Investment Rating - The report maintains a "Buy" rating for the company with a target price of 26.26 CNY, based on a PE valuation of 13X for comparable companies in 2026 [3][5]. Core Insights - The company's profitability is under pressure due to declining demand and falling steel prices, with a reported net profit of approximately 450 million CNY for the first three quarters of 2025, a year-on-year decrease of 27.98% [9]. - Despite short-term challenges, the new materials segment is expected to provide a new growth point for profits, with ongoing projects in high-quality stainless steel and titanium materials [9]. - The company has a consistent dividend policy, distributing 3 CNY per 10 shares, which reflects a commitment to returning value to shareholders [9]. Financial Performance Summary - Revenue projections for 2025-2027 are 43,389 million CNY, 46,695 million CNY, and 50,804 million CNY, respectively, with year-on-year growth rates of 3.7%, 7.6%, and 8.8% [4]. - The net profit attributable to the parent company is forecasted to be 664 million CNY, 738 million CNY, and 855 million CNY for 2025-2027, with corresponding year-on-year growth rates of -17.6%, 11.1%, and 15.9% [4]. - The company's gross margin is expected to stabilize around 5.6% to 5.7% over the forecast period, while the net margin is projected to improve slightly from 1.5% in 2025 to 1.7% in 2027 [4].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of 25.87 CNY, based on a PE valuation of 13X for comparable companies [3][5]. Core Views - The company's performance has shown significant improvement on a quarter-on-quarter basis, with a gradual recovery in profitability expected. The net profit attributable to the parent company for the first half of 2025 was 313 million CNY, a year-on-year decrease of 29.14%, but a quarter-on-quarter increase of 92.63% in Q2 2025 [9]. - The company is experiencing a recovery in demand for its cold-rolled stainless steel products, with production and sales volumes increasing by 11.68% and 13.74% respectively in Q2 2025. This has led to an increase in capacity utilization and a rise in gross margin to 5.90% [9]. - The company is expanding its production capacity, with new projects underway that are expected to enhance profit margins as downstream demand gradually recovers. The company’s projects, such as the 1.2 million tons per year high-quality wide stainless steel strip project, are beginning to ramp up production [9]. Financial Summary - The company’s revenue is projected to grow from 39.874 billion CNY in 2023 to 50.900 billion CNY by 2027, with a compound annual growth rate (CAGR) of approximately 8.8% [4]. - The net profit attributable to the parent company is expected to increase from 453 million CNY in 2023 to 948 million CNY in 2027, reflecting a significant recovery in profitability [4]. - The earnings per share (EPS) forecast for 2025-2027 is adjusted to 1.99 CNY, 2.25 CNY, and 2.59 CNY respectively, down from previous estimates [3][4].