Company Overview - Shenzhen Heertai Intelligent Control Co., Ltd. was established in 2000 and listed on the Shenzhen Stock Exchange in 2010. The main business segments include intelligent control solutions and microwave/mm-wave phased array chips [2][3]. - The company achieved a total revenue of 96.59 billion CNY in the first three quarters of 2025, marking a year-on-year growth of 17.47% [3]. Financial Performance - For the first three quarters of 2025, the net profit attributable to shareholders reached 6.03 billion CNY, a significant increase of 69.66% year-on-year [3]. - The overall gross profit margin improved by 1.91%, indicating enhanced profitability alongside revenue growth [3]. Business Segments - The household appliance intelligent controller segment accounts for approximately 60% of total revenue, while electric tools, industrial automation, automotive electronics, and intelligent products each contribute about 10%-15% [5]. - The automotive electronics segment has seen improvements in gross margin due to prior R&D investments, with a robust order backlog and successful customer expansion [7]. Strategic Initiatives - The company plans to increase R&D investment and customer expansion to maintain stable growth in its core business [4]. - Future investments will focus on robotics, sensors, and other core segments of the industry chain to ensure sustainable growth and long-term market stability [4]. Global Operations - The company has established production bases in over 20 countries, including Vietnam, Italy, Romania, and Mexico, with high capacity utilization rates in Vietnam and Italy [3][6]. - Ongoing efforts to optimize operations include enhancing local supply chain management and cost control [6]. Future Outlook - The intelligent product segment is expected to maintain high growth rates, driven by advancements in AI technology and expanding applications in smart home and healthcare products [7]. - The company is committed to continuous market exploration and product diversification to support stable growth and cultivate new revenue streams [7]. Supply Chain Management - The company has developed a comprehensive supplier management system to mitigate the impact of rising upstream component prices, ensuring stable raw material costs [7]. - A collaborative supply chain model has been established to enhance operational efficiency and flexibility [7]. R&D and Innovation - New project development cycles typically range from 3 to 12 months, depending on customer requirements and project complexity [8]. - The company’s subsidiary, Chengchang Technology, has achieved significant revenue growth in the phased array radar and satellite communication sectors, with a revenue of 306 million CNY in the first three quarters of 2025 [9].

Core Insights - The report from Tianfeng Securities highlights that Heertai achieved operating revenue of 5.446 billion yuan in H1 2025, representing a year-on-year growth of 19.21% [1] - The company reported a net profit attributable to shareholders of 354 million yuan, marking a significant year-on-year increase of 78.65% [1] Business Segments Performance - Revenue from home appliance smart controllers reached 3.56 billion yuan, with a year-on-year growth of 22.14% [1] - Revenue from electric tool smart controllers was 535 million yuan, reflecting a year-on-year increase of 8.32% [1] - Smart product controllers generated revenue of 618 million yuan, showing a year-on-year growth of 9.92% [1] - Automotive electronic smart controllers achieved revenue of 415 million yuan, with a year-on-year increase of 5.20% [1] - Revenue from phased array T/R chips surged to 201 million yuan, representing a remarkable year-on-year growth of 180.16% [1] Strategic Initiatives - The company is proactively developing gesture interaction technology and has launched the "Perception Plan" gesture clothing, which is widely compatible with VR/AR scenarios and extends to wellness cushion products [1] - Heertai has integrated the DeepSeek large model into its industry digital intelligence model, facilitating applications in smart office, health home, and smart control, thereby creating a collaborative path from "information processing" to "device control" [1] - The company maintains an "overweight" rating, indicating a positive outlook on its growth potential [1]

Core Viewpoint - The company, Heertai, has demonstrated strong performance in the first half of 2025, with revenue reaching 5.446 billion yuan, a year-on-year increase of 19.21%, and net profit growing significantly by 78.65% to 354 million yuan, reflecting successful expansion into high-value sectors such as automotive electronics and smart products [1][8][10]. Group 1: Financial Performance - In the first half of 2025, Heertai achieved a revenue of 54.46 billion yuan, marking a 19.21% increase compared to the previous year [9]. - The net profit for the same period was 3.54 billion yuan, representing a substantial growth of 78.65% year-on-year [13]. - The overall gross margin improved by 1.66 percentage points to 19.13%, driven by increased margins in key product lines [13]. Group 2: Business Segments - The smart control electronics segment accounted for 96.31% of total revenue, with a year-on-year growth of 16.64% [9]. - The household appliance smart controller business saw a revenue increase of 22.14%, while the automotive electronics segment grew by 5.2% [10][11]. - The microwave millimeter-wave T/R chip business experienced a remarkable growth of 180.16%, contributing to the overall revenue increase [11]. Group 3: Technological and Market Position - Heertai has established itself as a leading player in the smart controller industry, with over 20 years of experience and a strong patent portfolio [3][5]. - The company has developed a comprehensive vertical technology matrix covering various fields, enhancing its customized R&D capabilities [5]. - Heertai's global manufacturing and service network spans multiple countries, allowing for rapid response to customer needs and strengthening its competitive edge [6]. Group 4: Industry Outlook - The global smart controller market is projected to grow steadily, with an expected market size of approximately 19.77 billion USD in 2024, reflecting a growth rate of about 4.4% [17]. - The Chinese market for smart controllers is anticipated to reach 38.73 billion yuan in 2024, with a year-on-year growth of 12.10% [17]. - The demand for smart home appliances and electric tools is expected to drive further growth in the smart controller sector, supported by advancements in IoT and AI technologies [19][20].

Group 1 - The company is currently constructing a new production base in Shenzhen, which is expected to produce various intelligent control products [2] - The planned product range includes smart controllers for home appliances, power tools, automotive electronics, and other intelligent product controllers [2]