Core Viewpoint - The company reported a decline in revenue and net profit for the first half of 2025, while showing a slight increase in non-recurring net profit, indicating mixed performance amid challenging market conditions [1][2]. Group 1: Financial Performance - In the first half of 2025, the company achieved operating revenue of 10.43 billion, a year-on-year decrease of 7.5% [1]. - The net profit attributable to shareholders was 860 million, down 22.2% year-on-year [1]. - The non-recurring net profit was 810 million, reflecting a year-on-year increase of 2.9% [1]. Group 2: Business Segments - **Natural Gas Business**: The company had good execution of long-term contracts, but faced a decrease in spot resource procurement due to high international LNG prices and price discrepancies [2]. - **LPG Business**: The acquisition of 100% equity in Huakai Petroleum Gas in Nansha District, Guangzhou, was completed, aiming to establish a dynamic dual-storage operation system [2]. - **Special Gases Business**: The helium production capacity was increased to 1.5 million cubic meters per year, with successful supply for rocket launches in Hainan [2]. Group 3: Cash Dividends and Buyback Plan - The company set fixed cash dividends of 850 million for 2025 and 1 billion for 2026, with a planned dividend of 266 million for the first half of 2025, accounting for 31% of the annual plan [2]. Group 4: Profit Forecast and Valuation - Due to fluctuations in international spot natural gas prices, the profit forecast was adjusted, with expected net profits of 1.61 billion, 1.91 billion, and 2.22 billion for 2025-2027 [2]. - The corresponding price-to-earnings ratios are projected at 11.9, 10, and 8.6 times [2].

Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of RMB 36.40 [6][5]. Core Views - The company reported a revenue of RMB 10.428 billion for 1H25, a year-on-year decrease of 7.5%, and a net profit attributable to shareholders of RMB 861 million, down 22.2% year-on-year. However, the adjusted net profit increased by 2.9% year-on-year to RMB 811 million [2]. - The company plans to distribute its first interim dividend of RMB 0.4079 per share, totaling RMB 266 million, which corresponds to a payout ratio of 31.56% [2]. - The acquisition of Huakai LPG receiving station is expected to add 500,000 tons of processing capacity, reinforcing the company's leading position in the South China LPG market [2]. Summary by Sections Natural Gas - In 1H25, the company's natural gas and operation business achieved a gross profit of RMB 680 million, a year-on-year increase of 5%, with a gross margin of 14%, up 3 percentage points year-on-year. The increase in gross margin is attributed to a higher proportion of high-margin transportation fuel and industrial gas [2]. - Natural gas sales slightly decreased year-on-year, with transportation fuel sales increasing, while power plant gas usage decreased due to high international LNG spot prices [2]. LPG - The LPG business generated a gross profit of RMB 290 million in 1H25, a year-on-year decrease of 1%, maintaining a gross margin of 7% [3]. - The company is expanding its market penetration in South China, with a 106% year-on-year increase in sales of gas for chemical raw materials, achieving 340,000 tons in 1H25 [3]. Specialty Gases - The company completed the construction of a helium project in Luzhou, Sichuan, increasing helium production capacity to 1.5 million cubic meters per year. The specialty gases segment is expected to gradually release profitability, becoming an important source of earnings elasticity for the company [4]. Profit Forecast and Valuation - The company is expected to achieve net profits attributable to shareholders of RMB 1.732 billion, RMB 1.993 billion, and RMB 2.285 billion for 2025-2027, with corresponding EPS of RMB 2.60, RMB 2.99, and RMB 3.43, respectively, indicating a CAGR of 11% over the three years [5]. - The target price has been raised to RMB 36.40 based on a 14x PE for 2025, up from the previous target of RMB 32.00 [5].