Investment Rating - The investment rating for Tianma Zhikong (688570) is "Buy" [1] Core Views - The strategic investment in the joint venture "Kegong Chengtai Company" aims to enhance long-term high-quality development through collaboration and resource complementarity, focusing on the development of intelligent mining equipment [2][3] - The partnership is expected to significantly expand market space by leveraging synergies between Tianma Zhikong's core products and Kegong Chengtai's focus on high-end hydraulic supports [2] - The joint venture will also facilitate technological innovation and address existing bottlenecks in key technology areas, enhancing Tianma Zhikong's competitive edge in the intelligent mining sector [2][3] Financial Summary - Total revenue for 2023 is projected at 2,206 million, with a year-on-year growth of 12.1%. However, a decline of 15.7% is expected in 2024, followed by a significant drop of 45.5% in 2025 [4] - Net profit attributable to the parent company is forecasted to be 425 million in 2023, decreasing to 340 million in 2024, and further to 107 million in 2025, reflecting a year-on-year decline of 20.0% and 68.4% respectively [4] - The gross margin is expected to decrease from 45.1% in 2023 to 36.3% in 2025, indicating potential pressure on profitability [4] - The company maintains a solid financial position with cash reserves of 2.33 billion as of September 2025, allowing for strategic investments without impacting short-term dividend capabilities [6] - Earnings per share (EPS) is projected to decline from 0.98 in 2023 to 0.25 in 2025, with a gradual recovery expected thereafter [4][6] Strategic Initiatives - The investment in Kegong Chengtai Company is seen as a key move to optimize capital allocation and tap into the intelligent mining equipment sector, potentially leading to stable returns and growth in core business areas [6] - The company is positioned to benefit from the ongoing transformation and high-quality development of the coal industry, with significant opportunities in intelligent mining solutions driven by national policies and market demand [6]

Group 1: Report Overview - The research is about Shandong Mining Machinery in the special equipment industry, and the research date is May 15, 2025 [1][2][17] Group 2: Research Details 1. Basic Research Information - The research object is Shandong Mining Machinery, belonging to the special equipment industry. The reception time is May 15, 2025, and the reception staff are the secretary of the board Qin Decai and the securities representative Zhang Lili [17] 2. Detailed Research Institutions - The reception objects include investors' online questions and others [20] 3. Investor Questions and Company Responses - **Globalization Strategy**: The company uses its advantages, forms professional teams, participates in foreign industry exhibitions, and invites customers to visit. It has entered foreign markets and promoted business development through project radiation and word - of - mouth. It will seek cooperation in the whole industry chain and broader fields [24] - **Industry Outlook**: With the deepening of coal reform, the coal - machine manufacturing industry will combine modern information technologies such as big data, artificial intelligence, and the Internet of Things with products, enhancing competitiveness [24] - **Intelligent Bulk Material Conveying Equipment Business**: The business has developed rapidly. In 2024, the operating income was 291 million yuan, a year - on - year increase of 32.49%. The products have high intelligence and automation, and have entered the international market [24][25] - **Company Business**: Shandong Mining Machinery is a diversified group company mainly engaged in coal - machine production and sales, along with businesses such as intelligent bulk material conveying equipment, building materials machinery, packaging and printing machinery, and precision machining [25] - **Progress in Intelligent Products in 2024**: The self - developed electro - hydraulic control system achieved multiple sales. Many new products were developed and upgraded. Wireless sensors and controllers were developed, and relevant licenses and certifications were obtained [25][26] - **New Profit Growth Points**: The company will implement the "Five - Transformation Strategy", deepen the "Accessories Strategy", increase R & D investment, carry out technological innovation, and seek the integration of capital and industry [26]

Group 1: Global Strategy and Market Expansion - The company aims to enhance its global strategy by leveraging its strengths, forming specialized teams, participating in international trade shows, and inviting clients for site visits [1] - In 2024, overseas revenue increased by 141.02%, although it still represents a low proportion of total income [1] Group 2: Industry Trends and Innovations - The coal machinery manufacturing industry is expected to continue its innovation-driven growth, focusing on smart transformation, optimization of industry structure, and green development [2] - The integration of modern information technologies such as big data and artificial intelligence is enhancing product competitiveness [2] Group 3: Business Development and Revenue Growth - The intelligent bulk material conveying equipment business has seen rapid development, with a revenue of 291 million yuan in 2024, marking a year-on-year growth of 32.49% [2] - The company is diversifying its operations, including coal machinery production, intelligent conveying equipment, building materials machinery, and precision machining [2] Group 4: Product Innovation and R&D - The company has made significant progress in smart products, including the development of multiple new products and upgrades, achieving certifications for various intelligent control systems [3] - The company is committed to enhancing its "component" strategy, increasing R&D investment, and pursuing technological innovations to improve its manufacturing capabilities [4]