Investment Rating - The report maintains a positive outlook on the PCB upstream new materials, particularly in the fields of electronic cloth and copper foil [2][14]. Core Insights - The report highlights the shift in Nvidia's GB200NVLink design to high-layer, high-frequency low-dielectric PCBs, which is expected to catalyze demand for upstream new materials in AI applications [2][14]. - The report emphasizes the ongoing price increases in the waterproof industry, with major companies like Keshun and Dongfang Yuhong announcing price hikes, reflecting a consensus among industry leaders to combat excessive competition [3][15]. - The report notes the potential for local manufacturing growth in Africa, particularly through companies like Keda Manufacturing, which is integrating into local economies by producing tiles and sanitary ware [4][16]. Summary by Sections 1. Weekly Discussion - The report continues to explore the potential of PCB upstream new materials, focusing on electronic cloth and copper foil, with a significant gap in expectations for high-end copper foil materials [2][14]. 2. Industry Price Changes - The report details the recent price adjustments in the waterproof sector, with companies implementing price increases ranging from 2% to 13% across various product categories [3][15]. - It also provides insights into the cement sector, noting a national average price of 349 RMB/t, a year-on-year decrease of 41 RMB, and an average shipment rate of 43.2% [5][17]. 3. Market Performance - The report indicates that the construction materials index increased by 3.91% this week, with notable performances in glass manufacturing and fiberglass sectors [23][27]. - It highlights the average price of float glass at 1201.02 RMB/ton, with a slight increase of 0.13% compared to the previous week [5][17]. 4. National Subsidy Tracking - The report discusses the government's initiatives to boost consumption, including the organization of new energy vehicle promotions and the issuance of funds for trade-in programs [6][18]. 5. Important Changes - The report notes significant developments, including the central government's emphasis on regulating low-price competition and the announcement of price adjustments by leading waterproof companies [7][22].

Core Viewpoint - Recent price increases by waterproof building material companies signal a collective response to rising costs and intense competition in the industry, marking a "counter-involution" movement [2][5]. Price Adjustments - Companies such as Beijing Oriental Yuhong Waterproof Technology Co., Ltd. and Keshun Waterproof Technology Co., Ltd. announced price hikes for various waterproof products, effective July 1, 2025, with increases ranging from 1% to 13% [3][4]. - Specific products affected include waterproof coatings, tile adhesives, and membrane materials, with the highest increase for waterproof coatings reaching 13% [3][4]. Industry Context - The waterproof industry has faced continuous pressure from fluctuating raw material prices and rising transportation costs, leading to compressed profit margins [5]. - For instance, Oriental Yuhong reported a gross margin of 25.80% in 2024, down 1.89 percentage points year-on-year, and a net margin of only 0.27%, a decline of 6.70 percentage points compared to the previous year [5]. Long-term Implications - Industry leaders emphasize the need to break the cycle of low-price competition, which can disrupt market order and compromise product quality [5]. - The recent price adjustments are seen as a necessary step to foster a healthier, sustainable development trajectory for the industry, moving towards higher quality and added value [5].

Core Viewpoint - The article emphasizes the importance of proper waterproofing in kitchen and bathroom renovations, highlighting the potential issues that can arise from inadequate waterproofing and introducing the brand "Lao Wan Gu" as a reliable solution provider in the waterproofing industry [1][3][20]. Group 1: Importance of Waterproofing - Many homeowners prioritize visible aspects of renovation over hidden works like waterproofing, which can lead to significant issues post-move-in, such as water seepage and damage to both their property and that of neighbors [3][5]. - The costs associated with repairing waterproofing failures can be several times higher than the initial investment in waterproofing, including the need to remove tiles and compensate neighbors [3][5]. Group 2: Common Issues in Waterproofing - Common problems in waterproofing arise from inadequate base treatment, incorrect material selection, and non-compliant construction practices [5]. - Lao Wan Gu offers a comprehensive solution to these issues, leveraging 20 years of industry experience to provide effective waterproofing solutions [5]. Group 3: Lao Wan Gu's Unique Offerings - Lao Wan Gu is recognized for its professional, environmentally friendly, and hassle-free waterproofing solutions, backed by dual certifications as a high-tech enterprise and a specialized enterprise [5]. - The brand's waterproofing products are designed with specific solutions for different scenarios, ensuring high adhesion for walls and flexibility for floors [7][12]. Group 4: Technical Specifications - The "Wall Rigid and Floor Flexible" concept is a key innovation, where wall waterproofing uses high adhesion materials to prevent tile detachment, while floor waterproofing employs flexible materials to accommodate structural movements [12][18]. - Lao Wan Gu's wall waterproofing products exceed national standards in adhesion strength, ensuring tiles remain securely attached [12][13]. Group 5: Environmental Considerations - All Lao Wan Gu products meet stringent environmental standards, including certifications for low formaldehyde and benzene emissions, contributing to healthier indoor air quality [9][20]. Group 6: Ease of Application - The products are designed for ease of use, featuring a two-component system that simplifies the mixing and application process, thus reducing labor costs by 56% [10][20]. - The drying time is optimized to prevent delays in construction while ensuring adequate working conditions for first-time users [10]. Group 7: Conclusion - The article concludes that selecting a professional waterproofing brand like Lao Wan Gu and adhering to a scientific approach can ensure long-term reliability in kitchen and bathroom waterproofing, ultimately providing peace of mind for homeowners [20].

