Summary of the Conference Call on China Industrials - 3Q25 Preview Industry Overview - The focus is on the **China Industrials** sector, specifically in **Automation, Robotics, and General Industrials** [1][4] - The overall industry view is **In-Line**, indicating expectations for performance to align with market consensus [4][6] Key Insights - **3Q25 Results Expectations**: Most companies are anticipated to report results that are largely in line with expectations, with a positive outlook for the domestic automation market recovery in **4Q25 and 2026** [1][6] - **Growth Drivers**: The growth is attributed to: - Replacement cycles - New capital expenditures in AI - Solid domestic and overseas demand from multiple downstream sectors such as **NEV (New Energy Vehicles)**, **battery**, and **PCB (Printed Circuit Board)** [1][6] - **Future Demand Outlook**: Continued demand momentum is expected into **4Q25**, with most companies likely to meet their annual targets [6] Company-Specific Highlights 1. **Shenzhen Inovance Technology (300124.SZ)**: - Expected **14% year-on-year revenue growth** in 3Q25, up from **9%** in 2Q25 - NEV powertrain business projected to grow **35% year-on-year** [8] - Estimated net profit growth of **11% year-on-year** to approximately **Rmb1.4 billion** [8] 2. **Zhejiang Shuanghuan Driveline Co. Ltd. (002472.SZ)**: - Anticipated NEV gear sales growth to decelerate to the mid-teens from **30%** in 1H25 due to overall NEV sales growth slowing to **8-12%** [8] - Expected net profit of **Rmb320 million**, a **21% year-on-year increase** [8] 3. **Han's Laser (002008.SZ)**: - Projected **20% year-on-year revenue growth**, primarily driven by a **60%** increase in PCB segment revenue [8] - Estimated net profit growth of **35% year-on-year** to around **Rmb270 million** [8] 4. **Hongfa Technology Co Ltd (600885.SS)**: - Forecasted **13% year-on-year growth** in relay products sales, supported by demand in new energy and NEV sectors [8] - Expected net profit of **Rmb509 million**, a **20% year-on-year increase** [8] 5. **Leader Harmonious Drive Systems (688017.SS)**: - Anticipated **35% year-on-year revenue growth** due to increased humanoid orders [8] - Expected net profit of **Rmb25 million**, a **12% year-on-year increase** [8] 6. **Estun Automation Co Ltd (002747.SZ)**: - Projected **12% year-on-year growth** in industrial robot segment sales [9] - Estimated net profit of approximately **Rmb13 million** in 3Q25 [9] 7. **Centre Testing International Group (300012.SZ)**: - Expected **10% year-on-year revenue growth**, driven by demand recovery and a low base effect [13] Market Sentiment and Catalysts - The sentiment around humanoid theme stocks is expected to improve due to several catalysts in **4Q25**, including: - Tesla's Annual General Meeting (AGM) - Unitree IPO progress - New orders in the humanoid sector [6] Conclusion - The **China Industrials** sector is poised for continued growth, driven by strong demand across various segments, particularly in automation and robotics. Companies are expected to meet or exceed their targets, with a positive outlook for the remainder of 2025 and into 2026 [1][6][8]