Fundraising and Usage - The company raised a total of RMB 610.55 million through the issuance of convertible bonds, with a net amount of RMB 600.35 million after deducting related fees [1] - As of June 30, 2025, the company has utilized RMB 531.35 million of the raised funds, leaving a balance of RMB 34.82 million in the special account [1][2] - The company has not transferred or replaced any projects funded by the previous fundraising [1] Changes in Fund Allocation - The implementation subject of the liquid intelligent packaging production line project was changed from a wholly-owned subsidiary to another wholly-owned subsidiary, with no change in the investment amount or purpose [1] - There are no discrepancies between the actual investment total and the committed total for the previous fundraising projects [1] Financial Management of Idle Funds - The company temporarily supplemented working capital with idle funds amounting to RMB 150 million, with a usage period of 12 months [2] - The company has not used idle funds for purchasing structured deposits or wealth management products as of June 30, 2025 [2] Project Benefits and Performance - The liquid intelligent packaging production line project is expected to generate a net profit of RMB 68.87 million in the first year, RMB 103.63 million in the second year, and RMB 102.36 million from the third year onward [2][3] - The actual benefits from the investment projects have been calculated consistently with the promised benefits [3]

Fundraising Overview - The company raised a total of RMB 610.55 million through the issuance of convertible bonds, with a net amount of RMB 600.35 million after deducting fees [1] - As of June 30, 2025, the company has utilized RMB 53.13 million of the raised funds, with a remaining balance of RMB 34.82 million [1][3] Fund Management - The company has established a dedicated account for managing the raised funds, in compliance with relevant laws and regulations [2][3] - A tripartite supervision agreement was signed with the underwriter and banks to clarify the rights and obligations of all parties involved [3] Fund Utilization - The company has allocated RMB 42.75 million of the raised funds for the construction of a liquid intelligent packaging production line [3] - The company temporarily supplemented working capital with RMB 50 million from the raised funds, which has positively impacted its operational capacity and financial condition [5] Project Changes - The implementation entity for the liquid intelligent packaging production line project has been changed from Zhejiang Meihua Packaging Machinery Co., Ltd. to Yongchuang Zhiyun (Zhejiang) Machinery Equipment Co., Ltd., with the project location also being updated [5][10] - The changes in project implementation do not affect the purpose, direction, or investment amount of the project [10] Compliance and Reporting - The company has ensured timely, truthful, accurate, and complete disclosure of information related to the raised funds, with no violations in fund management [6]

Core Viewpoint - The company reported its 2024 annual results and Q1 2025 results, showing a mixed performance with revenue growth but a significant decline in net profit due to various challenges [1]. Financial Performance - In 2024, the company achieved revenue of 3.57 billion, a year-on-year increase of 13%; however, the net profit attributable to shareholders was 16 million, a decrease of 78% year-on-year; operating cash flow was 260 million, up 21% year-on-year [1]. - For Q1 2025, the company reported revenue of 890 million, a 7% increase year-on-year; net profit attributable to shareholders was 41 million, a 6% increase year-on-year; operating cash flow was 77 million, a significant increase of 138% year-on-year [1]. Business Segments - The company’s main business lines showed positive revenue growth, with total new orders amounting to approximately 4.5 billion, a year-on-year increase of about 14% [2]. - Smart packaging production lines generated revenue of 1.56 billion (up 9% year-on-year) with a gross margin of 25.5% (down 7.2 percentage points); beverage industry orders increased by about 37% due to higher capital expenditure and market share growth [2]. - Standard single machine equipment revenue reached 1.3 billion (up 21% year-on-year) with a gross margin of 25.4% (down 2.5 percentage points); new orders for standard single machine equipment grew by about 13% [2]. - Packaging materials generated revenue of 370 million (up 31% year-on-year) with a gross margin of 10.3% (up 0.9 percentage points); new orders for packaging materials increased by about 22% [2]. Future Outlook - The company is advancing its humanoid robot product development and has launched an equity incentive plan, indicating a potential turning point for its main business in 2025 [3]. - The company plans to issue 5.08 million restricted stock incentives, with conditions for lifting restrictions based on revenue and net profit targets for 2025-2027 [3]. - The company anticipates that the completion of liquid intelligent packaging production lines in 2024 will add 24 new production lines, potentially generating a net profit of 102 million [3]. Profit Forecast and Valuation - Revenue projections for 2025-2027 are estimated at 4 billion, 4.5 billion, and 5.1 billion, with year-on-year growth rates of 12%, 13%, and 13%; net profit attributable to shareholders is forecasted at 137 million, 204 million, and 299 million, with growth rates of 780%, 49%, and 47% respectively [4]. - The corresponding price-to-earnings ratios are projected to be 33, 22, and 15 times, with a compound annual growth rate of 168% for net profit from 2024 to 2027 [4].

