Core Viewpoint - Wencan Co., Ltd. is a leading domestic supplier of automotive aluminum alloy precision die-casting parts, with a focus on integrated die-casting technology and a strong market position in the automotive parts industry [1] Group 1: Business Performance - In Q3 2025, Wencan's revenue reached 4.338 billion yuan, ranking 6th in the industry, while the industry leader, Zhongding Co., Ltd., reported revenue of 14.555 billion yuan [2] - The net profit for the same period was 2.3574 million yuan, placing the company 45th in the industry, with the top performer achieving a net profit of 1.305 billion yuan [2] Group 2: Financial Ratios - As of Q3 2025, Wencan's debt-to-asset ratio was 52.44%, higher than the industry average of 40.56% [3] - The gross profit margin for the same period was 12.63%, which is below the industry average of 21.56% [3] Group 3: Shareholder Information - As of September 30, 2025, the number of A-share shareholders decreased by 7.14% to 33,700, while the average number of circulating A-shares held per shareholder increased by 7.69% to 9,331.94 [5] - The top ten circulating shareholders include Hong Kong Central Clearing Limited, which increased its holdings by 1.793 million shares [5] Group 4: Business Highlights - In the first half of 2025, Wencan secured multiple projects in the integrated die-casting sector, with a total project value exceeding 5 billion yuan expected to be mass-produced between 2025 and 2026 [5] - The company has also received customer approvals for magnesium alloy products, indicating potential for new growth areas [6]

Investment Rating - The report maintains a "Strong Buy" rating for the company with a target price of 25.8 CNY [2][8]. Core Views - The company's revenue for the first half of 2025 was 2.8 billion CNY, a year-on-year decrease of 9%, with a net profit attributable to shareholders of 0.13 billion CNY, down 84% year-on-year [2][8]. - The company's performance is under pressure due to external factors, particularly in overseas markets, but there are expectations for marginal improvements in the future [2][8]. - The domestic market shows signs of recovery, with the company's main operations achieving a net profit of 0.80 billion CNY, reflecting a 10% year-on-year increase [2][8]. Financial Summary - Total revenue projections for 2024A, 2025E, 2026E, and 2027E are 6,247 million CNY, 6,275 million CNY, 7,038 million CNY, and 7,467 million CNY respectively, with growth rates of 22.5%, 0.4%, 12.2%, and 6.1% [4][9]. - Net profit attributable to shareholders is projected to be 115 million CNY in 2024A, 87 million CNY in 2025E, 231 million CNY in 2026E, and 256 million CNY in 2027E, with corresponding growth rates of 128.2%, -24.6%, 166.9%, and 10.8% [4][9]. - The company's earnings per share (EPS) is expected to be 0.37 CNY in 2024A, 0.28 CNY in 2025E, 0.74 CNY in 2026E, and 0.82 CNY in 2027E [4][9]. Market Performance - The company's stock price has shown fluctuations, with a 12-month high of 29.61 CNY and a low of 20.01 CNY [5][9]. - The company is positioned as a benchmark in the integrated die-casting industry, with expectations for performance recovery in the latter half of the year and into the next [2][8].