Investment Rating - The report maintains an "Accumulate-A" rating for the company [1][6] Core Views - The company achieved a significant growth in Q2, with revenue doubling and a strong focus on robotics research and development [1][2] - The company reported a revenue of 250 million yuan in the first half of the year, representing a year-on-year increase of 45.8%, and a net profit of 50 million yuan, also up by 45.9% [2] - In Q2 alone, the revenue reached 150 million yuan, marking a year-on-year increase of 69.5% and a quarter-on-quarter increase of 56.5% [2] Financial Performance - The company’s gross margin for the first half of the year was 34.8%, down by 5.6 percentage points year-on-year, while the net margin improved to 21.9%, up by 0.2 percentage points [5] - The company’s revenue from harmonic reducers and metal components was 200 million yuan, up by 34.4% year-on-year, while mechatronic products saw a revenue increase of 69.7% to 40 million yuan [4][5] - The company’s earnings per share (EPS) for 2025 is projected to be 0.53 yuan, with corresponding price-to-earnings (P/E) ratios of 277.2, 220.8, and 176.8 for 2025, 2026, and 2027 respectively [6][10] Market Position and Strategy - The company is positioned as a leader in domestic harmonic reducers and is expanding its product matrix and capabilities in high-end applications [6] - The establishment of a wholly-owned subsidiary in Shanghai for core components of embodied intelligent robots and a joint venture for developing sensors indicates a strategic focus on robotics [5][6]

Investment Rating - The investment rating for the company is "Buy" with a target price of 171 CNY [1][8]. Core Insights - The company reported a significant revenue increase of 45.8% year-over-year (YOY) for the first half of 2025, achieving 251 million CNY, and a net profit increase of 45.9% YOY, reaching 53 million CNY [9][11]. - The growth in revenue and profit is attributed to the recovery in demand for robotic components, driven by the expansion of the electric vehicle sector and the recovery of consumer electronics [11]. - The company is focusing on enhancing its presence in the embodied intelligence sector, aiming to create a second growth curve by expanding its product offerings in harmonic reducers, ball screws, and actuators [11][15]. Company Overview - The company operates in the mechanical equipment industry and has a market capitalization of 27.034 billion CNY [2]. - The stock price as of August 18, 2025, is 147.46 CNY, with a 12-month high of 192.64 CNY and a low of 58.17 CNY [2]. - Major shareholders include Zuo Jing, holding 18.5% of the shares [2]. Financial Performance - The company achieved a historical high revenue of 153 million CNY in the second quarter of 2025, representing a 69.5% increase YOY [9][11]. - The gross profit margin for the first half of 2025 was 34.8%, a decrease of 5.6 percentage points compared to the previous year [11]. - The company plans to increase its net profit forecasts for 2025, 2026, and 2027 to 100 million CNY, 140 million CNY, and 190 million CNY respectively, reflecting YOY growth rates of 86%, 35%, and 36% [15]. Product Mix - The product mix includes harmonic reducers and metal components (78.3%), mechatronic products (16.6%), and intelligent automation equipment (3.2%) [4]. Institutional Ownership - Institutional investors hold 11.0% of the circulating A-shares, while general corporations hold 11.2% [5].

Investment Rating - The report assigns a "Buy" rating to the company, indicating a potential upside of 15% to 35% [5][12]. Core Insights - The company has shown strong revenue growth in Q1 2025, with a year-over-year increase of 19.65%, driven by a recovery in the domestic downstream market [6][8]. - The company is focusing on the humanoid robot core component sector, which is expected to provide significant growth opportunities in the future [10][13]. - Despite a competitive market leading to a decline in gross margin, the company continues to expand its overseas market presence, particularly in key regions such as Japan, Southeast Asia, North America, and Europe [7][8]. Company Performance - In 2024, the company achieved a revenue of 3.87 billion RMB, representing an 8.77% year-over-year growth, while the net profit was 0.56 billion RMB, down 33.26% year-over-year [8][11]. - The company's revenue from harmonic reducers was 3.25 billion RMB, with a year-over-year growth of 2.56%, while the mechatronic equipment segment saw a significant increase of 56.74% [8][11]. - The gross margin for 2024 was 37.54%, a decrease of 3.60 percentage points compared to the previous year, primarily due to price adjustments in a competitive market [8][11]. Financial Projections - The company is projected to achieve net profits of 0.81 billion RMB in 2025, 1.16 billion RMB in 2026, and 1.51 billion RMB in 2027, with year-over-year growth rates of 44.95%, 41.92%, and 30.92% respectively [11][13]. - The earnings per share (EPS) are expected to be 0.44 RMB in 2025, 0.63 RMB in 2026, and 0.83 RMB in 2027, reflecting a positive growth trajectory [11][13]. Market Position - The company holds a leading position in the harmonic reducer and mechatronic product markets, with a focus on lightweight and compact technologies for humanoid robots [10][13]. - The product mix is heavily weighted towards harmonic reducers and metal components, which account for 84% of total revenue, while mechatronic products and smart automation devices contribute 13.6% and 1.2% respectively [3].