Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [4]. Core Insights - The company is a global leader in corrugated paper equipment with a market share of approximately 15%, ranking first in China and among the top two globally. It is actively expanding into emerging industries, particularly in water propulsion equipment and sectors related to "artificial intelligence + robotics" and "controlled nuclear fusion and high-end nuclear power equipment" [4][10]. - The report anticipates revenue growth for 2025E, 2026E, and 2027E to be 53.72 billion, 59.74 billion, and 67.58 billion RMB, respectively, with year-on-year growth rates of 12.4%, 11.2%, and 13.1%. The net profit attributable to the parent company is expected to reach 7.01 billion, 8.42 billion, and 10.31 billion RMB for the same years, reflecting growth rates of 40.0%, 20.0%, and 22.5% [4][22]. Financial Data and Profit Forecast - Total revenue (in million RMB) is projected as follows: - 2023: 4,746 - 2024: 4,778 - 2025E: 5,372 - 2026E: 5,974 - 2027E: 6,758 - Year-on-year growth rates are expected to be 21.9%, 0.7%, 12.4%, 11.2%, and 13.1% respectively [2]. - Net profit attributable to the parent company (in million RMB) is forecasted as: - 2023: 433 - 2024: 501 - 2025E: 701 - 2026E: 842 - 2027E: 1,031 - Year-on-year growth rates for net profit are projected at -3.1%, 15.5%, 40.0%, 20.0%, and 22.5% [2][22]. Business Segments and Industry Context - The company operates in several strategic emerging industries, including: - Marine equipment manufacturing, focusing on water propulsion devices such as outboard motors, which are widely used in recreational boating, fishing, and emergency rescue [9]. - Intelligent manufacturing equipment, including corrugated board production lines and digital printing equipment, which are essential for the packaging industry [9]. - The global market for corrugated packaging equipment is estimated to be around 30-40 billion RMB, with a high concentration of market share [4][10]. - The report highlights the company's strategic investments in robotics and nuclear power sectors, indicating a shift from traditional equipment to high-end manufacturing [4][10].

Core Viewpoint - The company, Dongfang Precision, announced plans to sell 100% equity in Fosber Group, Fosber Asia, and Tiruña Asia for cash, which are key operators of its corrugated cardboard production line business, contributing nearly 70% of its revenue in 2024. This move aims to deepen strategic focus and shift towards developing water propulsion equipment and emerging industries [1][4][14]. Financial Performance - In 2024, the assets being sold accounted for 39.66% of the company's total assets and 30.23% of its net assets, while contributing 67.20% of its total revenue [5][17]. - The company's revenue from intelligent corrugated packaging equipment was 84% in 2024, indicating that the sale represents a significant divestment from its traditional business [17]. Business Strategy - The sale is part of a strategy to increase investment in the water propulsion equipment sector, with the goal of becoming a world-class supplier in this field [17]. - The company has previously engaged in multiple cross-industry acquisitions, including the successful acquisition of Baisheng Power in 2015, which is now the main operator of its water propulsion equipment business [17][18]. Market Position - Baisheng Power's main product is outboard motors, which are characterized by high technical value. However, the company faces significant competition from established brands like Yamaha and Mercury, with Baisheng's revenue in 2024 being less than $10 million compared to Yamaha's $2.141 billion [19][19]. - The outboard motor business has shown weak profitability, with a gross margin of 21.38% in the first half of 2025, significantly lower than the company's traditional corrugated packaging equipment business [19]. Challenges and Risks - The company has faced challenges in its cross-industry ventures, notably a significant impairment loss of 3.926 billion yuan related to its acquisition of a battery pack manufacturer, highlighting the risks associated with entering new industries without prior experience [20][21]. - The company is also venturing into the field of embodied intelligence, competing with both emerging startups and established electronics giants, which adds to the complexity of its strategic direction [24].

