Core Viewpoint - The company reported a strong performance in the first half of 2025, with significant growth in revenue and net profit, driven by steady core business operations and rapid expansion of franchise operations [1][2]. Financial Performance - In H1 2025, the company achieved revenue of 4.91 billion yuan, a year-on-year increase of 8.6%, and a net profit attributable to shareholders of 140 million yuan, up 79.4% year-on-year [1]. - In Q2 2025, revenue reached 2.51 billion yuan, reflecting a year-on-year growth of 7.8%, with net profit of 110 million yuan, an increase of 64.6% year-on-year [1]. - The company's gross margin for H1 2025 was 27.7%, down 2.0 percentage points year-on-year, while the net profit margin improved to 2.9%, up 0.9 percentage points year-on-year [3]. Business Segments - The mother and baby products segment generated revenue of 4.33 billion yuan, growing 9.3% year-on-year, while supplier services contributed 340 million yuan, up 7.4% year-on-year [2]. - The company emphasized store scene upgrades and innovative business models, opening its first Ultra store in June 2025, which integrates trendy elements and AI technology to create a fashionable space for children and teenagers [2]. Cost Management and Profitability - The company optimized its cost structure, with a sales expense ratio of 18.4% in H1 2025, down 2.0 percentage points year-on-year, contributing to improved profitability [3]. - The slight decline in gross margin was primarily due to a decrease in the gross margin of mother and baby products, particularly in the milk powder category [3]. Strategic Initiatives - The acquisition of Siyi Industrial marks a strategic shift towards becoming a comprehensive service provider for new families, with strong synergy potential in membership operations and market layout [3]. - The company is increasing investments in AI, collaborating with Huoshan Engine to develop AI-driven products, including a series of smart emotional companion dolls launched in H1 2025 [3]. Investment Outlook - The company is positioned to provide comprehensive shopping and growth services for infants and pregnant women, with franchise expansion, Siyi Industrial's integration, and AI ecosystem development expected to drive future growth [4]. - Projected net profits for 2025-2027 are estimated at 360 million, 470 million, and 590 million yuan, reflecting year-on-year growth rates of 98.4%, 31.4%, and 23.7% respectively [4].