WEIXING NBM(SZ:002372) Guotou Securities·2025-10-28 09:31Investment Rating - The report maintains an investment rating of "Buy-A" with a 12-month target price of 12.32 CNY, compared to the current stock price of 10.31 CNY [5]. Core Insights - The company reported a revenue of 3.367 billion CNY for the first three quarters of 2025, a year-on-year decrease of 10.76%. The net profit attributable to shareholders was 540 million CNY, down 13.52% year-on-year, while the non-recurring net profit decreased by 19.94% [1][9]. - The decline in revenue is attributed to a downturn in industry demand and intensified competition, with retail and engineering businesses facing pressure. However, the revenue decline in Q3 showed signs of narrowing compared to previous quarters [1][3]. - Investment income increased by 56 million CNY year-on-year, contributing positively to the non-recurring gains [1]. Financial Performance - The gross margin for the first three quarters was 41.47%, down 1.02 percentage points year-on-year, influenced by declining demand and competitive pressures. The net profit margin was 16.02%, a decrease of 0.78 percentage points [2]. - Operating cash flow showed a positive trend with a net inflow of 948 million CNY, reflecting a year-on-year growth of 16.66% [2]. Business Strategy and Market Position - The company is a leading player in the PPR pipe market, focusing on product and service innovation. It is accelerating the expansion of its "Concentric Circle" business and the implementation of the "Weixing Whole House Water Ecology" initiative [3]. - The engineering business is concentrating on core regions and high-quality clients, while the international business is leveraging the "Belt and Road" initiative to enhance market presence [3]. Earnings Forecast - The company is projected to achieve revenues of 5.699 billion CNY, 6.048 billion CNY, and 6.389 billion CNY for 2025, 2026, and 2027, respectively, with year-on-year growth rates of -9.05%, 6.12%, and 5.64% [9][10]. - The net profit forecasts for the same years are 824 million CNY, 886 million CNY, and 951 million CNY, with corresponding growth rates of -13.48%, 7.50%, and 7.32% [9][10].