Core Viewpoint - The transaction by Dongfang Precision Engineering to sell its core European asset to a U.S. capital firm for 6.3 billion RMB is seen as a strategic shift rather than a forced retreat, reflecting a proactive decision to pivot towards new growth areas [1][3][9]. Financial Summary - The total assets of the target company are 298,594.02 million RMB, while the listed company has total assets of 752,857.70 million RMB, indicating that the target company represents 39.66% of the listed company's total assets [7]. - The net assets of the target company are 150,463.78 million RMB, compared to the listed company's net assets of 497,737.95 million RMB, which means the target company accounts for 30.23% of the listed company's net assets [7]. - The revenue of the target company is 321,063.44 million RMB, while the listed company has revenue of 477,785.56 million RMB, showing that the target company contributes 67.20% to the listed company's revenue [7]. Strategic Shift - The sale of the European asset is part of a broader strategic transition for Dongfang Precision Engineering, moving away from traditional manufacturing towards new industries such as marine power equipment and intelligent robotics, which are supported by national policies [11][20]. - The company has already achieved a degree of localization and replacement in its marine equipment segment, indicating potential for breakthroughs in a market dominated by foreign giants [11][15]. Market Context - The competitive landscape in the new sectors is intense, and success will depend on technological breakthroughs and capital investment. The company aims to leverage the funds from the asset sale to enhance its competitiveness in these new areas [13][20]. - The transaction is not merely a financial maneuver but a calculated risk to reposition the company for future growth, reflecting a trend among traditional manufacturers in China to seek transformation towards smart and green manufacturing [22]. Regulatory Considerations - The transaction will undergo multiple approval processes, including shareholder meetings and foreign investment reviews in Italy and the U.S., which could impact the completion of the deal [17][20].

Core Viewpoint - Dongfang Precision Engineering plans to divest its corrugated cardboard production line business for €774 million, marking a strategic shift towards waterborne power equipment and embodied intelligent robotics [1][2]. Group 1: Asset Sale Details - The company will sell 100% equity of three companies, including Italy's Fosber Group, for €774 million, which represents a significant asset appreciation of over 7 times compared to the initial acquisition cost of approximately €74 million [2]. - The divested assets account for 39.66% of the company's total assets, 30.23% of net assets, and 67.2% of operating revenue for 2024, indicating a major asset restructuring [2]. Group 2: Strategic Shift - The divestiture is aimed at optimizing resource allocation and enhancing operational efficiency, allowing the company to focus on emerging business areas [2]. - The company retains its printing and packaging production lines, industrial internet solutions, and digital printing equipment, ensuring stable revenue and profit to support its strategic transformation [3]. Group 3: New Growth Path - Dongfang Precision Engineering is focusing on two main areas: waterborne power equipment and embodied intelligent robotics, aiming to capture opportunities in strategic emerging industries [4]. - The subsidiary, Baisheng Power, has become a leader in the outboard motor industry, with a projected annual compound growth rate of 22% in revenue and net profit from 2020 to 2024 [4]. - The company plans to enhance its product matrix in the outboard motor sector, including gasoline, diesel, and new energy options [4]. Group 4: Robotics Ecosystem - The company is building a complete ecosystem for embodied intelligent robotics through investments and self-operation, including partnerships with various robotics firms [5]. - A new subsidiary, Dongfang Yuanqi, will serve as the core platform for robot manufacturing, further solidifying the company's position in the robotics market [5]. Group 5: Financial Performance - The company's transformation efforts are showing positive results, with total revenue of 3.389 billion yuan and a net profit of 510 million yuan for the first three quarters of 2025, reflecting a year-on-year growth of 2.52% and 54.64%, respectively [6].

Group 1: Strategic Focus and Asset Sale - The company aims to optimize resource allocation and focus on domestic development of technology and new productivity businesses by selling certain assets, with a strategic shift towards emerging industries [2][4][7]. - The asset sale is part of the company's commitment to the national "new productivity" strategy and technology transformation, with a focus on high-end intelligent equipment manufacturing [3][5][7]. - The base consideration for the asset sale is €774 million, which will be prudently managed to support the implementation of the technology transformation strategy [8]. Group 2: Business Development and Investment - The company plans to increase investment in its water propulsion equipment business, particularly in the subsidiary Baisheng Power, which has seen a compound annual growth rate (CAGR) of over 20% in revenue and net profit over the past five years [9][10]. - Baisheng Power is positioned to become a world-class supplier of water propulsion equipment, with a focus on developing high-horsepower outboard engines [11]. - The company has made strategic investments in artificial intelligence and robotics, as well as controllable nuclear fusion, to align with national development strategies and explore new growth areas [12][13][15]. Group 3: Market Position and Future Outlook - The global market for outboard engines exceeds $100 billion, with leading brands like Yamaha and Mercury generating significant revenues, highlighting the growth potential for Baisheng Power [10]. - The new manufacturing base in Suzhou is expected to enhance production capacity and support the launch of advanced products, contributing to future sales growth [11]. - The company is committed to enhancing shareholder returns, having distributed over ¥2.1 billion in dividends and share buybacks since its listing [8].

