Lead Intelligent (300450.SZ) Pre-announced FY25 net income beat; raise TP/EPS; Neutral NEUTRAL Jacqueline Du +852-2978-1783 | jacqueline.du@gs.com Goldman Sachs (Asia) L.L.C. | Key Data _____________________________________ | | | | | | --- | --- | --- | --- | --- | | | | Enterprise value: Rmb99.9bn / $14.3bn | Market cap: Rmb98.9bn / $14.2bn | | | | | | 3m ADTV: Rmb4.5bn / $644.3mn | | | | | | | China | | | | | China Industrial Tech & Machinery | | | | | | | M&A Rank: 3 | | | | | Leases incl. in net debt & ...

Summary of Wuxi Lead Intelligent Equipment Conference Call Company Overview - **Company**: Wuxi Lead Intelligent Equipment (300450.SZ) - **Market Cap**: Rmb92,748 million (approximately US$13,011 million) [2] Industry Context - **Regulatory Change**: On October 9, 2025, China's Ministry of Commerce announced a proposal to control the export of battery, cathode, anode, and manufacturing equipment, requiring exporters to apply for approvals before shipping goods overseas [1] Key Points Impact of Export Control - **Limited Impact on Wuxi Lead**: - Wuxi Lead does not export equipment to sensitive countries or regions, such as the US [1][1] - The majority of Wuxi Lead's overseas projects are for Chinese EV battery makers like CATL and BYD, which are expected to receive government approvals under the new regulation [1][1] - The largest customer in the first four months of 2025 was based in India, representing approximately 19% of total revenue for that period, which should also remain unaffected by the export control [1][1] Financial Outlook - **Target Price**: The 12-month target price for Wuxi Lead is set at Rmb46.0, based on a forward P/E ratio of approximately 39x, reflecting a higher multiple due to an anticipated business cycle turnaround [6][6] - **Expected Share Price Return**: A projected decline of 22.3% from the current price of Rmb59.220 [2][2] - **Expected Total Return**: Estimated at -21.8%, including a dividend yield of 0.5% [2][2] Risks - **Key Risks Identified**: - Worse-than-expected gross profit margin (GPM) [7][7] - Slower overseas project wins [7][7] - Delays in project acceptance, which could weaken operating cash flow [7][7] Additional Insights - **Market Reaction**: Following the announcement of the export control, Wuxi Lead's share price fell by approximately 10% on October 10, 2025 [1][1] - **Management Communication**: Discussions with management indicate confidence in the company's ability to navigate the new regulatory landscape without significant disruption [1][1] This summary encapsulates the critical aspects of the conference call regarding Wuxi Lead Intelligent Equipment, focusing on the implications of regulatory changes, financial projections, and associated risks.