Core Viewpoint - The company reported a significant decline in net profit for 1H25, aligning with market expectations, primarily due to low prices for chicken and chick sales [1] Financial Performance - 1H25 revenue was 1.32 billion yuan, with a net profit of 6 million yuan, representing year-on-year changes of -4.0% and -96.6% respectively [1] - In 2Q25, revenue reached 698 million yuan, with a net profit of 1.9 million yuan, showing year-on-year changes of +1.4% and -73.8% respectively [1] Sales and Pricing Trends - The company sold 320 million white feather broiler chicks in 1H25, a year-on-year increase of 15.7%, but revenue decreased by 18.6% to 850 million yuan due to a 29.8% drop in average price to 2.7 yuan per chick [2] - Sales of "Yisheng 909" chicks were 46 million, with revenue of 43 million yuan, reflecting a year-on-year decrease of 25.3% [2] - The company sold 38,000 breeding pigs, a significant increase of 354.9%, with revenue of 90 million yuan, up 296.5% [2] Profitability Analysis - The gross margin for 1H25 was 11.8%, down 15.4 percentage points year-on-year, primarily due to falling chick prices [3] - The expense ratios for sales, management, and financial costs were 1.4%, 9.3%, and 0.6% respectively, with changes in financial costs attributed to increased interest income [3] - The net profit margin decreased by 12.8 percentage points to 0.5% [3] Future Outlook - Chick prices remain under pressure, with a reported price of 1.93 yuan per chick as of July 25, down 37% year-on-year [3] - The company is expanding breeding capacity and product sales, including "Yisheng 909" and breeding pigs, while also implementing an employee stock ownership plan to strengthen long-term development [3] Earnings Forecast and Valuation - The net profit forecast for 2025 has been reduced by 37% to 295 million yuan, while the 2026 forecast remains at 620 million yuan [4] - The current stock price corresponds to P/E ratios of 33 and 16 for 2025 and 2026, respectively, with a target price of 10.0 yuan indicating a 13% upside potential [4]