Core Viewpoint - The National Energy Administration and four other departments have issued guidelines to promote high-quality development of energy equipment, focusing on enhancing efficiency and stability in long-distance, high-power electricity transmission [1] Group 1: Key Equipment Development - Accelerate the development of high-reliability, large-capacity, low-loss DC converter transformers and key equipment such as high-parameter power device-based converter valves and ultra-high voltage DC control protection systems [1] - Focus on advancing the development of intelligent switches, solid-state circuit breakers, and high-capacity intelligent charging systems to facilitate diversified access and digital upgrades of new distribution systems [1] Group 2: Environmental and Technological Innovations - Promote the replacement and application of environmentally friendly green equipment, including natural ester insulated transformers, eco-friendly gas high-voltage switches, and energy-saving transformers [1] - Develop AI-based automated control systems and new generation distribution IoT operating systems to enhance the smart regulation system of the power grid [1]

Summary of the Conference Call for Liangxin Co., Ltd. Company Overview - **Company**: Liangxin Co., Ltd. - **Industry**: New Energy, Smart Building, Digital Energy, Infrastructure Key Financial Metrics - **Revenue**: 2.341 billion CNY in H1 2025, a year-on-year increase of 25.47% [2] - **Net Profit Margin**: 10.68%, a decrease of 1.1 percentage points year-on-year [2] - **R&D Investment**: 154 million CNY, approximately 6.58% of revenue [3] - **Gross Margin**: 31.59%, a decrease of 0.66 percentage points year-on-year [3] Business Segment Performance - **New Energy**: Accounts for nearly 50% of revenue, with a year-on-year growth of 39.1% [2][5] - **Smart Building**: Revenue declined by 22% year-on-year, accounting for 13.4% of total revenue [5] - **Infrastructure**: Revenue increased by 14.2% year-on-year, accounting for 14.7% of total revenue [5] - **Digital Energy**: Revenue grew by 18.9% year-on-year, accounting for 19.7% of total revenue [5] Strategic Developments - **Project Wins**: Secured multiple projects with major clients such as Sunlight Wind Power, Huawei, and BYD, with project values ranging from 5 million to over 20 million CNY [2][5] - **Nuclear Power**: Entered the nuclear power sector with a full range of certified products, enhancing import substitution efforts [6] - **Zero Carbon Certification**: The Hangzhou Bay Super Factory received zero carbon certification, generating 20 million kWh of green power annually [2][6] Market Dynamics - **Overseas Market**: Slight decline in gross margin due to regional structure and price competition; annual target set at 180 million CNY [7] - **Data Center Focus**: Targeting internet companies, operators, and government enterprises; aiming for high and low voltage brand penetration [8][9] Future Outlook - **Positive Outlook**: Anticipates continued high demand in the new energy sector, with overall performance growth expected [4][24] - **Smart Building Sector**: Expects a reduction in revenue decline to within 20% for the year [4][27] - **Growth Projections**: Forecasts a 15% organic growth rate over the next three years [4][27] Challenges and Opportunities - **Smart Building Sector**: Facing challenges due to real estate market impacts, but preparing for future growth through project initiatives [27] - **Data Center Market**: Significant opportunities exist in the overseas data center market, driven by technological upgrades and demand for low-voltage components [29] Product Development - **New Product Innovations**: Focus on HVDC low-voltage components and integrated power solutions; transitioning from mechanical to electronic circuit breakers [12][36] - **Solid-State Circuit Breakers**: Engaging in R&D for solid-state technology, with expectations for prototypes by late 2025 to 2026 [44] Conclusion - **Overall Strategy**: Liangxin Co., Ltd. is positioned to leverage growth in the new energy and digital energy sectors while addressing challenges in the smart building market. The company is actively pursuing import substitution and technological advancements to enhance its competitive edge in both domestic and international markets.

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company's performance aligns with market expectations, with rapid development in AIDC (Automatic Identification and Data Capture) [2][9] - The digital energy sector is poised for growth, with significant collaboration with major domestic companies and progress in overseas markets [9] - The renewable energy sector shows steady growth, with expectations of a 20-30% year-on-year increase in overall downstream performance [9] - The company has increased its profit forecasts for 2025-2027, reflecting a strong outlook for net profit growth [9] Financial Summary - Total revenue is projected to reach 4,994 million yuan in 2025, with a year-on-year growth of 17.84% [1] - Net profit attributable to shareholders is expected to be 509.42 million yuan in 2025, representing a year-on-year increase of 63.22% [1] - The latest diluted EPS is forecasted at 0.45 yuan per share for 2025, with a P/E ratio of 24.96 [1] - The company anticipates a target price of 16.4 yuan per share for 2026, based on a P/E of 30x [9]

Group 1: Product Applications and Advantages - The company's Automatic Transfer Switch Equipment (ATSE) products are primarily used in high-safety and stability-demanding fields such as rail transit, data centers, hospitals, and venues [2] - Solid-state circuit breakers are widely applicable in DC distribution scenarios, including photovoltaic storage, data communication, power grids, and marine applications [2] - Solid-state circuit breakers can cut off fault currents in hundreds of microseconds without generating arcs, significantly reducing the risk of damage to power sources and loads, thus enhancing distribution safety and reliability [2] Group 2: Development and Market Strategy - The company's solid-state transformer is currently in the application scheme verification and market research phase, with the phase-shifting transformer in the prototype development stage [3] - Solid-state transformers offer efficient power conversion and control, with potential applications in renewable energy integration, grid disturbance response, data centers, electric vehicle charging, electrified shipping, and aerospace [3] - The company is actively seeking opportunities for external development, focusing on vertical expansion in related industries such as mechanical and electrical, industrial automation control, and power instruments [3] Group 3: International Expansion - The company is expanding its overseas business, particularly in Southeast Asia and Russia, focusing on smart distribution products, transformers, and charging stations [3] - A subsidiary has been established in Singapore, achieving a small number of overseas project implementations [3]

Group 1: Company Overview and Market Position - The company operates in the medium and low voltage electrical appliance industry, positioning itself as a high-end brand with a focus on technological innovation and brand strategy [4] - It has significant advantages in energy efficiency management technology, solid-state circuit breakers, and smart 1U circuit breakers compared to domestic peers [3][4] - The company aims to leverage its leading power electronics technology to accelerate product iteration and expand applications in smart grids, data communications, and new energy sectors [3] Group 2: Product Applications and Innovations - The company's power and distribution products are applied in four main areas within the new energy sector: wind power, photovoltaic systems, energy storage, and industrial distribution [2] - Solid-state circuit breakers offer advantages over traditional breakers, including microsecond-level response times and arc-free operation, enhancing safety and reliability [5] - The smart 1U circuit breaker integrates load protection, communication self-identification, and metering functions, catering to the specific needs of communication base stations [6][7] Group 3: Strategic Focus and Future Plans - In 2025, the company will focus on strategic sectors such as smart grids, data communications, intelligent industries, new energy, and rail transportation, while also exploring overseas markets [8] - The company is committed to continuous innovation and product development in digitalization and intelligence to support stable growth [8] - To address challenges such as declining profits and market competition, the company is optimizing its strategic layout and enhancing its product offerings in key sectors [9] Group 4: Financial Performance and Challenges - The company faced revenue declines in 2024 due to macroeconomic factors and increased competition, leading to adjustments in its strategic focus [9] - It aims to mitigate the impact of economic fluctuations by optimizing its performance structure and enhancing its capabilities in smart distribution solutions [9] - Future strategies include developing strategic customer relationships, accelerating product line development, and improving operational efficiency [9]