Core Insights - The company reported a revenue of 13.56 billion yuan in H1 2025, a slight decrease of 0.29% year-on-year, with a net profit attributable to shareholders of 1.93 billion yuan, down 12.8% year-on-year [1] - The gypsum board segment faced pressure with a revenue of 6.68 billion yuan, a decline of 8.57% year-on-year, while the overseas business saw significant growth [2] Revenue and Profitability - In Q2 2025, the company achieved a revenue of 7.31 billion yuan, down 4.46% year-on-year, and a net profit of 1.09 billion yuan, down 21.88% year-on-year [1] - The overall gross margin for H1 2025 was 30.4%, a decrease of 0.6 percentage points year-on-year, with Q2 showing a gross margin of 31.6%, reflecting a sequential improvement [3] Product Performance - Gypsum board revenue accounted for 49.2% of total revenue, while the metal framework and waterproofing businesses contributed 8.4% and 14.2% respectively, with the latter showing growth [2] - The waterproofing segment reported a revenue of 1.92 billion yuan, up 0.37% year-on-year, while the coatings business grew by 40.8% to 2.51 billion yuan [2] Cash Flow and Financial Health - Operating cash flow for H1 2025 was 0.962 billion yuan, a decline of 52.9% year-on-year, primarily due to previous acquisitions affecting cash inflow [3] - As of H1 2025, total receivables and contract assets amounted to 6.92 billion yuan, an increase of 6% year-on-year [3] Strategic Developments - The company is focusing on its core gypsum board business while advancing its "one body, two wings" strategy, including the restructuring of a coatings subsidiary and plans for new production facilities [4] - The overseas business is expanding, with a new gypsum board production line in Thailand entering trial production and ongoing projects in Bosnia [2]

Investment Rating - The report maintains a "Recommended" rating for the company [3]. Core Views - The company's performance is driven by robust growth in its two main business segments, with significant contributions from both waterproofing and coating businesses. The international business is also showing strong growth [6]. - The company reported a revenue of 6.246 billion yuan in Q1 2025, representing a year-on-year increase of 5.09% and a quarter-on-quarter increase of 14.45%. The net profit attributable to the parent company was 842 million yuan, up 2.46% year-on-year and 67.82% quarter-on-quarter [6]. - The company is expanding its coating business, which saw a remarkable revenue increase of 111.44% year-on-year in Q1 2025, reaching 908 million yuan [6]. - The report forecasts steady revenue growth for the company, with projected revenues of 29.51 billion yuan in 2025, 32.93 billion yuan in 2026, and 35.27 billion yuan in 2027 [2][8]. Financial Summary - The company's projected financial metrics include: - Revenue growth rates of 15.14% for 2024, 14.30% for 2025, 11.58% for 2026, and 7.10% for 2027 [2]. - Net profit attributable to the parent company is expected to be 4.48 billion yuan in 2025, 5.19 billion yuan in 2026, and 5.74 billion yuan in 2027 [2]. - The diluted EPS is projected to be 2.65 yuan in 2025, 3.07 yuan in 2026, and 3.40 yuan in 2027 [2]. - The company’s PE ratio is expected to decrease from 13.15 in 2024 to 8.35 in 2027, indicating improving valuation [2][8]. Business Strategy - The company is implementing a "One Body, Two Wings" strategy, focusing on expanding its waterproofing and coating businesses while solidifying its leading position in the gypsum board market [6]. - A new industrial coating production base is planned in Anhui, which will enhance the company's market competitiveness in central and southwestern China [6].

Core Viewpoint - The company achieved steady performance improvement in Q1 2025, marking a "good start" with revenue and profit growth [2] Financial Performance - In Q1 2025, the company reported revenue of 6.246 billion yuan, a year-on-year increase of 5.09% [1] - The net profit attributable to shareholders was 842 million yuan, reflecting a year-on-year growth of 2.46% [1] Business Development - The company is focusing on solidifying its gypsum board and gypsum board+ business while driving growth in waterproof and coating sectors through both organic and external development [2] - The waterproof business achieved revenue of 1.054 billion yuan, with a year-on-year growth of 10.54%, and a net profit of 43 million yuan, up 19.89% [2] - The coating business saw significant growth, with revenue reaching 908 million yuan, a year-on-year increase of 111.44%, and a net profit of 44 million yuan, up 48.17% [2] - International business continued to perform well, with revenue increasing by 73% year-on-year and net profit rising by 143.08% [2] Profit Forecast and Investment Rating - The company is projected to achieve revenues of 28.820 billion yuan, 32.373 billion yuan, and 36.249 billion yuan from 2025 to 2027, with net profits of 4.462 billion yuan, 4.999 billion yuan, and 5.616 billion yuan respectively [3] - The current stock price corresponds to a PE ratio of 11.2, 10.0, and 8.9 for the years 2025, 2026, and 2027 [3] - The average valuation for comparable companies in 2025 is 23.1 times PE, and the company maintains an "overweight" rating [3]