Investment Rating - The report assigns an "Accumulate-A" investment rating to the company, with a target price of 229.76 CNY per share [6][16]. Core Views - The company's revenue for the first half of 2025 reached 386 million CNY, a year-on-year increase of 78.24%, while net profit attributable to shareholders was 31 million CNY, up 33.19% year-on-year [1][2]. - The growth in revenue is driven by the increasing demand for liquid cooling products due to the rising computational needs of data centers, alongside the expansion of production capacity from the company's investment projects [2][3]. - The company is focusing on advanced thermal management solutions, with significant revenue growth in its thermal management materials and devices segment, which achieved 342 million CNY in revenue, a 67.77% increase year-on-year [3][11]. Summary by Sections Financial Performance - In H1 2025, the company reported a gross margin of 27.03%, an increase of 1.12 percentage points year-on-year, with stable expense ratios for sales, management, and R&D [2][12]. - The company expects revenues of 977 million CNY, 1.392 billion CNY, and 1.926 billion CNY for 2025, 2026, and 2027 respectively, with year-on-year growth rates of 48.83%, 42.52%, and 38.36% [12][13]. Market Position and Growth Drivers - The demand for liquid cooling solutions is anticipated to rise significantly, particularly in AI data centers, which will enhance the company's order growth [3][16]. - The company is investing in new technologies, including graphene and synthetic graphite thermal interface materials, to strengthen its position in the thermal management market [3][11]. Valuation and Comparables - The report utilizes a price-to-sales (PS) valuation method, assigning a PS of 19 times for 2025, reflecting the expected growth in thermal management demand and the company's strong customer base [8][16]. - Comparables in the thermal management sector include Suzhou Tianmai and Yingweike, which have similar product offerings and market dynamics [16][19].

Group 1 - The liquid cooling technology is gaining traction due to the increasing demand for efficient heat dissipation in high-density computing environments, with significant stock price increases observed in companies like Southern Pump Industry and Yonggui Electric [1] - Liquid cooling, which utilizes liquid as a heat transfer medium, offers higher thermal conductivity and lower energy consumption compared to traditional air cooling methods, and is categorized into direct and indirect liquid cooling types [1] - Major tech companies such as NVIDIA, Microsoft, Google, and Meta are accelerating the adoption of liquid cooling technology, with NVIDIA's GB300 system featuring a fully liquid-cooled design [1] Group 2 - Liquid cooling technology is expanding beyond GPU servers, with companies like Broadcom integrating it into switch devices, and AMD emphasizing liquid cooling in its MI350 series products [2] - The Chinese liquid cooling server market is projected to grow rapidly, reaching a market size of $2.37 billion in 2024, representing a 67% increase from 2023, with a compound annual growth rate of 46.8% expected from 2024 to 2029 [2] - The demand for liquid cooling solutions is driven by the growth of AI computing needs, leading to a transformation in cooling technologies towards modular and intelligent solutions [3] Group 3 - Companies such as Yingweike, Gaolan Co., and Zhongke Shuguang are recognized as key players in the liquid cooling sector, providing various solutions and components for data centers [3][4] - Yingweike is a leading supplier of liquid cooling solutions for major tech companies, while Gaolan Co. specializes in critical components for energy storage liquid cooling [4] - Other notable companies include Feilong Co., which supplies electronic pumps and temperature control valves, and Oulutong, which showcased a new generation of immersion liquid cooling solutions at a major tech conference [4]

Core Insights - Quick Connect Coupling is a key component in modern industry, enhancing production efficiency and ensuring operational safety. CEJN, a Swedish company, is a leader in this niche market and will celebrate its 70th anniversary in 2025 [1] Company Overview - CEJN offers over 8,000 quick connect products, including ultra-high pressure couplings, food-grade spray guns, and quick connectors, catering to various industries such as maritime, construction, aerospace, automotive, chemical, food and beverage, power generation, transportation, and woodworking [1] - The company emphasizes product performance, safety, and environmental sustainability, continuously optimizing production processes and innovating technologies to provide durable, high-quality products that enhance productivity and create value for customers [1] Historical Milestones - CEJN was founded in 1955 by Carl Erik Josef Nyberg in a basement, where the first patent for quick connectors was registered [4] - In the 1960s, CEJN introduced a new generation of pneumatic connectors and expanded its facilities to meet growing demand [6] - The 1970s saw the company relocate to a larger facility and establish its first global sales company in Germany [8] - The 1980s marked significant technological advancements, including the development of high-pressure hydraulic connectors and the introduction of the widely imitated blow gun [10] - In the 1990s, CEJN expanded its facilities and automated assembly operations, launching the WEO plug-in connector, a key product in its portfolio [12] - The 2000s included the establishment of new sales offices globally and the introduction of the iconic 208 blow gun [14] - In 2013, CEJN launched the eSafe series, which became a market leader, followed by the ultraFLOW quick connector in 2018 [16] Recent Developments - In 2021, CEJN completed a new central warehouse, enhancing logistics and supply chain management, and in 2023, a bridge connecting two facilities was completed, becoming a landmark [19] - CEJN is currently led by the third generation of the founding family, with Marcus Allerbjer as CEO, overseeing a team of over 600 professionals and a modern facility of 21,500 square meters [19]