Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected price increase of over 15% in the next 6-12 months [5][36][42]. Core Insights - The company reported a revenue of 2.41 billion RMB for H1 2025, a slight decrease of 0.8% year-on-year, and a net profit attributable to shareholders of 312 million RMB, down 25.7% year-on-year. However, Q2 2025 showed a revenue increase of 6.1% year-on-year and a significant sequential growth of 65.3% [3][15][16]. - The company is experiencing a recovery in Q2, with net profit growth outpacing revenue growth, suggesting potential for high growth in the future [3][4]. - The gross margin for H1 2025 was 44.7%, down 6.1 percentage points year-on-year, while the net margin was 12.9%, down 4.3 percentage points year-on-year. In Q2 2025, the gross margin improved to 46.0%, with a net margin of 16.9%, indicating a positive trend in profitability [3][19]. Performance Analysis - The company faced downward price pressure from downstream sectors, which affected overall revenue. The increase in low-value-added products also contributed to the revenue decline [16]. - The company has shown significant improvement in Q2, with a net profit increase of 333.2% quarter-on-quarter, indicating a recovery trend [3][15]. - The company has actively increased inventory and contract liabilities, suggesting strong order support for future growth. As of Q2 2025, contract liabilities were 36.31 million RMB, up 19.23% from Q1 2025, and inventory reached 2.469 billion RMB, up 3.33% from Q1 2025 [4][28]. Technological Advancements - The company has made several technological breakthroughs, including the development of high-pressure radiation-resistant MOSFET products and advancements in key technologies for marine applications. These innovations are expected to enhance the company's competitive position in emerging sectors [4][24]. Profit Forecast and Valuation - The company is projected to achieve net profits of 1.1 billion RMB, 1.41 billion RMB, and 1.7 billion RMB for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 13.1%, 28.2%, and 20.5%. The corresponding price-to-earnings ratios are estimated to be 25.6, 20.0, and 16.6 [5][36].