Group 1: Competitive Strategy - The company focuses on customer core needs rather than price competition, emphasizing factors like delivery time, quality consistency, and service responsiveness [2][3] - The long-tail strategy is central to the company's competitive approach, aiming to build industry entry barriers through core competencies [3] Group 2: Global Expansion - The company is committed to globalization, leveraging China's supply chain advantages to serve overseas markets, starting with Japan and Southeast Asia [4][5] - Currently, the company covers over 30 countries and regions globally, including Asia, North America, Europe, South America, and Oceania [6] Group 3: Supplier Management - A comprehensive supplier management process is in place, including qualification assessments and performance evaluations based on delivery punctuality and quality [7] - The company aims to reduce dependency on single suppliers to ensure supply chain stability and flexibility [7] Group 4: Employee Incentives - A stock incentive plan for 2025 includes granting 6.32 million restricted shares to 90 core employees, linking their interests to the company's long-term development [8][9] - Key performance indicators for the incentive plan include gross margin, reflecting the company's service capabilities [9] Group 5: Organizational Development - The company emphasizes organizational strengthening as a key driver for strategic implementation, focusing on employee growth and talent acquisition [10][11] - The "Leap Talent Project" aims to recruit experts in various fields to fill gaps in business expansion and innovation [10] Group 6: Customer Engagement - The company enhances customer loyalty by providing a standardized product catalog and design tools to facilitate purchasing decisions [12] - In 2024, approximately 74% of customers had more than two sales records, contributing over 99% of sales, with high-frequency customers accounting for 95% of sales [12] Group 7: Product Development and Platform Value - The company has developed a comprehensive product system with 196 categories and over 2.3 million SKUs, offering a one-stop procurement platform [13] - Future strategies include expanding the platform's transaction scale and enhancing brand influence through digitalization and smart trading services [13]

Financial Performance - The company achieved a revenue of 2.504 billion CNY in 2024, a decrease of 13.08% compared to 2.881 billion CNY in 2023 [2] - The net profit attributable to shareholders was 404 million CNY, down 25.87% from 546 million CNY in 2023 [2] - The net profit after deducting non-recurring gains and losses was 398 million CNY, a decline of 26.25% from 540 million CNY in 2023 [2] - Total assets at the end of 2024 were 4.670 billion CNY, with net assets of 4.111 billion CNY and total liabilities of 558 million CNY, resulting in a debt-to-asset ratio of 11.96% [2] - The net cash flow from operating activities was 729 million CNY, an increase of 93.56% compared to 376 million CNY in 2023 [2] Strategic Focus - The company emphasizes a customer-centric approach, aiming to provide "extreme product power" to meet the needs of both large and small clients [3][4] - The strategic vision includes creating a great organization and achieving significant business success, focusing on flexibility in organizational structure and talent acquisition [4] - Key strategic directions include long-tail demand, global market expansion, and deepening automation capabilities [4][5] Business Development - The company is enhancing its capabilities in non-standard parts and automation, with a focus on improving efficiency and reducing downtime in production [6][9] - An automatic quoting system is set to launch in May 2024, significantly reducing quoting time from hours to seconds [6][7] - The company is investing in flexible intelligent production lines, with an expected annual output value of several million CNY and a significant increase in production efficiency [9] Market Outlook - The company anticipates growth in the automotive and semiconductor sectors due to technological advancements and government incentives [10] - The lithium battery sector is expected to recover, driven by increased demand and overseas market growth [10] - The photovoltaic industry is projected to experience a decline in demand, with limited expansion expected in the near future [10] Supplier Management - The company has a rigorous supplier development process, ensuring quality and reliability through comprehensive evaluations [8] - A performance evaluation system is in place to monitor supplier delivery and quality metrics [8] Financial Strategy - The company plans to raise 870 million CNY through a targeted stock issuance to support the construction of new manufacturing centers [11] - The focus remains on maintaining a healthy cash flow, with a net cash ratio of 1.8 times in 2024 compared to 0.69 times in 2023 [9]

Investment Rating - The report maintains an "Outperform" rating for the company with a target price of RMB 27.90, up from the current price of RMB 22.00 [2][18]. Core Insights - The company reported a revenue of RMB 2.504 billion for 2024, a decrease of 13.08% year-on-year, with a net profit of RMB 404 million, down 25.87% year-on-year. However, in 1Q25, revenue rebounded to RMB 620 million, an increase of 14.8% year-on-year, and net profit rose to RMB 121.8 million, up 26.5% year-on-year [3][12]. - The gross margin improved significantly in 1Q25 to 38.1%, up 3.1 percentage points year-on-year, driven by the recovery in the lithium battery segment's margin to 31.2% [4][13]. - The company has expanded its product line to cover 196 major categories and 4,437 subcategories, increasing its SKU count to over 2.3 million, which enhances its competitive position [5][15]. - The strategic focus on the FB business and global expansion includes the implementation of a smart quoting system and flexible production lines to cater to long-tail orders, leveraging China's supply chain advantages for overseas growth [6][17]. Financial Summary - Revenue projections for 2025, 2026, and 2027 are RMB 2.908 billion, RMB 3.358 billion, and RMB 3.852 billion, respectively, with net profits expected to be RMB 517 million, RMB 632 million, and RMB 769 million [2][18]. - The company’s gross profit margin is projected to improve from 37.5% in 2025 to 39.5% by 2027 [8][10]. - The report indicates a modest increase in earnings estimates for 2025 and 2026, with a P/E ratio of 28x applied to the 2026 earnings [18].