Core Viewpoint - He Sheng New Materials (002290.SZ) is expected to achieve a net profit of approximately 137 million to 154 million yuan for the first three quarters of 2025, representing a year-on-year growth of 60% to 80% due to improved supply chain management and increased product gross margins [1][2][3] Financial Performance - The company reported steady growth in its main business of household appliance composite materials, with revenue figures from 2020 to 2024 being 1.822 billion, 2.269 billion, 2.133 billion, 2.34 billion, and 2.526 billion yuan, respectively, and net profits of 55.08 million, 81.98 million, 65.93 million, 82.77 million, and 97.91 million yuan [4] - As of the first half of 2025, the company had a net operating cash flow of 68.05 million yuan and cash on hand of 494 million yuan, a year-on-year increase of 43.3% [4] Stock Performance - The stock price of He Sheng New Materials increased significantly from a low of 14.41 yuan per share in mid-January 2025 to a closing price of 39.13 yuan per share on October 16, 2025, marking a rise of 171% and a total market capitalization of 9.709 billion yuan [1][4] Strategic Initiatives - The company is actively expanding into the AI sector, having established Shanghai Haixi Technology Co., Ltd. in March 2024, focusing on AI-related hardware and software design, development, sales, and operations [5] - In August 2025, the company invested 250 million yuan in Yizhi Electronics, acquiring a 10% stake, which is seen as a strategic move to enhance its presence in the chip and computing power market [6] Research and Development - He Sheng New Materials has been increasing its R&D investment, with expenditures from 2020 to the first half of 2025 totaling 416 million yuan [6] - The company holds 87 patents, including 8 invention patents, and has made significant advancements in PCM/VCM manufacturing processes [6]

Core Viewpoint - He Sheng New Materials Co., Ltd. has shown strong performance in 2023, with a revenue of 2.526 billion yuan and a net profit of approximately 97.91 million yuan, indicating a year-on-year growth of 7.93% and 18.29% respectively, while focusing on intelligent manufacturing and AI collaboration for future growth [1][5]. Group 1: Financial Performance - In 2023, He Sheng New Materials achieved a revenue of 2.526 billion yuan, representing a year-on-year increase of 7.93% [1]. - The net profit attributable to shareholders was approximately 97.91 million yuan, reflecting an 18.29% increase compared to the previous year [1]. - The company expects a net profit of 48 to 53 million yuan for Q1 2025, indicating a projected growth of 72.14% to 90.07% [5]. Group 2: Business Segments - The composite materials for home appliances generated 2.482 billion yuan in revenue, accounting for 98.25% of total revenue, supported by capacity expansion [2]. - The company has established long-term supply relationships with over 120 well-known domestic and international home appliance brands, including Samsung and Midea [2]. - The production capacity is expected to grow by over 10% in 2024 due to the successful launch of a high-end intelligent composite materials production line [2]. Group 3: Research and Development - R&D expenses reached approximately 85.51 million yuan in 2023, marking a 7.49% increase, which supports product innovation and competitiveness [3]. - The company is focusing on high-performance, green, and intelligent product lines to meet diverse customer needs [3]. Group 4: AI Business Development - He Sheng New Materials is developing AI capabilities through its subsidiary, focusing on hardware and software design, and has initiated collaborations in various sectors including government, finance, and healthcare [4]. - The AI business is in the R&D phase, with products aimed at intelligent computing centers and AI integrated machines [4]. Group 5: Market Environment - The macroeconomic environment in China is improving, with favorable policies for real estate and consumer spending, which is expected to benefit the home appliance materials industry [5]. - The company is facing challenges such as intensified competition and raw material price fluctuations, necessitating ongoing optimization of its business structure and increased investment in technological innovation [5][6].