Investment Rating - The report maintains a "Buy" rating for Tianhong Co., Ltd. [2] Core Views - The company is undergoing a transformation with three major business formats and is leveraging AI to enhance its digital transformation [2][6] - The company reported a slight decline in revenue for the first half of 2025, but is optimistic about future growth driven by business optimization and digital capabilities [6][7] - The company is focusing on upgrading its core business formats and accelerating the integration of AI and retail technology [7] Financial Data and Earnings Forecast - Total revenue for 2025 is estimated at 11,934 million yuan, with a year-on-year growth rate of 1.3% [6] - The net profit attributable to the parent company is projected to be 132 million yuan for 2025, reflecting a significant increase of 72.0% year-on-year [6] - The company’s gross margin is expected to improve slightly to 37.0% in 2025 [6] - The company’s return on equity (ROE) is forecasted to be 3.2% in 2025, increasing to 4.5% by 2027 [6] Business Operations - As of the first half of 2025, the company operates 46 shopping centers, 58 department stores, and 106 supermarkets, with ongoing efforts to optimize and upgrade its store network [7] - The company has seen a significant increase in online sales and digital services, with a gross merchandise volume (GMV) of 27.1 billion yuan for online goods and services [7] - The company’s digital membership has grown to over 53 million, with an 8.5% year-on-year increase [7]