Core Viewpoint - The company is selling 100% equity of Fosber Group, Fosber Asia, and Tirua Asia to Foresight US and Foresight Italy for a total price of €774 million (approximately 6.3 billion RMB), aiming to increase investment in waterborne power equipment and focus on strategic emerging industries [1] Group 1: Transaction Details - The transaction price consists of a base price of €774 million and a lockbox interest based on the expected net cash profit of the target companies from the lockbox date to the closing date [1] Group 2: Strategic Focus - The company aims to increase investment in waterborne power equipment, holding a 71.14% stake in Baisheng Power, a leading domestic outboard motor company with a compound annual growth rate of over 20% in revenue and net profit over the past five years [2] - The global outboard motor market is projected to reach $15.975 billion by 2030, with the Chinese market expected to be $588 million [2] - The company plans to leverage its cash reserves post-transaction to enhance its investment in strategic emerging industries, particularly in the "artificial intelligence + robotics" sector [3] Group 3: Investment in Robotics - The company has signed a strategic cooperation agreement with Leju Robotics to focus on humanoid robot manufacturing and intelligent control systems [4] - The company has invested in Ruoyu Technology, which specializes in the development of intelligent robot brains, holding approximately 30% equity after additional investment [4] - The company holds about 20% equity in Jiaten Robotics, a leading provider of AGV robots and intelligent logistics systems, with products used by over 70 Fortune 500 companies [5] Group 4: Future Revenue Projections - The company is expected to achieve revenues of 5.303 billion RMB, 5.578 billion RMB, and 6.450 billion RMB for the years 2025 to 2027, with corresponding net profits of 703 million RMB, 845 million RMB, and 1.04 billion RMB [6]

Investment Rating - The investment rating for the company is "Buy-A" with a target price of 22.18 CNY, maintaining the rating [5][11]. Core Views - The company is selling its traditional corrugated line business to optimize resource allocation and focus on domestic technological and new productivity business development [2][10]. - The sale of the Fosber Group and its subsidiaries is part of a strategic decision to reduce international management pressure and enhance operational efficiency [2][3]. - The company aims to increase investment in its water propulsion equipment business and further concentrate on strategic emerging industries in manufacturing [4][10]. Summary by Sections Business Overview - The company's main business includes intelligent packaging equipment and water propulsion equipment, with the sale involving the corrugated board production line business [3]. - The total base price for the assets being sold is 774 million euros, with an adjustment mechanism based on expected net cash profits [3]. Market Strategy - The company is enhancing its market penetration in Europe and the US for high-power and electric products while exploring emerging markets in Africa and Asia [4]. - A dual technology approach of "traditional + electric" is being implemented to expand product lines and strengthen core technology applications [4]. Financial Performance - The company expects revenue growth from 54.50 billion CNY in 2025 to 73.28 billion CNY in 2027, with a compound annual growth rate of approximately 16.2% [10][12]. - Net profit is projected to grow from 704 million CNY in 2025 to 1.007 billion CNY in 2027, reflecting a strong growth trajectory [11][12]. Future Outlook - Post-transaction, the company will focus on enhancing its capabilities in the water propulsion equipment sector, aiming to increase its market share and influence internationally [8][10]. - The company has a strong commitment to shareholder returns, having distributed over 2.1 billion CNY in dividends and share buybacks since its listing [10].

