Investment Rating - The investment rating for the company is "Buy" and is maintained [7] Core Views - The company reported a significant decline in revenue and net profit for H1 2025, with revenue at 4.715 billion yuan, down 30.07% year-on-year, and net profit at 713 million yuan, down 46.46% year-on-year [2][5] - Despite the pressure on the fundamentals, there is a notable recovery in inventory and contract liabilities, with a year-on-year growth of 28% in Q2, indicating potential recovery in downstream demand [2][10] - The company is focusing on IDC construction and the promotion of AI and robotics strategies, which are expected to drive future growth [10] Summary by Sections Financial Performance - For H1 2025, the company achieved revenue of 4.715 billion yuan, a decrease of 30.07% year-on-year, and a net profit of 713 million yuan, down 46.46% year-on-year [2][5] - In Q2 alone, revenue was 2.177 billion yuan, down 35.05% year-on-year, and net profit was 268 million yuan, down 63.86% year-on-year [2][5] - The gross margin for Q2 was 35.2%, showing a slight recovery from the previous quarter [10] Business Segments - The software development segment generated 3.018 billion yuan in H1 2025, down 40.67% year-on-year, while the service outsourcing segment, including IDC and operations, saw a revenue increase of 4.22% [10] - The average price of rebar in Q2 2025 was 3,153 yuan per ton, reflecting a decline of 13% year-on-year [10] Cash Flow and Future Outlook - Operating cash flow for H1 2025 was 1.646 billion yuan, an increase of 3.41% year-on-year, indicating improved collection of receivables [10] - The company is expected to achieve net profits of 1.91 billion yuan, 2.30 billion yuan, and 2.80 billion yuan for 2025, 2026, and 2027 respectively, with corresponding PE ratios of 38.8x, 32.2x, and 26.5x [10]