Core Viewpoint - Meili Technology (stock code: 300611) announced a significant asset acquisition plan to acquire 100% equity of Dutch company Hitched Holdings 3 B.V. (HH3) through its wholly-owned subsidiary Meili Holding GmbH, marking a strategic move to enhance international presence and competitiveness in the automotive parts industry [1][5] Group 1: Acquisition Details - The acquisition will utilize a "locked box mechanism" for pricing, with a base price of €63.6929 million, subject to adjustments based on the closing date [2] - The funding for the acquisition will come from the company's own funds and self-raised capital [2] - ACPS Group, the target company, is a leading player in high-end automotive trailer hitch systems with nearly 70 years of history and over 200 patents [2][3] Group 2: Strategic Synergies - The acquisition will allow Meili Technology to gain access to ACPS's established channels, core technologies, and the internationally recognized "ORIS" brand, creating multiple synergies [3] - The global automotive industry is transitioning towards smart and electric vehicles, and the acquisition will help Meili Technology enhance its product offerings and move up the value chain [3][4] Group 3: Operational Integration - The integration of production and supply chains is expected to lower costs and improve profit margins, leveraging China's supply chain advantages [4] - Post-acquisition, Meili Technology will inherit ACPS's long-term relationships with major international clients like Volkswagen, Mercedes-Benz, and BMW, significantly shortening the market expansion timeline [4][5] Group 4: Market Positioning - The acquisition is part of Meili Technology's ongoing strategy to expand its international footprint through mergers and acquisitions, aiming to build a global business structure that combines mature markets in Europe and emerging markets in China [5][6] - The growing demand for trailer hitches in China, driven by the rise of self-driving tourism and relaxed trailer policies, positions ACPS's technology and brand advantages to capture market opportunities [6]

Core Insights - The company, Meili Technology, is actively engaging with humanoid robot manufacturers to address technical challenges and enhance communication within the industry [2] - Meili Technology has developed a high-strength, high-precision damping spring that improves the flexibility and coordination of robots, positioning it as a critical component in robotic linear actuators [3] - The company has transitioned from traditional spring manufacturing to focus on high-tech applications, including air suspension springs for electric vehicles and robot springs, recognizing the need for innovation in a competitive market [4][6] Group 1: Company Development - Meili Technology was founded 35 years ago, initially starting as a small spring workshop and gradually expanding into various spring applications, including motorcycle and automotive springs [4] - The company has identified opportunities in the rapidly growing domestic electric vehicle market, prompting a strategic shift towards developing air suspension springs, which were previously dominated by foreign companies [4] - The company has successfully launched small-batch robot springs within three months of forming a dedicated robotics team, showcasing its agility in entering new markets [3][6] Group 2: Technical Innovations - The company has invested significant resources into developing air suspension springs, overcoming challenges related to the durability and sealing of rubber air bags in extreme conditions [5] - The first prototype of the passenger car air spring assembly is set to be completed in 2024, having passed customer validation tests [6] - The added value of robot springs is anticipated to be higher than that of automotive springs, with the potential to become a billion-dollar market segment [6]

Investment in Robotics - Company has invested in Hangzhou Jukun Robotics, acquiring a 3.70% stake through capital increase, completed on October 15, 2025 [1] - Jukun Robotics focuses on the design and control of robotic hands/arms, multimodal perception, and intelligent operations [1] - Strategic cooperation will focus on dexterous hands and industrial robotic arms, leveraging the company's advantages in smart manufacturing [1] Financial Performance - In the first half of 2025, company reported total revenue of 937 million, a year-on-year increase of 32.62% [2] - Profit before tax reached 143 million, up 58.81%, while net profit attributable to shareholders was 127 million, increasing by 56.18% [2] - Company is expanding into non-automotive sectors, including humanoid robots and aerospace, through acquisitions [2] Production Capacity Expansion - Domestic production capacity expansion includes a 250 million investment in Chongqing, aiming for an annual output of 5 million stabilizers and 3 million springs [3] - Internationally, the company has established production bases in Germany, Mexico, and Morocco to serve North African and European markets [3] - Continuous investment in new technologies and automation has improved production efficiency and product quality [3] Technological Advancements - Company holds 23 national invention patents and 186 utility model patents, with a strong focus on R&D [4] - Recognized as a provincial enterprise technology center and research institute, enhancing its competitive edge in the automotive spring sector [4] - Strong technical foundation and manufacturing capabilities have enabled entry into the supply chains of leading domestic and international automotive brands [4]

