Investment Rating - The report assigns a "Buy-A" investment rating to the company with a target price of 7.46 CNY for the next six months [5][10][18]. Core Insights - The company reported a total revenue of 2.481 billion CNY for H1 2025, a year-on-year decrease of 28.35%, and a net profit of 324 million CNY, down 45.88% year-on-year. However, overseas revenue increased significantly by 61.73% to 693 million CNY [1]. - The smart meter segment achieved revenue of 1.427 billion CNY in H1 2025, reflecting a growth of 24.15% year-on-year, with substantial domestic and international market wins [2]. - The company is expanding its operations in the renewable energy sector, particularly in smart operation and maintenance services, with a signed operational capacity exceeding 20 GW and a 40% year-on-year growth in operational capacity [3]. - The energy storage segment has delivered over 5 GWh and has a project reserve of 10 GWh, with significant progress in both domestic and international markets [9]. Financial Projections - Revenue projections for 2025, 2026, and 2027 are 7.345 billion CNY, 8.115 billion CNY, and 8.971 billion CNY, respectively, with growth rates of 8.94%, 10.48%, and 10.55% [10][13][18]. - Net profit estimates for the same years are 768 million CNY, 861 million CNY, and 959 million CNY, with growth rates of 2.1%, 12.1%, and 11.3% [10][13][18]. - The gross margin is expected to improve from 28.19% in 2025 to 30.02% in 2027 [15]. Business Segments - The smart energy meter and system products are projected to generate revenues of 3.245 billion CNY, 3.894 billion CNY, and 4.478 billion CNY from 2025 to 2027, with a gross margin of around 35% [13][14]. - The energy storage and energy-saving business is expected to achieve revenues of 1.057 billion CNY, 1.216 billion CNY, and 1.337 billion CNY, maintaining a gross margin of 17% [14]. - The photovoltaic power generation segment is projected to generate revenues of 925 million CNY, 972 million CNY, and 1.020 billion CNY, with a gross margin of approximately 62% [14].

Group 1: Smart Distribution Business - The smart distribution business is a strategic investment area for the company, focusing on industrial and commercial building sectors [2] - The company is enhancing its smart distribution products in terms of materials, manufacturing, processes, and electrical performance to remain competitive [2] - Future breakthroughs will involve personalized smart distribution solutions tailored to different customer electricity usage scenarios [2] Group 2: Data Center Business - The data center business focuses on power distribution, smart monitoring, and intelligent operations, including integrated smart distribution systems and low-voltage solutions [3] - The company maintains a competitive edge in operator procurement tenders and collaborates closely with major domestic clients to develop customized products [3] - The company is actively working on import substitution and enhancing its core technology system in overseas markets [3] Group 3: Financial Performance - The improvement in gross margin for Q1 2025 is attributed to product structure optimization, cautious price control, and better cost reduction effects compared to the previous year [3] - The fastest-growing sectors in Q1 2025 include renewable energy, electricity, and data center industries, with a focus on creating value through technological innovation and scenario-based solutions [3]