Group 1: Company Performance - In the first half of 2025, the company achieved operating revenue of 238,183.32 million yuan, a significant increase of 52.26% compared to the same period last year [4] - The net profit attributable to shareholders reached 26,327.17 million yuan, reflecting an impressive growth of 83.82% year-on-year [4] Group 2: PCB Industry Trends - The PCB industry is expected to grow by 7.6% in revenue and 7.8% in production in 2025, driven by strong demand for AI servers and switches [6] - From 2024 to 2029, the compound annual growth rate (CAGR) for capacity in the PCB sector is projected to be 22.1% for high multilayer boards and 17.7% for HDI boards [6] - The global PCB market is anticipated to reach nearly 100 billion USD by 2029, while the domestic market is expected to hit 50 billion USD [7] Group 3: High Multilayer Board Market - The demand for high multilayer boards is increasing due to the rapid growth of data and the adoption of 112/224Gbps SerDes designs in AI servers and high-speed switches [8] - The need for advanced drilling technology, such as CCD six-axis independent drilling machines, is rising to meet the higher precision and quality requirements for AI PCB products [9] - The company has developed a CO2 laser drilling machine that meets the high-quality processing needs for large-diameter and cross-layer blind holes [10] Group 4: HDI Market Situation - The demand for HDI boards is rapidly increasing in AI smartphones, AI PCs, automotive electronics, and optical modules [11] - The company is upgrading its CO2 laser drilling machines and high-resolution imaging systems to meet the shrinking feature sizes of HDI products [11] - New laser processing solutions have been developed to achieve high precision in micro-hole drilling and shaping, gaining recognition and orders from downstream customers [12]

Core Viewpoint - Dazhu CNC has achieved significant growth in 2024 after two consecutive years of declining revenue and profit, with a revenue increase of 104.56% and a net profit increase of 122.20% compared to the previous year [2][3] Financial Performance - In 2024, Dazhu CNC reported a revenue of 3.343 billion yuan and a net profit of 301 million yuan [2] - For Q1 2025, the company continued its growth trend with revenues of 960 million yuan and a net profit of 117 million yuan, representing year-on-year increases of 27.89% and 83.60% respectively [2] - Despite the growth, the company's performance has not yet returned to pre-spin-off levels, as the net profit for Q1 2025 is still 66 million yuan lower than the same period in 2022 [5] Market Dynamics - The growth in Dazhu CNC's performance is primarily driven by a recovery in downstream demand, particularly in the electronics sector, which is closely linked to the PCB manufacturing industry [3][4] - The global electronic terminal market is expected to grow at a rate of 4.9% in 2024, with AI infrastructure demands significantly contributing to this growth [3] - The PCB industry is projected to maintain a compound annual growth rate of 5.2% from 2024 to 2029, with expectations for better performance in 2025 compared to 2024 [3] Margin and Cash Flow Concerns - The company's gross profit margin has dropped below 30% for the first time since 2020, falling to 28.11% in 2024, with significant declines in Q1 and Q3 [8][9] - The decline in gross margin is attributed to increased competition in mature product categories, particularly drilling equipment [9] - Despite revenue growth, the net cash flow from operating activities decreased by 262 million yuan year-on-year to 155 million yuan in 2024, and further declined to -335 million yuan in Q1 2025 [9] Strategic Initiatives - Dazhu CNC is planning to list on the Hong Kong Stock Exchange to raise funds for overseas expansion, with a focus on enhancing its international presence [2][11] - The company has reported an increase in overseas revenue from 5.35% in 2023 to 10.83% in 2024, indicating a strategic shift towards international markets [11] - Ongoing projects related to PCB specialized equipment production and technology development are progressing, with significant investments already made [12]