Core Viewpoint - Longping High-Tech (隆平高科) reported a revenue of 2.166 billion yuan for the first half of 2025, with a non-net profit loss of 157 million yuan, marking a year-on-year reduction in losses by 39.13% [1] Group 1: Business Performance - The company achieved stable revenue of 779 million yuan from rice seeds, with a net profit increase of 4% year-on-year [2] - The corn business generated nearly 1 billion yuan in revenue, with the Brazilian corn segment significantly reducing losses by 59.13% [3] - The Brazilian corn business reported revenue of 868 million yuan, a year-on-year increase of 2.11% (14% when adjusted for last year's exchange rate) [3] Group 2: Research and Development - Longping High-Tech invested 280 million yuan in R&D, achieving breakthroughs in breeding technologies for rice, corn, and wheat [4] - The company made significant progress in rice parent creation, with 47.8% of trial combinations being dual-resistant recovery lines [4] - The company registered 11 new corn varieties and 5 sorghum varieties in Brazil, expanding planting areas due to their disease resistance and high yield characteristics [4] Group 3: Management and Financial Health - The company completed a private placement raising 1.2 billion yuan from its major shareholder, significantly reducing interest-bearing liabilities by 726 million yuan [7] - Operating cash flow increased by 52.66% year-on-year, and the asset-liability ratio decreased by 6.46% since the beginning of the year [7] - Financial expenses decreased by approximately 17.33% due to reduced interest-bearing liabilities and favorable loan rates [7] Group 4: Future Outlook - The company plans to capitalize on opportunities in low-cadmium rice varieties and rapid growth of key new varieties to strengthen its leading position in the rice industry [8] - The domestic corn business is expected to enhance its competitive advantage due to the opportunities in the bio-breeding industry [8] - The Brazilian corn segment is anticipated to benefit from the growth of the ethanol industry and diversified demand for Chinese agricultural products, leading to increased seed and grain sales and prices [8]

Core Viewpoint - The rice seed industry is experiencing growth against the trend, with profit performance exceeding expectations; the domestic corn seed industry maintains its leading advantage and demonstrates operational resilience; the overseas corn seed industry may encounter a transformative turning point and is expected to benefit from changes in the international trade landscape, leading to market expansion opportunities [1][3]. Group 1: Rice Seed Industry - The rice seed sector achieved a revenue increase of 13% in 2024, driven by the large-scale promotion of core rice varieties, resulting in a net profit of 340 million yuan, with a growth rate exceeding 50% [1]. - The company reported a total revenue of 8.566 billion yuan in 2024, a year-on-year decrease of 7.13%, and a net profit attributable to shareholders of 114 million yuan, down 43% [1]. Group 2: Corn Seed Industry - The domestic corn seed industry generated revenue of 2.121 billion yuan despite high inventory pressures, showcasing strong operational resilience [1]. - The overseas corn seed business faced challenges due to falling international grain prices and extreme weather, leading to stable sales but a decline in sales revenue to 2.9 billion yuan [1]. - In Q1 2025, the company reported total revenue of 1.4 billion yuan, a year-on-year decline of 32%, and a net profit of -2.09 million yuan, reflecting a significant drop in sales volume due to increased market competition and supply [2]. Group 3: Future Outlook - The domestic hybrid rice seed industry is entering a destocking phase starting in 2024, indicating a potential upward trend in the rice seed market [2]. - The company’s operational capabilities are expected to improve, potentially leading to high-quality profit growth [2]. - The company maintains a strong investment rating, projecting net profits of 432 million yuan, 605 million yuan, and 859 million yuan for 2025 to 2027, with diluted EPS of 0.33, 0.46, and 0.65 yuan respectively [3].