Group 1: Financial Performance - The company achieved a net profit of 44.071 million yuan in 2024, a 113.05% increase compared to the previous year [6] - Operating cash flow increased by 64.52% year-on-year in 2024 [2] - The company has implemented measures to optimize its financial structure, including improved accounts receivable management and cost reduction strategies, resulting in a 0.9 percentage point increase in gross margin [2] Group 2: Business Strategy - The company is focusing on diversifying its channels, with the real estate procurement ratio currently below 15% [1] - Future growth will be driven by expanding non-real estate business, particularly in large infrastructure projects and overseas markets, especially in Southeast Asia [7] - The company plans to enhance its product offerings and reduce costs to improve profitability [7] Group 3: Market Conditions - The decline in crude oil prices positively impacts the company's profitability by reducing the cost of key raw materials like asphalt [4] - The waterproofing industry is expected to see significant demand due to government policies promoting housing renovations and infrastructure projects, with a projected increase in waterproofing needs [9] - The company is well-positioned to capitalize on the growing demand in the maintenance market for older buildings [9] Group 4: Risk Management - The company has established systems to prevent the misuse of funds by major shareholders, including strict approval processes for related transactions [8] - Independent directors regularly review compliance with these systems to ensure shareholder interests are protected [8] - The company maintains a strong liquidity position with approximately 3.4 billion yuan in cash as of the end of 2024, indicating no funding pressure [9]

Core Viewpoint - The company reported a turnaround in profitability for 2024, with a significant increase in cash dividends, indicating potential long-term investment value [1] Group 1: Financial Performance - In 2024, the company achieved operating revenue of 6.829 billion yuan, a year-on-year decrease of 14.04%, while net profit attributable to shareholders was 44 million yuan, marking a return to profitability [1] - The company's non-recurring net profit was -253 million yuan, with a year-on-year loss reduction of 40.93% [1] - For Q1 2025, the company reported revenue and net profit attributable to shareholders of 1.395 billion yuan and 41 million yuan, respectively, reflecting year-on-year declines of 6.06% and 23.19% [1] Group 2: Margin and Cost Management - The company's gross margin for 2024 was 21.77%, an increase of 0.60 percentage points year-on-year, while the expense ratio was 19.49%, up 2.64 percentage points [3] - In Q1 2025, the gross margin and expense ratio were 24.43% and 18.32%, respectively, showing improvements in profitability and cost control [3] - The company reduced asset and credit impairment losses to 310 million yuan in 2024, a decrease of 513 million yuan year-on-year, contributing to a net profit margin of 0.46%, up 4.78 percentage points [3] Group 3: Market Dynamics and Future Outlook - The company’s revenue from waterproofing materials, coatings, and construction services in 2024 was 3.56 billion, 1.79 billion, and 1.21 billion yuan, respectively, with year-on-year changes of -15.4%, -5.7%, and -17.5% [2] - The gross margins for these segments were 19.2%, 33.7%, and 11.4%, with slight improvements in the materials sales business due to a focus on profit and favorable raw material price trends [2] - The company is expected to enhance its market share in the waterproofing industry, with projected net profits for 2025-2027 of 210 million, 300 million, and 420 million yuan, respectively [4]