Group 1 - The core point of the article is that Aux Electric (2580.HK) is launching an IPO from August 25 to August 28, aiming to raise up to HKD 3.609 billion with a maximum share price of HKD 17.42 [1] - The company plans to issue a total of 207,161,200 shares, with 10,358,200 shares available for public offering in Hong Kong and 196,803,000 shares for international placement [1] - Aux Electric, established in 1994, specializes in the design, research and development, production, sales, and service of high-quality home and central air conditioning systems [1] Group 2 - The revenue projections for Aux Electric from 2022 to 2024 are HKD 19.528 billion, HKD 24.832 billion, and HKD 29.759 billion respectively [1] - The gross profit for the same period is expected to be HKD 4.150 billion, HKD 5.422 billion, and HKD 6.240 billion, with gross margins of 21.3%, 21.8%, and 21.0% [1] - The net profit forecasts are HKD 1.442 billion, HKD 2.487 billion, and HKD 2.910 billion, with net profit margins of 7.4%, 10.0%, and 9.8% [1] Group 3 - The company intends to allocate approximately 20% of the net proceeds from the IPO for global research and development [2] - About 50% of the funds will be used to upgrade smart manufacturing systems and supply chain management [2] - Approximately 20% will be directed towards strengthening sales and distribution channels, and 10% will be used for working capital and general corporate purposes [2]

Core Viewpoint - The company, AUX Electric (02580), is set to launch an initial public offering (IPO) from August 25 to August 28, 2025, aiming to raise approximately HKD 3.287 billion through the global sale of 207 million shares, with a price range of HKD 16.00 to 17.42 per share [1][3]. Group 1: Company Overview - AUX Electric is one of the top five air conditioning providers globally, involved in the design, research and development, production, sales, and service of both residential and central air conditioning systems [1]. - The company has a significant global presence, covering over 150 countries and regions, and holds a market share of 7.1% in the global air conditioning market, which is projected to reach RMB 1.3128 trillion by 2024 [1]. Group 2: Financial Performance - The company has demonstrated strong revenue growth, with revenue increasing from RMB 19.528 billion in 2022 to RMB 24.832 billion in 2023 (up 27.2%), and further to RMB 29.759 billion in 2024 (up 19.8%) [2]. - Net profit also saw substantial growth, rising from RMB 1.442 billion in 2022 to RMB 2.487 billion in 2023 (up 72.5%), and to RMB 2.91 billion in 2024 (up 17.0%) [2]. - The net profit margin for the years 2022, 2023, and 2024 was recorded at 7.4%, 10.0%, and 9.8% respectively, with a margin of 9.9% for the three months ending March 31, 2025 [2]. Group 3: Use of Proceeds - The company plans to allocate approximately 20% of the net proceeds from the IPO for global research and development, 50% for upgrading smart manufacturing systems and supply chain management, 20% for enhancing sales and distribution channels, and 10% for working capital and general corporate purposes [3].

Core Viewpoint - The company reported a significant decline in revenue and net profit for the first half of 2025, indicating challenges in its core business operations while also showing a substantial increase in order contracts, particularly in international markets. Group 1: Financial Performance - The company achieved an operating income of 549 million yuan, a year-on-year decrease of 22.53% [1] - The net profit attributable to shareholders was -7.64 million yuan, compared to a profit of 8.90 million yuan in the same period last year [1] - The net profit after deducting non-recurring gains and losses was -11.51 million yuan, compared to -3.62 million yuan in the previous year [1] - Basic earnings per share were -0.02 yuan [1] Group 2: Revenue Breakdown - The main business revenue was 547 million yuan, down 22.59% year-on-year [2] - Revenue from power station cooling products was 67.24 million yuan, a decrease of 65.55% [2] - Revenue from petrochemical products was 401 million yuan, down 9.61% [2] - Other business income was 2.29 million yuan, a decline of 1.61% [2] Group 3: Order Contracts and Market Expansion - The total order contract amount reached 1.385 billion yuan, an increase of 213.31% year-on-year [2] - The order amount for power station cooling products was 176 million yuan, up 99.16% [2] - The order amount for petrochemical cooling products was 301 million yuan, down 14.89% [2] - The overseas order amount was 908 million yuan, a significant increase of 489.97% [2] - The company attributed the growth in overseas orders to the Belt and Road Initiative and successful international project implementations [2] Group 4: Investment and Project Updates - The company previously announced plans to invest in a new production project for new energy materials with an annual output of 1.2 million sets [3] - The project aimed to establish a large-scale aluminum profile production base focused on market demand [3] - However, the company decided to terminate the investment plan for this project to optimize resource allocation and improve operational efficiency [4]

