Investment Rating - The investment rating for the company is "Buy" (maintained) [2] Core Views - The company reported a Q2 non-GAAP profit improvement, indicating a positive outlook for performance in the second half of the year [5][8] - The company achieved a revenue of 10.523 billion yuan in H1 2025, a year-on-year decrease of 4.39%, while the net profit attributable to the parent company was 154 million yuan, a year-on-year increase of 189.5% [5][7] - The Q2 revenue was 5.486 billion yuan, showing a quarter-on-quarter decrease of 4.1% but an increase of 8.9% year-on-year [5][8] Financial Data and Profit Forecast - The company’s total revenue for 2025 is projected to be 24.277 billion yuan, with a year-on-year growth rate of 9.1% [7] - The net profit attributable to the parent company for 2025 is estimated at 553 million yuan, with a projected growth rate of 82.8% for 2026 and 32.8% for 2027 [7] - The earnings per share (EPS) for 2025 is expected to be 0.44 yuan, increasing to 0.80 yuan in 2026 and 1.06 yuan in 2027 [7] - The company’s return on equity (ROE) is projected to improve from 3.1% in 2025 to 18.5% in 2027 [7] Business Segment Performance - The seating business revenue in H1 2025 reached 1.984 billion yuan, doubling from 0.897 billion yuan in the same period last year, although it reported a net loss of 63 million yuan [9] - The company anticipates that the seating business will turn profitable in the second half of 2025 due to increased production volumes from various models [9] - The integration of Grammer is expected to enhance profitability, with Q2 revenue from this segment at 466 million euros, reflecting a year-on-year decrease of 6.8% [8][9]

Investment Rating - The report maintains a "Recommended" rating for the company, with a current price of 41.02 CNY per share [5]. Core Views - The company reported a steady growth in Q1 2025, with a revenue of 433 million CNY, a year-on-year decrease of 24.0% and a quarter-on-quarter decrease of 44.4%. However, the net profit attributable to the parent company increased by 2.3% year-on-year and 14.9% quarter-on-quarter, attributed to lean production management and improved efficiency [1]. - The automotive seating business is expected to grow, with the core R&D team fully in place and a high-standard laboratory operational, engaging in deep cooperation with several well-known automotive companies [1][2]. - The company has expanded its customer base significantly, moving from the Lear system to covering mainstream Tier 1 suppliers, with new orders expected to contribute 6.059 billion CNY in revenue over five years, representing 53.2% of the company's total revenue in 2024 [2]. - The company is diversifying into railway container projects, having won a bid worth 587 million CNY, and is preparing for high-speed rail seating supply, which opens up long-term growth opportunities [3]. Summary by Sections Financial Performance - In Q1 2025, the company's gross margin reached 19.1%, an increase of 6.1 percentage points year-on-year, benefiting from product structure optimization and lean production improvements [2]. - The company’s revenue projections for 2025-2027 are 3.139 billion CNY, 4.091 billion CNY, and 5.114 billion CNY, respectively, with net profits of 204 million CNY, 297 million CNY, and 386 million CNY [4][3]. Customer Expansion - The company has established long-term partnerships with major automotive suppliers and has accelerated customer expansion, leading to multiple project confirmations and significant revenue contributions from new orders [2][3]. Growth Opportunities - The company is leveraging its position as a leader in automotive seating frames to capture market share and is actively expanding into seating assembly and railway sectors, which are expected to enhance its long-term growth potential [3].