Investment Rating - The report assigns a "Buy" rating to the company, indicating a potential upside of 15% to 35% [7][10]. Core Views - The company achieved a revenue of 1.11 billion RMB in H1 2025, representing a year-over-year increase of 14.7%, with a net profit of 60 million RMB, up 45.1% year-over-year [8][10]. - The growth in revenue is primarily driven by the air conditioning compressor business, which saw a significant increase in orders [10]. - The company is actively investing in the screw rod production line, with ongoing construction of a factory in Kunshan and plans for an international base in Thailand [10]. Summary by Sections Company Overview - The company operates in the automotive industry, with a current A-share price of 41.35 RMB and a market capitalization of approximately 13.99 billion RMB [2]. - Major shareholder is Jing Kun, holding 31.57% of shares [2]. Financial Performance - In Q2 2025, the company reported a revenue of 570 million RMB, a year-over-year increase of 18.8%, and a net profit of 30 million RMB, up 48.8% year-over-year [8][10]. - The gross profit margin improved to 19.1% in H1 2025, with a net profit margin of 4.94%, reflecting a year-over-year increase of 1.03 percentage points [10]. Business Segments - The revenue breakdown shows that the chassis components business contributed 710 million RMB (up 4.1% YoY), the air conditioning compressor business contributed 310 million RMB (up 42.1% YoY), and the aluminum lightweight business contributed 90 million RMB (up 35.0% YoY) [10]. Future Projections - The company forecasts net profits of 110 million RMB, 140 million RMB, and 180 million RMB for 2025, 2026, and 2027, respectively, with year-over-year growth rates of 48%, 33%, and 30% [10][12]. - The expected earnings per share (EPS) for the same years are projected to be 0.31 RMB, 0.42 RMB, and 0.54 RMB [10][12].

Core Viewpoint - North Special Technology plans to raise up to 300 million yuan through a simplified procedure for a private placement of A-shares, with the funds allocated for the construction of a planetary roller screw production base in Thailand, seizing opportunities in the humanoid robot development sector [1][2] Company Overview - North Special Technology's main business includes the research, production, and sales of automotive parts, specifically in three segments: chassis components, aluminum alloy lightweighting, and integrated thermal management systems [1] - The company reported a revenue of 2.024 billion yuan and a net profit of 71.44 million yuan for 2024, with year-on-year growth rates of 7.57% and 40.43% respectively. In the first quarter of 2025, revenue and net profit reached 542 million yuan and 23.06 million yuan, reflecting growth rates of 10.73% and 40.31% [1] Industry Insights - The private placement aims to capitalize on the development opportunities of planetary roller screws, expanding product lines and enhancing technological capabilities, while promoting domestic substitution in the manufacturing sector [2][4] - Planetary roller screws are characterized by high transmission efficiency, stability, rapid response, and precision, making them suitable for applications in precision machine tools, aerospace, robotics, and the automotive industry [2] - The production of planetary roller screws involves complex processes such as material heat treatment, straightening, turning, grinding, and flaw detection, which aligns with the company's existing expertise in precision metal components [3] Market Dynamics - The planetary roller screw market is currently dominated by a few international players, with domestic enterprises still in the early stages of industrialization and heavily reliant on imports [4] - The implementation of the fundraising project is expected to accelerate the company's industrialization capabilities in planetary roller screws, breaking the previous monopoly of a few global suppliers and advancing the domestic substitution process [4] - As industrialization progresses, the costs of planetary roller screws are anticipated to decrease, facilitating their application in high-end manufacturing, aerospace, and new energy vehicles, thereby promoting the transformation of the manufacturing sector towards high-end and intelligent solutions [4]

Core Viewpoint - The company reported a decline in revenue and net profit for 2024, with a focus on new projects and international expansion to drive future growth [1][3][4] Financial Performance - In 2024, the company achieved an operating revenue of 2.025 billion, a year-on-year decrease of 3.7%, and a net profit attributable to shareholders of 160 million, down 32.8% [1] - The fourth quarter of 2024 saw an operating revenue of 558 million, a year-on-year decrease of 6.7%, but a quarter-on-quarter increase of 21.3% [1] - For Q1 2025, the operating revenue was 512 million, a year-on-year increase of 1.7%, while the net profit decreased by 14.4% [1] Profitability Metrics - The gross margin for 2024 was 24.4%, down 1.1 percentage points year-on-year, with a further decline to 22.7% in Q4 2024 [2] - The company’s operating cash flow for 2024 was 542 million, a slight decrease of 0.6% year-on-year, but improved significantly in Q1 2025 with a 102.8% increase [2] Business Development - The company launched 45 new projects in 2024, with significant growth in revenue from new energy vehicle products, which increased by 16.9% [3] - The company is accelerating the establishment of its production base in Thailand to mitigate the impact of US-China trade tensions, with production expected to start in June 2025 [3] Strategic Initiatives - A joint venture, Jiangsu Pacific Intelligent Joint Co., Ltd., was established to focus on the R&D and manufacturing of robotic joints and core components, enhancing the company's capabilities in the robotics sector [4] - The company has adjusted its earnings per share (EPS) forecasts for 2025-2027, with projected EPS of 0.47, 0.57, and 0.68 respectively, and a target price of 13.63 [4]