Core Viewpoint - Longjin Technology (300594.SZ) emphasizes its core technologies in variable frequency drives and intelligent control, highlighting its patented IGBT module drive circuits and energy-saving air conditioning products [2] Group 1: Technology and Innovation - The company possesses core technologies in variable frequency drive and intelligent control [2] - Longjin Technology has obtained patents related to IGBT module drive circuits [2] - All products are developed using variable frequency control technology, which has been widely recognized for its energy-saving effects by industry clients [2] Group 2: Production and R&D - The company owns IGBT module production and testing equipment, with some modules being produced for internal use [2] - Longjin Technology plans to continue investing in research and development to enhance its technology and product quality [2]

Core Viewpoint - Longjin Technology (300594.SZ) has established itself in the variable frequency drive and intelligent control sectors, holding patents related to IGBT module drive circuits, and is recognized for its energy-saving air conditioning products that utilize variable frequency control technology [1] Group 1 - The company possesses core technology in variable frequency drives and intelligent control [1] - Longjin Technology has obtained relevant patents for IGBT module drive circuits [1] - All products developed by the company are energy-saving air conditioning units that apply variable frequency control technology [1] Group 2 - The technology level and energy-saving effects of the company's products have been widely recognized by industry clients [1] - The company owns production and testing equipment for IGBT modules, with some modules being produced for internal use [1] - Longjin Technology will continue to invest in research and development to enhance its technology and product quality [1]

Core Viewpoint - The integration of the Yangtze River Delta region is crucial for establishing a unified national market, enhancing efficiency, and promoting economic development through streamlined processes and improved connectivity [1][2][3]. Group 1: Administrative Efficiency - The "cross-regional handling" initiative allows businesses to complete migration procedures between provinces in less than a day, significantly reducing bureaucratic delays [2]. - The implementation of a unified online service platform has enabled 203 high-frequency administrative services to be processed across provinces, enhancing convenience for residents and businesses [4]. - The optimization of administrative processes aims to break down local protectionism and market fragmentation, thereby improving market operational efficiency [3]. Group 2: Transportation Connectivity - The launch of the high-speed rail loop connecting major cities in the Yangtze River Delta has improved travel convenience, facilitating business operations across the region [6]. - The new rail service has seen significant usage, with over 116.7 million passengers in its first year and an average occupancy rate of 80.5% [6]. - The integration of transportation infrastructure is essential for enhancing the flow of resources and promoting a unified national market [5]. Group 3: Logistics and Trade - The "joint unloading" model has transformed logistics for companies in Anhui, allowing them to ship products directly from local ports to international destinations, reducing transit time by 50% and logistics costs by 30% [8]. - The model has achieved full coverage of first-class waterway ports in Anhui, with a significant increase in the number of transactions processed [8]. Group 4: Financial Integration - The establishment of a financial support platform has facilitated timely loans for technology companies, with over 2,600 registered enterprises and a total credit issuance exceeding 7 billion yuan [10]. - The collaboration between different regions in financial services exemplifies the seamless flow of financial resources across the Yangtze River Delta [10]. Group 5: Innovation and Talent Development - The creation of innovation centers in Shanghai has supported local enterprises in talent acquisition and project development, fostering a collaborative environment for technological advancement [12]. - The G60 Innovation Corridor has connected multiple cities, enhancing the flow of innovative resources and contributing to regional economic growth [12]. Group 6: Consumer Services - The introduction of a cross-regional return policy for retail products has improved consumer convenience, allowing customers to return items purchased in one city at stores in another [13][14]. - The initiative aims to enhance customer satisfaction and promote regional retail integration [14]. Group 7: Regulatory Collaboration - The establishment of a collaborative regulatory framework among different regions aims to enhance the efficiency of market supervision and protect intellectual property rights [16][18]. - The joint inspections and shared regulatory information among regions are designed to streamline enforcement and improve compliance [17][18]. Group 8: Food Safety and Traceability - The implementation of a digital traceability system for food products has improved safety standards and operational transparency for local food producers [20]. - The initiative aims to create a comprehensive data tracking system from production to consumption, enhancing food safety management [20].