Core Viewpoint - The company, Dongfang Precision, plans to sell its corrugated cardboard production line business, including the Italian Fosber Group, for a total of €774 million in cash, marking a significant asset restructuring move [2][4][6]. Transaction Details - The transaction involves the sale of 100% equity in Fosber S.p.A. and its subsidiaries, Fosber Asia, and Tirua Asia to Foresight US BidCo, Inc. and Foresight Italy BidCo S.p.A. [3][6]. - The core asset, Fosber Group, has a base price of €637 million, which represents a more than sevenfold increase from the approximately €74 million acquisition cost [4][9]. Financial Impact - The assets being sold account for 39.66% of the company's total assets, 30.23% of net assets, and 30.23% of operating revenue for 2024, indicating a substantial impact on the company's financial structure [6][7]. - The total assets of the target company are €298.59 million, while the listed company has total assets of €752.86 million, highlighting the scale of the transaction [7]. Strategic Rationale - The company aims to optimize resource allocation and focus on domestic development in technology and new productivity sectors, responding to national strategic directives [10][12]. - The sale is viewed as a strategic choice rather than a simple divestment, intended to maximize shareholder value and support the company's transition towards new productivity sectors [12]. Future Focus - Post-transaction, the company will continue to operate in printing packaging, water propulsion equipment, industrial internet solutions, and digital printing equipment, ensuring stable revenue and profit streams [13]. - The company plans to enhance its core platform, Baisheng Power, in the outboard motor industry, which has a global market size exceeding ¥100 billion, with a focus on high-power, high-efficiency, and low-emission products [12][13].

Core Viewpoint - The company, Dongfang Precision (002611), plans to sell 100% equity of its corrugated cardboard production line business, including the Italian Fosber Group, for a cash transaction amounting to €774 million, marking a significant increase in asset value since its acquisition [1][3][6]. Group 1: Transaction Details - The transaction involves the sale of Fosber S.p.A. and its subsidiaries, Fosber Asia, and Tiruña Asia, with a core asset price of €637 million, which is over seven times the initial acquisition cost of approximately €74 million [2][6]. - The assets being sold represent 39.66% of the company's total assets, 30.23% of net assets, and 30.23% of operating income for 2024, indicating a major asset restructuring [3][4]. Group 2: Strategic Rationale - The decision to sell is part of a strategic shift to optimize resource allocation and focus on domestic development in technology and new productivity sectors, responding to national strategic directives [7][8]. - The company aims to enhance its competitive advantage in strategic emerging industries, particularly in the marine power equipment sector, which has a global market size exceeding ¥100 billion [8]. Group 3: Future Outlook - Post-transaction, the company will retain significant operations in printing packaging, marine power equipment, industrial internet solutions, and digital printing equipment, ensuring stable revenue and profit growth [9]. - The company plans to increase R&D investment in high-power outboard motors and electric outboard motors, aiming to upgrade its product offerings towards higher efficiency and lower emissions [8].

Group 1 - The company has signed a strategic cooperation agreement with Leju Robotics to focus on humanoid robot manufacturing and intelligent control systems, aiming for production, scene expansion, and business promotion [1] - A joint venture has been established with Leju and Heertai to specialize in intelligent control systems for humanoid robots, targeting core scenarios such as industrial operations and human-robot collaboration [1] - Leju Robotics has launched the KUAVO 5/5-W dual-mode robot, designed for industrial applications, featuring 41 degrees of freedom and a maximum load of 5 kg, with a battery life of over 2 hours for KUAVO 5 and 8 hours for KUAVO 5-W [1] Group 2 - The company has invested in Ruoyu Technology, which focuses on the development and application of intelligent robot brains, with its self-developed "Ruoyu·Jiutian" multimodal model reaching 13 billion parameters [2] - Ruoyu Technology's collaboration with the company aims to create a closed loop of "scene + data + algorithm," enhancing both parties' capabilities in digitalization and intelligence [2] - The company holds approximately 20% of Jiaten Robotics, a leading provider of AGV robots and intelligent logistics systems, with products used by over 70 Fortune 500 companies [2] Group 3 - The company has increased its stake in Aerospace New Power to 19.89%, focusing on high-end metal materials and nuclear power components, being one of the first to obtain nuclear power manufacturing licenses in China [3] - Aerospace New Power's products are utilized in all existing and under-construction nuclear power projects in China, with a successful shipment of magnet support products for the BEST project [3] - The company's subsidiary, Baisheng Power, holds a 71.14% stake and has achieved significant growth in the domestic outboard motor market, breaking the monopoly of American and Japanese brands [3] Group 4 - Revenue projections for the company are estimated at 5.278 billion, 5.951 billion, and 6.911 billion yuan for 2025-2027, with corresponding net profits of 707 million, 849 million, and 1.038 billion yuan [4] - The company maintains a "recommended" rating due to its deep involvement in the humanoid robot industry chain and potential growth in smart logistics, nuclear fusion, and outboard motor sectors [4]