Investment Rating - The investment rating for the company is "Outperform the Market" [6][28]. Core Views - The company's revenue is showing stable growth, with a 14.6% increase in H1 2025, reaching 960 million, while net profit decreased by 28.0% to 100 million [1][3]. - The company is experiencing a recovery in its core business, with household shield pumps revenue growing by 5.8% to 360 million, and energy-saving pumps seeing over 20% growth in revenue [1][2]. - New business segments, particularly in liquid cooling, are expanding, with a 105% increase in revenue to 70 million in H1 2025, driven by partnerships with major clients [2][3]. Summary by Sections Financial Performance - In H1 2025, the company achieved a revenue of 960 million, a 14.6% increase year-on-year, while net profit was 100 million, down 28.0% [1]. - Q2 2025 revenue was 580 million, reflecting a 3.5% increase, but net profit fell by 37.9% to 60 million due to high base effects from the previous year [1]. - The gross margin for H1 2025 decreased by 3.5 percentage points to 27.0% [3]. Business Segments - Household shield pumps revenue increased by 5.8% to 360 million, with domestic sales slightly declining but foreign sales recovering post-inventory destocking [1]. - Agricultural pump revenue rebounded with a 17.6% increase to 340 million, while industrial pumps grew over 20% to 180 million [2]. - Liquid cooling pumps revenue surged by 105% to 70 million, benefiting from increased demand in the electric vehicle and energy storage sectors [2]. Profitability and Forecast - The company adjusted its profit forecast, expecting net profits of 260 million, 320 million, and 380 million for 2025, 2026, and 2027 respectively, reflecting a year-on-year growth of 1%, 23%, and 19% [3][4]. - The price-to-earnings ratio (PE) is projected to be 33, 27, and 23 for the years 2025, 2026, and 2027 [4].

Meeting Overview - The company held a conference call for its 2025 semi-annual performance on August 26-27, 2025, to enhance investor understanding of its business [1] - Key participants included the General Manager, Board Secretary, CFO, Product Technology Head, and Securities Affairs Representative [1] Financial Performance - The company reported a revenue of 965 million yuan for the first half of 2025, showing a year-on-year growth [2] - Profitability faced pressure due to a non-recurring gain from a factory sale in the same period last year; however, the net profit after deducting non-recurring items slightly declined due to increased depreciation and interest expenses [2][3] - The company aims to enhance internal organizational capabilities to seize market opportunities as external conditions improve [3] Business Segments - The recovery in the agricultural pump and household shield pump sectors is attributed to improved external conditions and proactive adjustments in sales and service policies [3] - The industrial pump segment is facing challenges due to reduced domestic projects and increased competition, but there are positive developments in overseas sales [5] - The new energy segment, particularly liquid cooling pumps for electric vehicles, is experiencing significant growth due to rising sales in domestic new energy vehicle companies [5] Cash Flow and Profitability - The company reported a substantial increase in net cash flow from operating activities, attributed to improved sales collection and management of accounts receivable [6] - Factors contributing to the decline in net profit after deductions include increased depreciation from the new factory and higher interest expenses from convertible bonds, with specific amounts detailed [6] Future Outlook - The company is optimistic about the second half of 2025, expecting a reduction in depreciation costs and improved performance in overseas markets [12] - The focus will be on maintaining revenue growth quality and promoting high-margin products to enhance overall profitability [12] Strategic Development - The company plans to strengthen its position in the pump industry by focusing on core business areas and expanding into industrial pumps and European heating markets [15] - There is an emphasis on building an overseas supply chain to enhance product value and service quality in response to changing market dynamics [15]

Investment Rating - The investment rating for the company is "Buy" with a 6-month outlook maintained [5]. Core Views - The company reported a revenue of 960 million yuan for H1 2025, a year-on-year increase of 14.6%, while the net profit attributable to the parent company was 100 million yuan, a decrease of 28.0% [1][2]. - The company plans to distribute a cash dividend of 5 yuan per 10 shares, with a payout ratio of 81.7% [1]. - The liquid cooling pump market is expected to grow significantly, driven by the expansion of computing power and the need for efficient cooling solutions in data centers [3]. Summary by Sections Financial Performance - In Q2 2025, the company achieved a revenue of 580 million yuan, a year-on-year increase of 3.5%, with a net profit of 60 million yuan, down 37.9% [1][2]. - The gross margin for Q2 2025 was 27.0%, a decrease of 1.2 percentage points year-on-year, attributed to a lower proportion of high-margin household shield pumps [2]. - The company’s net profit margin for Q2 2025 was 10.5%, down 7 percentage points year-on-year, primarily due to the absence of significant asset disposal gains compared to the previous year [2]. Business Segments - The agricultural pump segment generated approximately 340 million yuan in revenue, up 17.6% year-on-year [2]. - The household shield pump segment achieved revenue of about 360 million yuan, a growth of 5.8% year-on-year, while energy-saving pumps saw sales close to 150 million yuan, increasing over 20% [2]. - The industrial pump segment reported revenue of approximately 180 million yuan, with a growth of over 20% [2]. - The liquid cooling temperature control products generated about 70 million yuan in revenue, marking a significant growth of 105% year-on-year [2]. Market Outlook - The liquid cooling pump is positioned as a key component in the rapidly growing AI computing infrastructure, with potential for substantial market share capture due to superior technology [3]. - The company is collaborating with downstream customers to innovate and iterate on shielded liquid cooling solutions, enhancing its competitive edge [3]. Financial Projections - The projected net profit for the company is adjusted to 210 million yuan, 250 million yuan, and 300 million yuan for the years 2025, 2026, and 2027 respectively, with corresponding dynamic P/E ratios of 39.1x, 32.4x, and 27.3x [3].