Core Viewpoint - The article discusses the integration and optimization of the Yangtze River Delta region's market, highlighting the benefits of streamlined administrative processes, improved transportation connectivity, and enhanced financial support for businesses, all contributing to the establishment of a unified national market. Group 1: Administrative Efficiency - The "cross-regional handling" service allows businesses to complete migration procedures in less than a day, significantly reducing the bureaucratic burden [6][8] - The implementation of a unified online platform has enabled 203 high-frequency administrative services to be processed across provinces, enhancing efficiency [10] - The integration of data sharing between different regions has streamlined the process for businesses, allowing for quicker approvals and reduced travel [9][10] Group 2: Transportation Connectivity - The launch of the G8388 high-speed train has improved connectivity between major cities in the Yangtze River Delta, facilitating easier travel for business purposes [11][12] - The "super ring line" has seen over 116.7 million passengers in its first year, with an average occupancy rate of 80.5%, indicating strong demand for improved transportation links [11][12] - The "river-sea intermodal" model has allowed Anhui province to efficiently export goods, reducing logistics costs by 30% and transit time by 50% [14] Group 3: Financial Support and Resource Sharing - The establishment of the "E Enterprise Loan" service platform has provided over 70 billion yuan in loans to small and medium-sized enterprises, facilitating access to necessary funding [16] - The collaboration between different regions has enabled financial institutions to offer tailored products to businesses, enhancing the flow of financial resources [16] - The integration of innovation and technology resources across regions has led to successful product development and commercialization [17][18] Group 4: Consumer Market Integration - The introduction of a cross-regional return policy allows consumers to return products purchased in one region at stores in another, enhancing customer convenience [19][20] - The establishment of a unified return mechanism has seen participation from 141 businesses, promoting consumer confidence and satisfaction [20] Group 5: Regulatory Collaboration - The joint inspections by market supervision departments from different regions aim to enhance the protection of intellectual property rights and improve regulatory efficiency [22][23] - The implementation of a comprehensive regulatory framework allows for streamlined inspections across multiple jurisdictions, reducing redundancy [24][25] - The development of a digital traceability system for food safety has improved compliance and safety standards in the region [26]

Core Viewpoint - The company, AUX Electric Co., Ltd., is preparing for an IPO and has submitted its prospectus, aiming to leverage its position as a leading provider of high-quality air conditioning solutions globally [1] Group 1: Company Overview - AUX Electric Co., Ltd. is recognized as a global leader in the design, research and development, production, sales, and service of both household and central air conditioning systems [1] Group 2: Financial Performance - The net profit for the fiscal year 2023 is projected to be 2.487 billion yuan, with a year-on-year increase of 72.49% - For the fiscal year 2024, the net profit is expected to reach 2.910 billion yuan, reflecting a year-on-year growth of 17.03% - In the first quarter of 2025, the net profit is anticipated to be 925 million yuan, showing a year-on-year increase of 23.01% [1]

