Investment Rating - The report maintains a "Recommended" rating for the company, indicating an expected stock price increase of over 15% relative to the benchmark index within the next 12 months [6]. Core Views - The company achieved a revenue of 1.099 billion yuan in H1 2025, a year-on-year decrease of 2.40%, while the net profit attributable to shareholders increased by 0.91% to 93 million yuan [1]. - The company's customer structure has been optimized, with significant growth in orders from high-end functional footwear materials and stabilization in sofa and home furnishing orders. The company has established a tiered customer base, deepening ties with renowned brands such as Nike, Adidas, and Toyota [2]. - The company is expanding its global production capacity, particularly in Vietnam, where it has launched additional production lines. This expansion is expected to improve overall performance as customer orders increase [3]. - Future growth is anticipated due to rising demand for eco-friendly products and the expansion of downstream customers, alongside the release of production capacity from the Vietnam factory [4]. Summary by Sections Financial Performance - In H1 2025, the average selling price of products increased by 7.4%, and the gross margin for ecological functional synthetic leather was 26.68%, up by 0.12 percentage points year-on-year [1]. - The company reported a net profit of 47 million yuan in Q2 2025, a year-on-year decrease of 8.41% [1]. Customer and Product Strategy - The company has focused on high-performance, multifunctional, and eco-friendly products, with R&D investment reaching 78 million yuan in H1 2025, accounting for 7.05% of revenue [2]. - The company is developing customized solutions to meet individual customer needs, enhancing its core competitiveness and pricing power [2]. Global Expansion - The Vietnam facility is expected to reach an annual production capacity of 18 million meters for polyurethane synthetic leather and composite materials, with a positive outlook for performance improvement as orders ramp up [3]. - A wholly-owned subsidiary was established in Singapore to further enhance the company's global development [3]. Earnings Forecast - The company is projected to achieve net profits of 281 million yuan, 364 million yuan, and 472 million yuan for the years 2025, 2026, and 2027, respectively, with corresponding EPS of 1.29 yuan, 1.68 yuan, and 2.17 yuan [4][5].

Summary of Key Points from Conference Call Records Industry Overview - **Nuclear Fusion Projects**: The construction of domestic nuclear fusion projects is accelerating, with experimental reactors rapidly being established, which is expected to benefit related companies in the upstream equipment supply chain [6][8] - **Commercialization Acceleration**: The nuclear fusion sector is entering a period of rapid development, with significant projects like BEST and CRAFT expected to drive growth in the upstream equipment industry [6][8] Core Insights and Arguments - **BEST Project**: The BEST project has commenced two months ahead of schedule, aiming to demonstrate energy generation from nuclear fusion, which will support the development of fusion energy in China [6][8] - **CRAFT Project**: CRAFT is projected to be completed by the end of 2025, becoming a leading international research and testing platform for fusion technology [6][8] - **Investment Opportunities**: Companies such as 合锻智能 (Hezhuan Intelligent) and 联创光电 (Lianchuang Optoelectronics) are positioned to benefit from the rapid development of nuclear fusion technology, with significant involvement in core component manufacturing [6][7] Company-Specific Insights - **安利股份 (Amway Co., Ltd.)**: Recently upgraded to a strategic partner of Nike, with multiple product development projects underway, indicating a positive trend [9] - **Market Position**: Amway is a leader in the PU synthetic leather industry, with strong positions in furniture and emerging automotive sectors [9] - **Financial Outlook**: Expected EPS for 2025-2027 are projected at 1.17, 1.48, and 1.75 CNY, with a target price of 23.4 CNY based on a 20x PE ratio [9] - **Operational Challenges**: Amway Vietnam reported a loss of 17.42 million CNY in 2024, with plans to improve operational efficiency and reduce losses in 2025 [9] Additional Important Content - **Risks**: Potential risks include project development delays, changes in material technology paths, and macroeconomic risks affecting the nuclear fusion sector [8] - **Market Reactions**: Stock performance of related companies shows mixed results, with 安利股份 down 0.46%, while 合锻智能 increased by 5.59% [10]