Investment Rating - The report maintains an "Outperform" rating for the company [1] Core Views - The company's performance in the first half of 2025 is in line with expectations, with total revenue reaching 4.248 billion yuan, a year-on-year increase of 18.58%, and a net profit attributable to shareholders of 484 million yuan, up 16.36% year-on-year [7] - The report highlights the ongoing bottoming out of the electrolyte business and the strengthening trend of liquid cooling technology, indicating a positive long-term growth outlook for the fluorochemical sector [7] - The company is expanding its global layout in the electrolyte business and has made strategic acquisitions to enhance its supply chain stability [7] Financial Data and Profit Forecast - The company is projected to achieve total revenue of 10.009 billion yuan in 2025, with a year-on-year growth rate of 27.6% [5] - The net profit attributable to shareholders is expected to reach 1.178 billion yuan in 2025, reflecting a year-on-year increase of 25.0% [5] - The report forecasts earnings per share of 1.57 yuan for 2025, with a projected PE ratio of 30 [5] Market Data - As of September 12, 2025, the company's closing price is 47.30 yuan, with a market capitalization of 25.554 billion yuan [1] - The company has a price-to-book ratio of 3.7 and a dividend yield of 0.85% [1]

Summary of the Conference Call for Haohua Technology Company Overview - **Company**: Haohua Technology - **Industry**: Fluorochemical and Electronic Chemical Industry Key Points and Arguments Industry Performance - The fluorochemical sector of Sinochem Blue Sky is experiencing a dual situation, with refrigerant product prices remaining high, significantly contributing to profit growth. However, competition in PTFE, fluorinated rubber, and PVDF products is intensifying, leading to losses in lithium battery materials, which negatively impacts overall profit levels [2][5][9] - The company has a complete industrial chain and a rich product structure, enhancing its overall risk resistance and profitability [2] Financial Performance - In Q1 2025, the revenue from basic chemicals was approximately 900 million RMB, and refrigerant revenue was about 600 million RMB. The gross margin for the refrigerant business was close to 95%, accounting for about 47% of Blue Sky's revenue. The average gross margin for the quarter was 43.4%, an increase of 16 percentage points from Q4 of the previous year [2][8] - Lithium battery materials and fluoropolymer businesses negatively impacted overall performance in Q1 2025, with gross margin contributions of -11% and -5.5%, respectively, dragging down profits by nearly 16% [9] Business Segments - The special products segment saw a significant decline in performance in 2024, with Q1 2025 orders still not ideal. However, the expected increase in defense budgets is anticipated to improve this segment in the future [2][13] - The fluorochemical segment's performance is mixed, with refrigerant prices maintaining high levels, while PTFE and fluorinated rubber face increased competition, affecting profitability [5][9] Strategic Focus - Haohua Technology is focusing on its 3+1 core businesses: high-end fluorinated materials, electronic chemicals, high-end manufacturing chemicals, and carbon reduction. The aerospace application in high-end manufacturing is expected to be a significant source of future profits [2][6][30] - The company aims to enhance its core competitiveness through research institutions and optimize product structure and technological innovation for steady growth [7][30] Future Outlook - The integration of Sinochem Blue Sky has significantly strengthened Haohua Technology's capabilities, with 4.5 billion RMB in raised funds expected to accelerate project construction and improve lithium battery business margins [4][29] - The company is optimistic about the future, with expectations of stable profitability despite market competition, and plans to enhance the quality of development across all business segments [30][31] Additional Insights - The special products business, although only accounting for 8%-10% of revenue, contributes significantly to gross profit (16%-20%) and is crucial for the company [14] - The defense budget increase to about 7% of GDP is seen as a positive signal for the special products segment, indicating potential future demand [17] - The electronic chemicals business showed strong growth in Q1 2025, with revenues reaching 226 million RMB, a 23% increase year-on-year [27][28] Competitive Landscape - The competition in the specialty chemicals sector has intensified, but Haohua Technology's long-term technical accumulation and operational model provide a competitive edge [24][25] This summary encapsulates the key insights from the conference call, highlighting the company's performance, strategic focus, and future outlook within the fluorochemical and electronic chemical industry.