Financial Data and Key Metrics Changes - Net sales for Q2 2025 declined by $2 million or 0.6% year-over-year to $311.6 million, driven by a 20.9% decline in Aon branded sales, offset by a 90% increase in Basics branded sales [22][23] - Gross margin decreased to 26.6%, down 950 basis points, primarily due to lower production volumes of Aon branded equipment [23][24] - Non-GAAP adjusted EBITDA was 14.9%, down 1120 basis points, and non-GAAP adjusted EPS was $0.22, a decrease of 64.5% from the previous year [23] Business Line Data and Key Metrics Changes - Aon Oklahoma segment net sales declined by 18%, impacted by supply chain disruptions and coil supply shortages due to ERP implementation [25][26] - Aon Coil Products sales grew by $27.1 million or 86.4%, primarily driven by Basics brand products [28] - Basics segment sales increased by 20.4% due to continued demand for data center solutions, with gross margin contracting by 60 basis points [29] Market Data and Key Metrics Changes - Basics branded data center sales surged by 127% in Q2 and 269% year-to-date, indicating strong market demand [19] - National accounts orders for Aon brand grew by 163% year-over-year in Q2, reflecting effective customer engagement [20] - Aon branded Alpha Class heat pump business saw sales growth of 8% in Q2, with bookings increasing by approximately 61% [21] Company Strategy and Development Direction - The company is focused on addressing ERP implementation challenges while maintaining confidence in its long-term strategy [6][7] - The Basics brand is identified as the primary growth engine, with expectations of a 40% year-over-year increase in sales [35] - The company plans to ramp up production at both Tulsa and Longview facilities to meet strong demand, particularly in the data center market [36][37] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges faced in Q2 due to ERP implementation but expressed confidence in recovery and long-term growth [6][42] - The company revised its full-year 2025 outlook to anticipate low teens sales growth and gross margins of 28% to 29% [38] - Management highlighted strong underlying fundamentals and a solid backlog, expecting significant growth in Aon branded sales in the second half of the year [41] Other Important Information - The company incurred $3 million in costs related to the new Memphis facility during the quarter, impacting overall financial performance [23] - Cash flow used in operations year-to-date was $31 million, compared to $127.9 million in the same period last year, reflecting increased investments in working capital [31] Q&A Session Summary Question: Guidance and ERP Implementation Impact - Management indicated that the revised guidance reflects the impact of ERP implementation and lower production volumes, with a focus on recovery in the second half of the year [44][45] Question: Data Center Backlog Health - Management confirmed strong activity in the data center market, with year-over-year sales up 127% in Q2, and emphasized the importance of capacity to meet demand [50][51] Question: Applied Digital Partnership Significance - The partnership with Applied Digital is crucial for Basics, as it involves supplying thermal management solutions for AI data centers, indicating strong future order potential [57][59] Question: Fourth Quarter Growth Expectations - Management expects strong growth in Q4, with a focus on ramping production and leveraging backlog, while still considering ERP impacts [61][62] Question: Aon Brand Booking Strength - The increase in Aon brand bookings is attributed to a successful national account strategy and strong product value proposition, despite a challenging non-residential market [66][68]

Core Viewpoint - The central air conditioning industry is undergoing a transformation from merely meeting basic functional needs to enhancing quality experiences, driven by evolving consumer demands and technological innovations [1]. Trend Summaries Trend 1: Comfort Airflow as Core Competitive Dimension - "Comfort experience" has replaced energy efficiency as the primary focus for brands, with over 35% of online discussions centered on keywords like "comfortable airflow" and "no direct blowing" [2]. - 40.3% of households face issues with uneven heating, while 38.8% report discomfort from direct cold air, highlighting the need for precise control over airflow in various scenarios [2]. - Innovations in airflow technology are emerging, with adjustable designs replacing fixed vents, allowing for better alignment with human comfort [2]. Trend 2: Integration of Home Design Needs - 71.0% of users consider the integration of air conditioning with home decor as a significant factor, with "decorative," "hidden," and "minimalist" designs becoming essential [3]. - Traditional products often fail to meet these aesthetic demands, leading to a rise in innovative designs that blend seamlessly with home interiors [5]. - Simplifying installation processes is becoming crucial, as 41.5% of users have faced issues with complex installation requirements [5]. Trend 3: Technological Innovations Driving Performance Upgrades - Under the "dual carbon" policy, energy-efficient technologies like heat pumps are becoming central to performance upgrades, offering heating efficiency 2-4 times greater than traditional electric heating [7]. - Innovations in airflow patterns are breaking traditional limitations, with leading brands developing multi-mode airflow solutions to address issues like uneven temperature distribution [9]. - 88.9% of users express a clear demand for dual-direction airflow and hidden airflow control technologies, indicating a strong market recognition of these innovations [10]. Conclusion - The central air conditioning industry is evolving towards a focus on user comfort, aesthetic integration, and energy efficiency, driven by technological advancements that address real consumer needs [22].