GenTech(SH:688596) Changjiang Securities·2025-11-04 10:41Investment Rating - The investment rating for the company is "Buy" and it is maintained [8]. Core Views - The company reported a revenue of 1.275 billion yuan in Q3 2025, a year-on-year decrease of 22.68%. The net profit attributable to the parent company was -23 million yuan, down 110.12% year-on-year, and the non-recurring net profit was -37 million yuan, a decrease of 119.23% year-on-year. The gross margin was 18.03%, down 9.44 percentage points year-on-year [2][6]. - For the first three quarters of 2025, the company achieved a revenue of 3.292 billion yuan, a year-on-year decrease of 5.98%. The net profit attributable to the parent company was 71 million yuan, down 78.50% year-on-year, and the non-recurring net profit was 21 million yuan, a decrease of 93.11% year-on-year. The gross margin was 21.51%, down 5.66 percentage points year-on-year [2][6]. - The company is focusing on the semiconductor sector, with revenue from this area increasing from 50% in 2024 to 57% in the first half of 2025. Global capital expenditure (Capex) in the semiconductor industry is expected to grow significantly, with a forecasted increase of 7% in 2025, reaching 107 billion USD [11][12]. - The company has a robust order backlog, and its Capex business is expected to maintain steady growth. The Opex business is anticipated to open up new growth opportunities, contributing to revenue expansion and improved profitability [11][12]. Summary by Sections Financial Performance - In Q3 2025, the company reported a revenue of 1.275 billion yuan, a decrease of 22.68% year-on-year. The net profit was -23 million yuan, down 110.12% year-on-year, and the gross margin was 18.03%, down 9.44 percentage points [2][6]. - For the first three quarters of 2025, the total revenue was 3.292 billion yuan, a decrease of 5.98% year-on-year, with a net profit of 71 million yuan, down 78.50% year-on-year [2][6]. Market Outlook - The semiconductor industry is experiencing strong demand, with Capex and Opex expected to grow significantly in the coming years. The global semiconductor materials market is projected to reach approximately 70 billion USD in 2025, with a compound annual growth rate of 4.5% [11][12]. - The company is strategically expanding its Opex business, which is expected to increase its revenue share and enhance overall profitability [11][12]. Future Projections - The company is projected to achieve revenues of 6.68 billion yuan, 8.39 billion yuan, and 10.16 billion yuan from 2025 to 2027, with net profits of 470 million yuan, 720 million yuan, and 940 million yuan respectively. The corresponding price-to-earnings ratios are expected to be 21x, 13x, and 10x [11][12].