Core Viewpoint - Diao Micro (688381) has announced the termination of its plan to acquire 100% equity of Rongpai Semiconductor (Shanghai) Co., Ltd. through a combination of issuing shares and cash payment, along with raising supporting funds [1] Group 1: Transaction Details - The proposed transaction was not expected to constitute a major asset restructuring, related party transaction, or lead to a change in the actual controller of the company [1] - Diao Micro had engaged in multiple discussions and negotiations regarding the feasibility, core terms of the transaction, and pricing with the counterparties but ultimately could not reach an agreement on key terms such as the transaction plan, price, and performance commitments [1] Group 2: Company Operations - The company stated that its production and operational status remains normal, and the termination of this transaction will not have a significant adverse impact on its operational and financial conditions [1] - There are no concerns regarding the protection of the interests of the company and minority shareholders due to the termination of this transaction [1]

Investment Rating - The investment rating for the company is "Outperform the Market" (maintained) [3][14]. Core Views - The company is planning to acquire a stake in Rongpai Semiconductor, which is expected to enhance its product line and market expansion [5][14]. - Rongpai Semiconductor specializes in analog chip design, focusing on high-barrier markets such as new energy and automotive electronics, which aligns with the company's strategic goals [6][10]. - The acquisition, if successful, will complement the company's product offerings and accelerate its market penetration [5][14]. Summary by Sections Acquisition Details - The company is in the process of planning to acquire Rongpai Semiconductor through a combination of issuing shares and cash payments [5][10]. - Rongpai Semiconductor's products include digital isolators, drivers, interfaces, and sampling components, which are crucial for applications in electric vehicles and industrial control [6][10]. Financial Projections - The projected net profits for the company from 2025 to 2027 are estimated at 64 million, 90 million, and 128 million respectively, with corresponding P/E ratios of 109x, 77x, and 54x based on the stock price as of October 9, 2025 [5][14]. - The company's revenue is expected to grow significantly, with a forecasted increase in shipments by 40% year-on-year in the first quarter of 2025 [10]. Market Positioning - Rongpai Semiconductor aims to become a leading provider of high-performance analog integrated circuits, focusing on key clients and expanding its supply chain capabilities [10]. - The company is committed to enhancing its core competencies and transitioning from product advantages to cost advantages in the semiconductor market [10].