Summary of Zhejiang Sanhua Intelligent Controls Conference Call Company Overview - **Company**: Zhejiang Sanhua Intelligent Controls - **Ticker**: 002050.SZ - **Industry**: China Autos & Shared Mobility Key Financial Results - **4Q25 Preliminary Results**: - Expected earnings growth of **25-50% YoY** to **Rmb3.9-4.6 billion** - 4Q25 earnings range projected at **Rmb632-1406 million**, reflecting a **21% decline to 76% increase YoY** - Recurring earnings anticipated to rise **18-48% YoY** to **Rmb3.7-4.6 billion** - Results are largely in line with market expectations of **Rmb4.2-4.4 billion** [1][2] Market Outlook - **2026 Downstream Demand**: - Anticipated slowdown in **US and China EV growth** - European EV demand remains uncertain - Residential AC growth expected to slow, but commercial AC and AI data centers may offset this with strong cooling demand - Potential for humanoid actuator assembly orders presents an additional opportunity for Sanhua [2] Shareholder Information - **H-share Lockup Expiration**: - The lockup period for cornerstone investors is set to expire on **December 22, 2025** [3] Valuation and Financial Metrics - **Current Stock Price**: **Rmb45.42** (as of December 22, 2025) - **Market Capitalization**: **Rmb169,462 million** - **Projected EPS**: - 2025: **Rmb1.11** - 2026: **Rmb1.21** - 2027: **Rmb1.47** - **Revenue Projections**: - 2025: **Rmb33,144 million** - 2026: **Rmb36,807 million** - 2027: **Rmb42,498 million** - **P/E Ratio**: - 2025: **41.0** - 2026: **37.4** - 2027: **31.0** - **ROE**: - 2025: **22.6%** - 2026: **16.3%** - 2027: **17.7%** [5] Risks and Opportunities - **Upside Risks**: - Stronger-than-expected sales from Tesla, particularly in China - Higher growth in air conditioner sales - New EV customer orders - Success in robotic business ventures [10] - **Downside Risks**: - Sales slump in China's property market affecting residential HVAC - Global EV demand slowdown - Increased competition in the NEV sector - Foreign exchange and export risks amid macroeconomic uncertainty [10] Conclusion - The financial results for 4Q25 are in line with expectations, with a positive outlook for 2026 despite anticipated slowdowns in certain markets. The expiration of the H-share lockup may influence stock performance, and various risks and opportunities exist that could impact future growth.

Group 1 - The Dow Jones Industrial Average has surpassed 47,000 following the release of the Consumer Price Index (CPI) inflation report [1] - Oil prices experienced a slight decline after a significant rally due to new U.S. sanctions on Russia's energy sector, with Brent crude down 0.6% to $65.60 per barrel and WTI down 0.5% to $61.46 per barrel [1] - The sanctions are a response to market concerns regarding a supply glut caused by increased OPEC production and decreasing demand [2] Group 2 - Analysts from ANZ noted that the effectiveness of the sanctions will depend on Russia's ability to find alternative buyers for the crude oil previously sent to India [2]