Core Insights - The company conducted a targeted research activity with nine institutions, discussing business development and strategies [1] - The company attributes its strong gross profit margin to independent material research and development, enhancing material performance for automotive springs [1][2] - Future strategies include focusing on core business, upgrading existing products, and expanding into overseas markets and specialized spring products [1][2] Group 1: Business Development - The company is enhancing its material production capacity in Nanjing to optimize manufacturing costs [2] - There is a focus on lightweight and intelligent product upgrades to meet customer demands [1][2] - The company is currently receiving small batch orders in the humanoid robot business, led by the sales director [2] Group 2: Market and Performance - The company has experienced high growth due to the rapid rise of self-branded vehicles, but anticipates a slowdown in growth rates in the coming years [2] - The growth slowdown is attributed to the release of production capacity and changes in the end market conditions [2] - The automotive parts industry is facing cost pressures, prompting the company to control costs more effectively [2]

Group 1: Company Performance and Strategy - The company's core technology is self-developed materials, enhancing the performance of automotive springs through years of technical accumulation and heat treatment processes, resulting in a unique competitive advantage [2] - The company will continue to focus on its main business, upgrading existing products in terms of materials, technology, and processes to achieve further lightweighting and intelligence [2] - The company plans to expand into overseas markets and optimize product structure, particularly in valve and special-shaped spring businesses [2] Group 2: Robotics Business Development - The humanoid robot business is currently led by the sales director, with no plans to establish a dedicated team at this time; however, future integration of valve and special-shaped spring products into a separate division is being considered [3] - The company is continuously sending samples and has received small batch orders in the humanoid robot sector, but the current volume does not significantly impact overall performance [2] Group 3: Growth Projections and Market Conditions - The company has maintained a high growth rate due to the rapid rise of self-branded vehicles, but growth is expected to slow down in the coming years, influenced by production capacity release and market conditions [3] - The company anticipates a slowdown in growth rates due to a higher performance base in 2024 and significant capacity release in the latter half of 2024 [3] - The automotive parts industry faces annual downward pressure, which is a common market behavior; the company aims to control costs and expand material production capacity to optimize manufacturing costs [3]

Summary of Meili Technology Conference Call Company Overview - Meili Technology is positioned as a leading player in the automotive spring industry and is expanding into the humanoid robot sector, leveraging its existing product capabilities and market advantages [2][4]. Key Financial Projections - Revenue is expected to grow steadily, with projections of approximately 2.1 billion RMB in 2025, 2.6 billion RMB in 2026, and 3.2 billion RMB in 2027, reflecting an average annual growth rate of around 25% [2][3]. - Net profit is anticipated to increase at a faster rate than revenue, with estimates of nearly 200 million RMB, 250 million RMB, and 300 million RMB for the next three years [2][3]. Humanoid Robot Sector Insights - Meili Technology has a significant advantage in the humanoid robot market due to its expertise in automotive springs, which can be adapted for use in humanoid robots [4][5]. - The average selling price (ASP) for humanoid robot components is around 100 RMB, with potential revenue reaching billion-level if production scales to one million units [2][5]. - The company has engaged with multiple humanoid robot assembly companies and has entered the sample supply phase, indicating strong development potential in this area [4][5]. Automotive Spring Business Opportunities - The automotive spring business is expected to benefit from mergers and acquisitions, enhancing profitability and market share [6][7]. - The value of individual automotive springs ranges from 300 to 600 RMB, with potential for growth due to increasing complexity in vehicle chassis designs [6]. - The domestic market for automotive springs is approximately 15 billion RMB, with Meili Technology's market share currently around 10%, indicating substantial room for growth [6][7]. - Recent acquisitions, including Jiangsu Boyun and Jiangsu Dayuan, have improved production capacity utilization from 40% at the end of 2024 to higher levels [6][7]. Competitive Landscape - The acquisition of German company Alen has improved the competitive landscape for Meili Technology, providing advantages over domestic competitors [6][7]. - The company’s strong cost control capabilities and first-mover advantages in both business segments position it well for future growth [7]. Risks and Considerations - Potential risks include lower-than-expected production and sales of passenger vehicles and rising raw material costs, which could negatively impact company performance [4][8]. Overall Assessment - Meili Technology is expected to continue its growth trajectory in both the humanoid robot and automotive spring sectors, making it a recommended investment opportunity [7].