Investment Rating - The investment rating for the company is "Buy" [3] Core Views - The company has shown a revenue growth of 13% year-on-year in 2024, reaching 3.57 billion yuan, but the net profit attributable to shareholders decreased by 78% to 0.16 billion yuan due to various factors including increased costs and changes in product structure [1] - The company is expected to see a turning point in its main business in 2025, driven by product upgrades, category expansion, and domestic substitution [2][3] Summary by Sections Financial Performance - In 2024, the company achieved a revenue of 3.57 billion yuan, a 13% increase year-on-year, with a net profit of 0.16 billion yuan, down 78% [1] - For Q1 2025, the company reported a revenue of 0.89 billion yuan, a 7% increase year-on-year, and a net profit of 0.41 billion yuan, up 6% [1] - The operating cash flow for 2024 was 0.26 billion yuan, a 21% increase year-on-year, while Q1 2025 saw a significant increase of 138% to 0.77 billion yuan [1] Business Segments - The smart packaging production line generated 1.56 billion yuan in revenue, a 9% increase, with a gross margin of 25.5% [1] - Standard single machine equipment revenue reached 1.3 billion yuan, up 21%, with a gross margin of 25.4% [1] - Packaging materials revenue grew by 31% to 0.37 billion yuan, with a gross margin of 10.3% [2] Future Outlook - The establishment of a subsidiary focused on humanoid robots indicates a strategic entry into a new growth area [2] - The company plans to implement a stock incentive plan, with performance targets set for revenue and net profit from 2025 to 2027 [2] - Revenue projections for 2025-2027 are 4.0 billion, 4.5 billion, and 5.1 billion yuan, respectively, with net profits expected to grow significantly [3]

Investment Rating - The report maintains a "Buy" rating for the company [4] Core Views - The company plans to issue a stock incentive plan for 5.08 million restricted shares, representing about 1% of the total share capital, which reflects confidence in future growth [1] - The humanoid robot business is expected to open up growth opportunities, with a projected demand of approximately 2.1 million units in the manufacturing and home service sectors by 2030, translating to a market space of about 314.6 billion RMB [2] - The company's main business is anticipated to reach a turning point in 2025, driven by product upgrades, category expansion, and domestic substitution [3] Summary by Sections Stock Incentive Plan - The company announced a stock incentive plan for 2025, targeting 78 individuals with performance-based vesting conditions over three years [1] - The conditions for lifting restrictions include revenue growth of at least 30% in 2025, 40% in 2026, and 50% in 2027, or net profit growth of at least 60%, 70%, and 80% respectively [1][12] Humanoid Robot Business - The establishment of a subsidiary focused on humanoid robots indicates a strategic entry into a growing market [2] - The humanoid robot industry is accelerating, with significant advancements from competitors, suggesting a competitive landscape [2] Main Business Outlook - The company is expected to benefit from a steady increase in orders and the upcoming production of liquid intelligent packaging lines, which could add approximately 1.02 billion RMB in net profit annually [3] - The global packaging equipment market is projected to grow from 55.1 billion USD in 2023 to 77.7 billion USD by 2032, with a CAGR of 3.9% [3] - The company is diversifying its product line, which is expected to enhance its competitive edge and reduce the gap with global leaders [3] Financial Forecast - Revenue projections for 2024-2026 are estimated at 3.33 billion, 3.97 billion, and 4.91 billion RMB, with year-on-year growth rates of 6%, 19%, and 24% respectively [4] - The net profit forecast for the same period is 0.18 billion, 1.86 billion, and 2.70 billion RMB, with significant growth expected in 2025 [4][6]