Core Viewpoint - The company, Dayuan Pump Industry, reported a mixed financial performance for the first half of 2025, with revenue growth but a significant decline in net profit, attributed to the absence of prior asset disposal gains and increased depreciation costs [1][2]. Financial Performance - The company achieved revenue of 9.65 billion yuan, a year-on-year increase of 14.55% [1] - The net profit attributable to shareholders was 1.01 billion yuan, a decrease of 27.99% year-on-year [1] - The non-recurring net profit was 930.09 million yuan, down 10.67% year-on-year [1] - The increase in depreciation expenses was 32.88 million yuan, nearly a 10 million yuan increase compared to the previous year [1] Business Segments - The liquid cooling temperature control business grew by 105% year-on-year, with revenue of 0.7 billion yuan in the first half of 2025 [2] - The sales revenue from products used in the new energy vehicle sector reached approximately 0.33 billion yuan, a year-on-year increase of 58.6% [2] - The traditional civil series products remain the main revenue source, with the agricultural pump segment recovering to achieve revenue of about 3.4 billion yuan, a year-on-year increase of 17.6% [4] - The household shield pump segment generated revenue of 3.6 billion yuan, a year-on-year increase of 5.8% [4] Market Dynamics - The company has made breakthroughs in liquid cooling projects for mining machines, marking a new application scenario [3] - The household shield pump segment showed a mixed performance, with domestic sales slightly declining due to external market pressures, while exports recovered after a prolonged adjustment period [4] - The total accounts receivable amounted to 4.79 billion yuan, indicating potential risks related to customer payment capabilities [4]

Report Summary 1. Report Industry Investment Rating No information provided. 2. Core Viewpoints of the Report - The company is confident in achieving stable revenue growth and boosting profit levels in a stable downstream market environment [27]. - The pump industry is expected to have a stable development trend, and the company, with a comprehensive product line, will benefit from it [28]. - The European heat pump industry has shown signs of recovery, and the company will increase its investment in Europe to seize the opportunity [33]. 3. Summary by Relevant Catalogs 3.1. Research Basic Situation - Research object: Dayuan Pump Industry [17]. - Industry: General equipment [17]. - Reception time: May 15, 2025 [17]. - Reception personnel: Company General Manager Wang Lvjun, Company Board Secretary Huang Linxiang, Company Financial Controller Ye Chenchen, and Company Independent Director Lan Caiyou [17]. 3.2. Detailed Research Institutions - Reception object: All investors [20]. - Reception object type: Others [20]. 3.3. Research Institution Proportion No information provided. 3.4. Main Content Information - **Future Capital Expenditure Plans**: - The capital expenditure of the Wenling new factory is nearing completion, with only small - scale long - term expenditures remaining [24]. - The Hefei new factory still needs about 100 million yuan in subsequent expenditures and will be transferred to fixed assets in late 2025 or 2026 depending on the relocation [24]. - The Thai production capacity construction plan is currently planned to cost 30 million US dollars, with funds sourced from the company's own or self - raised funds. The construction progress depends on government approvals and market conditions [25]. - These capital expenditures have been comprehensively evaluated, and the company's self - owned funds can cover them without affecting normal operations. The company will balance business development and dividend stability [25]. - **Enterprise Governance and Management Structure**: - The company's directors are responsible for major decision - making. In actual operations, the general managers or principals of four business segments (agricultural pumps, household shielded pumps, and Reike commercial pumps) are professional managers, accounting for nearly 80% of the 2024 revenue. The company will continue to strengthen the professional manager system [26]. - **Business Performance and Outlook**: - In 2024, the company achieved an operating income of approximately 1.909 billion yuan, a year - on - year increase of 1.57%, and a net profit attributable to the parent of approximately 255 million yuan, a year - on - year decrease of 10.55%. In the first quarter of 2025, the operating income was about 380 million yuan, a year - on - year increase of 37.21%, and the net profit attributable to the parent was about 39 million yuan, a year - on - year decrease of 3.95% [31]. - In the first quarter of 2025, the company's overall operating income increased rapidly due to the recovery of the agricultural pump business, the significant year - on - year growth of the liquid - cooling temperature control business and the Reike commercial pump business [29]. - The decrease in net profit in the first quarter of 2025 was mainly due to factors such as the increase in the proportion of new and low - gross - margin businesses, and the increase in R & D investment and amortization and depreciation expenses of fundraising projects. However, as the business matures, the profit level is expected to improve [29]. - **Business Development Strategies**: - For civil products, the company will promote product upgrades to increase market share; for commercial products, it will accelerate product technology iteration and expand new business; for industrial products, it will seize the opportunity of domestic substitution and expand product layout [32]. - The company is integrating and promoting all - category liquid - cooling products, with market and product development as strategic priorities in 2025, and the development of key downstream benchmark customers as an urgent task [33]. - The company injected the stainless - steel pump business into the "Reike" brand in 2022 to improve market share and visibility. In 2024, it acquired an additional 20% of the minority shareholder's equity to promote business development, and the business has grown rapidly on a low base in the past two years [33][34].