Investment Rating - The investment rating for the company is "Accumulate" (maintained) [1] Core Views - The company has achieved steady revenue growth, with a 20.96% year-on-year increase in revenue for the first three quarters of 2025, reaching 354 million yuan. However, net profit attributable to shareholders decreased by 25.40% year-on-year to 43 million yuan due to increased R&D investments and higher bad debt provisions [2] - The gross profit margin slightly improved to 30.90%, up 0.93 percentage points year-on-year, while the net profit margin decreased to 12.23%, down 7.79 percentage points, primarily due to increased R&D expenses and asset impairment losses [3] - The company has a good order backlog, with contract liabilities increasing to 314 million yuan by the end of Q3 2025, indicating strong order status. The net cash flow from operating activities significantly improved, increasing by 33.65% year-on-year to 98 million yuan, reflecting better cash collection management [4] Revenue and Profitability - For the first three quarters of 2025, the company reported total revenue of 354 million yuan, a 20.96% increase year-on-year, while net profit attributable to shareholders was 43 million yuan, a decrease of 25.40% year-on-year [2] - The company’s gross profit margin for the first three quarters was 30.90%, with a slight increase compared to the previous year, while the net profit margin was 12.23%, reflecting a decrease due to higher R&D costs [3] R&D and Product Development - The company has significantly increased its R&D investment, which rose by 46.62% year-on-year, leading to a higher R&D expense ratio of 11.32% [3] - The company is expanding into new product areas, including precision internal/external thread grinding machines and semiconductor precision grinding, indicating a strategic shift towards high-tech sectors [5] Financial Forecasts - The company’s revenue is projected to grow from 446 million yuan in 2024 to 984 million yuan in 2027, with a compound annual growth rate (CAGR) of 41.22% [12] - Net profit attributable to shareholders is expected to increase from 99 million yuan in 2025 to 219 million yuan in 2027, reflecting a strong growth trajectory [12]