Core Viewpoint - The company plans to issue convertible bonds to raise up to 1.2 billion yuan for investment in a new energy intelligent manufacturing flexible electric connection system project and to supplement working capital [1] Group 1: Investment and Project Details - The total investment for the new energy intelligent manufacturing flexible electric connection system project is 1.184 billion yuan, with 900 million yuan expected to be funded from the raised capital [1] - A new production base will be established in Liyang City, Changzhou, Jiangsu Province, with an annual production capacity of approximately 45 million new flexible electric connection components upon completion [1] Group 2: Market Demand and Client Relationships - The company's flexible printed circuit (FPC) products primarily serve the rapidly growing electric vehicle and energy storage industries, with clear order demand driven by the expansion of end customers' production capacity [2] - Major automotive manufacturers such as XPeng Motors, Dongfeng Nissan, and Geely have begun using the company's FPC products in large quantities, while energy storage clients are also expressing increased demand due to industry growth [2] Group 3: Competitive Position and Future Opportunities - The company emphasizes the need to expand FPC manufacturing capacity to meet the increasing order demands from clients, particularly in light of competitive pressures from international customers [2] - Emerging fields such as low-altitude economy and innovative medical applications are driving the demand for lightweight, high-reliability, and customized FPC solutions, which the company is actively developing [2] - The company aims to maintain and strengthen its leading position in the FPC sector through capacity expansion, especially as leading battery manufacturers like CATL push for higher integration of next-generation battery systems [2]

Summary of the Conference Call for Xidian New Energy Company Overview - **Company**: Xidian New Energy - **Industry**: Electric Vehicle (EV) Components and Energy Storage Solutions Key Points and Arguments Financial Performance - In Q2 2025, Xidian New Energy reported total revenue of approximately 400 million yuan, benefiting from the ramp-up of the Volkswagen MEB platform and light truck projects, alongside increased demand from Tesla and Sunshine Energy [2][3] - Revenue for the first half of 2025 was about 390 million yuan, with battery connection systems (CCS) contributing around 110 million yuan and electric control and industrial bus revenues exceeding 20 million yuan [3] Market Demand and Outlook - The company expects Q3 2025 performance to surpass Q2, with stable orders from the Volkswagen MEB platform and strong demand for energy storage [4] - The overall market demand for the second half of 2025 is optimistic, with an anticipated industry growth rate of around 30% [4][20] - Sunshine Energy's demand remains strong, contributing positively to the overall market outlook [5] Client Relationships and Orders - Despite a slight decrease in demand from established clients like BYD, increased orders from clients such as Westinghouse and Mitsubishi have compensated for the shortfall [2][3] - The company is supplying to new clients including Hongqi, Great Wall, and Changan, with potential for increased volume in 2026 [8][9] - Xidian New Energy has established partnerships with Jianghuai and Geely, expecting mass production within 8 to 9 months [9] Product Development and Margins - The new product gross margin is expected to be at least 15%, with overall margins close to the average level [16] - The FCC technology offers a cost reduction of about 10% compared to traditional solutions, with potential gross margins of 15% to 20% if discounts are provided to manufacturers [17] Strategic Expansion - Plans to establish a factory in Thailand are underway, with trial production expected by the end of 2025 or early 2026, aimed at addressing potential tariff issues and supporting local automotive and battery manufacturers [27] - The company is also exploring international client relationships, including with major automakers like Mercedes-Benz, Ford, and General Motors, as well as companies in the energy storage sector like Samsung [28] Competitive Landscape - Xidian New Energy maintains a competitive edge through in-house equipment development and continuous upgrades, enhancing production efficiency and cost control [18][19] - The company is cautious about competitors relying on external suppliers, which may hinder their ability to keep pace with technological advancements [18] Future Projections - The energy storage business is projected to reach 1 billion yuan in 2025, with optimistic estimates for 2026 reaching around 1.5 billion yuan [24] - The company anticipates a steady increase in revenue from new clients, with production capabilities ready to meet sudden increases in orders [22] Market Trends - The Southeast Asian electric vehicle market is expected to grow rapidly, prompting Xidian New Energy to focus on this region for future expansion [33] Challenges - Tesla's demand has been affected by model cycle changes, but the company expects to align its growth with the overall industry growth rate of 30% [20][32] Additional Important Information - The company is not exclusively supplying Xiaomi, which uses a different supplier for its products [11] - The impact of Tesla's declining gross margins on Xidian New Energy's overall performance is being monitored, as it could affect sales of electric control products [32]