Core Viewpoint - JinKa Intelligent experienced a 4.27% increase in stock price on October 20, with a trading volume of 393 million yuan, indicating strong market interest and activity [1] Financing Summary - On October 20, JinKa Intelligent had a financing buy-in amount of 50.32 million yuan, with a net financing purchase of 18.12 million yuan after repayments [1] - The total financing and securities balance reached 323 million yuan, accounting for 5.63% of the circulating market value, which is above the 90th percentile of the past year, indicating a high level of financing activity [1] - The company had a securities lending balance of 12.46 million yuan, with a remaining quantity of 9,100 shares, also above the 80th percentile of the past year [1] Company Overview - JinKa Intelligent Group Co., Ltd. was established on July 28, 2004, and listed on August 17, 2012, located in Hangzhou, Zhejiang Province [2] - The company specializes in the research, production, and sales of smart gas meters and gas measurement management systems, providing comprehensive solutions for gas companies [2] - The revenue composition includes 64.49% from smart residential gas terminals and systems, 20.73% from smart commercial gas terminals and systems, 7.70% from smart public utility management systems, and 7.09% from smart water terminal systems [2] Financial Performance - For the period from January to June 2025, JinKa Intelligent reported a revenue of 1.539 billion yuan, representing a year-on-year growth of 3.69%, while the net profit attributable to shareholders decreased by 37.97% to 135 million yuan [2] Shareholder Information - As of June 30, 2025, the number of shareholders decreased by 5.90% to 24,200, with an average of 15,315 circulating shares per person, which increased by 6.32% [2][3] - Since its A-share listing, the company has distributed a total of 1.248 billion yuan in dividends, with 456 million yuan distributed in the last three years [3]

Core Insights - The stock price of Jinka Intelligent increased by 2.13% on October 20, reaching 13.41 CNY per share, with a trading volume of 147 million CNY and a market capitalization of 5.61 billion CNY [1] - The company has seen a year-to-date stock price increase of 1.80%, with a 5-day increase of 3.55%, a 20-day increase of 7.45%, and a 60-day increase of 9.92% [1] - Jinka Intelligent's main business involves the research, production, and sales of smart gas meters and gas measurement management systems, providing comprehensive solutions for gas companies [1] Financial Performance - For the first half of 2025, Jinka Intelligent reported a revenue of 1.539 billion CNY, representing a year-on-year growth of 3.69%, while the net profit attributable to shareholders decreased by 37.97% to 135 million CNY [2] - The company has distributed a total of 1.248 billion CNY in dividends since its A-share listing, with 456 million CNY distributed over the past three years [3] Shareholder Information - As of June 30, 2025, the number of shareholders for Jinka Intelligent was 24,200, a decrease of 5.90% from the previous period, with an average of 15,315 circulating shares per shareholder, an increase of 6.32% [2] - The seventh largest circulating shareholder is Hong Kong Central Clearing Limited, holding 2.9709 million shares, which is a decrease of 3.1045 million shares compared to the previous period [3]

Core Viewpoint - The company reported a revenue increase of 4% year-on-year for 1H25, but a significant decline of 38% in net profit attributable to shareholders, indicating challenges in profitability despite revenue growth [1] Group 1: Financial Performance - 1H25 revenue reached 1.539 billion, a 4% increase year-on-year; net profit attributable to shareholders was 135 million, a 38% decrease year-on-year [1] - In Q2 2025, revenue was 837 million, a 9% year-on-year increase and a 19% quarter-on-quarter increase; net profit was 92 million, a 23% year-on-year decrease but a 110% quarter-on-quarter increase, showing improvement [1] - The company expects to benefit from the increasing penetration of smart gas meters in China and ongoing expansion in the flow meter sector and overseas markets [1] Group 2: Business Segments - In 1H25, revenue from smart residential gas terminals and systems was 992 million, an 11.49% year-on-year increase; sales of residential ultrasonic gas terminals surged by 86.06% year-on-year [2] - Revenue from smart industrial and commercial gas terminals and systems was 319 million, a slight decrease of 0.52% year-on-year; smart water terminals and systems revenue was 109 million, down 5.95% year-on-year; revenue from smart public utility management systems and others was 118 million, down 24.71% year-on-year [2] - Domestic revenue for 1H25 was 1.477 billion, a 2.39% increase year-on-year; international revenue was 61 million, a significant increase of 49.79% year-on-year [2] Group 3: Profitability and Cost Control - The overall gross margin for 1H25 was 35.90%, a decrease of 4.76 percentage points year-on-year; the gross margin for smart residential gas terminals and systems was 31.97%, down 2.94 percentage points year-on-year; for smart industrial and commercial gas terminals and systems, the gross margin was 47.74%, down 7.58 percentage points year-on-year [3] - The company maintained stable cost control, with sales, management, and R&D expense ratios for 1H25 at 15.74%, 4.32%, and 7.39%, respectively, showing minor changes year-on-year [3] Group 4: Market Expansion - The company successfully completed certifications for various flow meters, enhancing product maturity and market adaptability, achieving breakthroughs with nearly 60 clients, including major industry players [4] - Increased investment in overseas resources led to successful international certifications for key products, facilitating market expansion [4] - The company capitalized on opportunities from the Belt and Road Initiative, securing orders in several countries along the route, including Ukraine, Russia, Kazakhstan, and others [4] Group 5: Profit Forecast and Valuation - The company forecasts net profits attributable to shareholders for 2025-2027 to be 333 million, 365 million, and 405 million, respectively, with adjustments of -19% for each year [5] - The average PE for comparable companies in 2025 is expected to be 19x, leading to a target price of 15.13, down from a previous 16.66 [5]

Core Viewpoint - The company reported a decline in revenue and net profit for 2024 and Q1 2025, indicating challenges in maintaining growth amidst market conditions [1][2]. Financial Performance - In 2024, the company achieved revenue of 3.066 billion, a decrease of 3.4%, and a net profit of 360 million, down 11.9% [1]. - For Q1 2025, revenue was 702 million, a decline of 2.3%, with a net profit of 44 million, down 55.8% [1]. - The gross profit margin for 2024 was 39.7%, a decrease of 2.6 percentage points, and the net profit margin was 12%, down 1.3 percentage points [2]. - In Q1 2025, the gross profit margin fell to 35.2%, down 5.8 percentage points, and the net profit margin was 6.2%, down 8.1 percentage points [2]. Business Segmentation - The revenue from smart residential gas terminals and systems accounted for approximately 56.5%, while smart commercial gas terminals and systems contributed about 22.9% in 2024 [2]. - The commercial gas customer demand is gradually recovering, and the company is leveraging policy opportunities in urban safety projects to strengthen market share [2]. Strategic Initiatives - The company is enhancing strategic partnerships, including collaborations with Hangzhou Gas and Shunwu Technology to develop smart gas information and automation systems [2]. - A memorandum of understanding was signed with Huawei HiSilicon to explore applications in digital gas, digital water, and new energy sectors [2]. - The company is focusing on R&D with a spending rate of over 7%, targeting innovations in quality flow meters and digital management systems [2]. Market Position and Future Outlook - The company holds the leading global market share in smart gas meters as of 2023, with plans to expand into digital water, energy, and process sectors [2]. - The government has issued policies to promote digital upgrades and smart management of municipal infrastructure, which is expected to support long-term growth [2]. - The profit forecasts for 2025, 2026, and 2027 are adjusted to 383 million, 436 million, and 504 million respectively, with corresponding EPS of 0.92, 1.04, and 1.20 [3].