saw a 7.0% year-on-year and 90.5% quarter-on-quarter increase in vehicle sales to 130,000 units, with Wanjie sales up by 3.8% year-on-year and 122.3% quarter-on-quarter to 102,000 units [2]. Profitability and Growth - The company's gross margin improved by 3.9 percentage points year-on-year to 28.9% in 1H25, with a gross margin of 29.5% in 2Q25, reflecting a 2.0 percentage point year-on-year and 1.9 percentage point quarter-on-quarter increase [2]. - The report forecasts net profits of 92.5 billion CNY, 118.4 billion CNY, and 146.0 billion CNY for 2025E, 2026E, and 2027E respectively, indicating strong growth potential [3]. Strategic Initiatives - The company is enhancing its technological capabilities through a "software-defined vehicle" approach and has established a new paradigm for high-quality delivery with its "industrial brain + future factory" model [3]. - The company is actively pursuing global expansion, having established subsidiaries in Kazakhstan, Uzbekistan, and Mexico, and plans to issue H shares to support this strategy [3]. - A partnership with Beihang University to establish a robotics company is expected to leverage automotive manufacturing capabilities into the robotics sector [3].