Core Viewpoint - The company reported a steady growth in revenue and net profit for the first three quarters of 2025, indicating a robust operational performance and benefiting from the automotive industry's favorable conditions [1][2]. Financial Performance - For the first three quarters of 2025, the company achieved revenue of 1.121 billion, a year-on-year increase of 7.52% - The net profit attributable to shareholders reached 236 million, up 5.06% year-on-year - The net profit excluding non-recurring items was 221 million, reflecting a 6.06% year-on-year growth - In Q3 2025, the company recorded revenue of 404 million, a year-on-year increase of 17.20% - The net profit attributable to shareholders for Q3 was 88 million, up 8.20% year-on-year - The net profit excluding non-recurring items for Q3 was 82 million, a year-on-year increase of 10.46% [1][2]. Industry Context - The automotive industry in China saw a total sales volume of 24.363 million units from January to September 2025, representing a year-on-year increase of 12.90% - New energy vehicle sales reached 11.2276 million units, showing a significant year-on-year growth of 34.95% - The company is expected to benefit from the overall demand in the automotive sector, particularly in turbocharger core components and expanding its production scale for new energy vehicle parts [2]. Profitability Metrics - The company's gross profit margin for Q3 2025 was 34.37%, a decrease of 0.78 percentage points year-on-year - The net profit margin was 21.72%, down 1.78 percentage points year-on-year - The company improved its expense ratio by 0.5 percentage points year-on-year, with specific changes in sales, management, R&D, and financial expense ratios [2]. Business Development - The company is advancing its screw rod business and expanding its layout in linear motion components, targeting high-end machine tools, automation, humanoid robots, and intelligent connected vehicles - The subsidiary Yuhua Precision Machinery has developed a high-precision double-end face center hole grinding machine and a ball screw pair lifespan testing machine, enhancing processing precision - The company has achieved the highest industry precision level for its ball screw pairs and linear guide pairs, and has secured bulk delivery orders from well-known domestic machine tool manufacturers [3]. International Expansion - The company is accelerating the construction of its subsidiary in Thailand to enhance production capacity and improve international competitiveness - The Thai subsidiary aims to serve as a hub for deepening market penetration in Southeast Asia and extending reach to Australia, New Zealand, and South Asia, leveraging regional trade agreements to reduce logistics costs [3]. Investment Outlook - The company maintains a "buy" rating, with projected net profits of 326 million and 390 million for 2025 and 2026, respectively, corresponding to price-to-earnings ratios of 38x and 31x [4].

Investment Rating - The investment rating for the company is "Buy" and is maintained [9]. Core Views - The company reported a steady operation in Q3 2025, with revenue and net profit both showing quarter-on-quarter increases, achieving record highs for a single quarter. The overall business performance is stable, benefiting from a relatively favorable automotive industry this year [2][6]. - For the first three quarters of 2025, the company achieved revenue of 1.121 billion, a year-on-year increase of 7.52%, and a net profit attributable to the parent company of 236 million, up 5.06%. In Q3 2025 alone, revenue reached 404 million, a year-on-year increase of 17.20%, with net profit at 88 million, up 8.20% [6][2]. - The company continues to enhance its market share in core components for turbocharging and is expanding its production scale for new energy vehicle components, laying a solid foundation for stable growth [2][6]. - The company's ball screw business is progressing steadily, with a comprehensive layout in linear motion components. This year, the company has delivered batch orders for machine tool ball screws and is optimizing production processes for humanoid ball screws [2][6]. - The company is advancing the construction of its subsidiary in Thailand to enhance overseas production capacity and improve its international competitiveness, targeting the Southeast Asian market and beyond [2][6]. Summary by Sections Financial Performance - In Q3 2025, the company achieved a gross profit margin of 34.37%, a decrease of 0.78 percentage points year-on-year, and a net profit margin of 21.72%, down 1.78 percentage points year-on-year. The increase in revenue was accompanied by an improvement in the expense ratio [2][6]. - The company’s net profit for 2025 is projected to be 326 million and 390 million for 2026, corresponding to price-to-earnings ratios of 38x and 31x, respectively [2][6]. Business Development - The company is focusing on high-end machine tools, automation, humanoid robots, and intelligent connected vehicles in its ball screw business. It has developed high-precision equipment to enhance processing accuracy [2][6]. - The company’s products have been applied in well-known domestic machine tool models and have secured batch delivery orders [2][6]. Market Outlook - The domestic automotive sales reached 24.363 million units in the first nine months of 2025, a year-on-year increase of 12.90%, with new energy vehicle sales at 11.2276 million units, up 34.95% [2][6].

Investment Rating - The investment rating for the company is "Buy" and is maintained [8] Core Views - The company reported stable growth in its 2025H1 performance, with revenue reaching 716 million, a year-on-year increase of 2.73%, and a net profit attributable to shareholders of 148 million, up 3.30% year-on-year [6][12] - The automotive industry demand is improving, which, combined with the release of production capacity for new energy vehicle components, solidifies the company's revenue and performance growth [12] - The company's profitability remained stable in 2025Q2, with a gross profit margin of 35.21%, an increase of 1.03 percentage points year-on-year, and a net profit margin of 21.58%, up 0.56 percentage points year-on-year [12][12] - The company's screw rod business is progressing steadily, with successful batch deliveries of products such as ball screw assemblies and linear guide assemblies [12][12] - The company is accelerating its overseas business expansion, particularly in the construction of its subsidiary in Thailand, aiming to enhance its international competitiveness [12][12] Summary by Sections Financial Performance - In 2025H1, the company achieved revenue of 716 million, a year-on-year increase of 2.73%, and a net profit of 148 million, up 3.30% year-on-year [6][12] - For 2025Q2, revenue was 367 million, reflecting a year-on-year growth of 3.55%, and net profit was 79 million, up 6.15% year-on-year [6][12] Business Development - The screw rod business is advancing, with the company achieving significant technical breakthroughs and securing batch orders from well-known domestic machine tool manufacturers [12][12] - The company is focusing on enhancing its production processes and expanding its product offerings in the new energy vehicle sector [12][12] Market Expansion - The company is actively developing its overseas market, with plans for its Thailand subsidiary to be operational by Q4 2025, aiming to penetrate the Southeast Asian market and beyond [12][12]