Investment Rating - The report maintains an "Outperform" investment rating for the company [2][7]. Core Insights - The company's performance in the first half of 2025 was below expectations, with a revenue of 385 million yuan, a year-on-year decline of 36%, and a net profit attributable to shareholders of -36 million yuan, indicating a significant downturn [7]. - The company is diversifying its sales channels, with the "Light and Easy" brand expected to contribute incremental revenue. The company has established 125 direct-operated stores globally, focusing on high-traffic areas [7]. - The gross profit margin improved to 64.09% in Q2 2025, up 3.17 percentage points year-on-year, primarily due to the higher margin from the "Light and Easy" stores [7]. Financial Data and Earnings Forecast - Total revenue projections for 2025 are set at 984 million yuan, with a year-on-year decline of 9.3%. The net profit forecast for 2025 is 49 million yuan, reflecting a significant recovery from the previous year's losses [6][9]. - The earnings per share (EPS) is expected to be 0.57 yuan for 2025, with a projected growth of 373.6% year-on-year [6][9]. - The company anticipates a gradual recovery in profitability, with net profits expected to reach 78 million yuan in 2026 and 93 million yuan in 2027 [6][9].

Core Insights - The car wash liquid industry is experiencing significant growth driven by increasing car ownership and changing consumer attitudes towards vehicle maintenance, with a market size projected to grow from 2.17 billion yuan in 2016 to 4.48 billion yuan by 2024, reflecting a compound annual growth rate (CAGR) of 9.5% [1][12] - The demand for car wash services is rising as consumers are willing to invest more time and money in vehicle maintenance, adopting the philosophy of "maintaining instead of repairing" [1][12] - The development of self-service car wash models is creating new opportunities for the car wash liquid industry, catering to diverse consumer needs [1][12] Industry Overview - Car wash liquid is primarily composed of natural plant-derived surfactants, featuring a neutral formula that includes natural wax and anti-static components, providing cleaning and paint protection functions [2] - The industry is supported by rising disposable income and consumer spending in China, with per capita disposable income expected to increase from 32,189 yuan in 2020 to 41,314 yuan in 2024 [4] Industry Chain - The upstream of the car wash liquid industry includes key components such as surfactants, corrosion inhibitors, and lubricants, with surfactants being the core ingredient [6] - The midstream involves the production and manufacturing of car wash liquids, while the downstream encompasses sales channels including e-commerce platforms, supermarkets, and auto supply stores [6] Market Dynamics - The car wash liquid market in China is characterized by a multi-tiered competitive landscape, with international brands like 3M and Sonax dominating the high-end market, while domestic companies like Haoshun and Guangdong Weishi compete in the mid-range market [14] Future Trends - There is a growing consumer demand for environmentally friendly car wash liquids, which will likely become mainstream products, utilizing biodegradable materials and low volatile organic compounds (VOCs) [19] - The trend towards personalized and customized car wash products is expected to rise, allowing companies to meet specific consumer needs [19] - The sales channels for car wash liquids are anticipated to accelerate the integration of online and offline platforms, with e-commerce becoming a significant sales avenue while maintaining the importance of offline experiences [19]