Core Viewpoint - The company has demonstrated rapid revenue growth and improved gross margins in the first half of 2025, with significant advancements in its smartphone product matrix and supply chain reliability, maintaining a "buy" rating [1][2]. Revenue and Profitability - In H1 2025, the company's revenue reached 3.786 billion yuan, representing a year-over-year increase of 54%, with a gross margin of 23.2%, up by 2.0 percentage points. The net profit attributable to shareholders was 397 million yuan, a 165% increase year-over-year [2]. - In Q2 2025, revenue was 2.037 billion yuan, showing a quarter-over-quarter increase of 16% and a year-over-year increase of 26%. The gross margin was 23.5%, up by 0.7 percentage points quarter-over-quarter and 2.4 percentage points year-over-year. The net profit attributable to shareholders was 205 million yuan, increasing by 7% quarter-over-quarter and 51% year-over-year [2]. Smartphone Business Development - The smartphone business generated 1.755 billion yuan in H1 2025, reflecting a year-over-year growth of 40%. The company launched several new 50-megapixel products for high-end flagship and mid-range smartphones, significantly boosting revenue [3]. - The introduction of the domestically sourced 50-megapixel SC595XS product and the 50-megapixel SC532HS product has enhanced the company's product offerings, focusing on performance and cost advantages [3]. - The company also developed the Lofic HDR 2.0 technology, which integrates multiple frames in a single exposure, showcasing innovation in imaging technology [3]. Automotive and Security Business Growth - The automotive business revenue reached 482 million yuan in H1 2025, marking a year-over-year increase of 108%. The smart security segment generated 1.55 billion yuan, up by 59% year-over-year [4]. - The company has deepened collaborations with major automotive manufacturers, leading to increased project coverage and significant growth in new generation products for smart driving applications [4]. - In the smart security sector, the company has launched upgraded products with superior performance, maintaining a leading position in the global market [4]. Valuation - Given the expanding market opportunities in the smartphone sector and the rapid growth in automotive electronics and smart security businesses, the company's EPS estimates for 2025, 2026, and 2027 have been raised to 2.53, 3.68, and 4.91 yuan, respectively. As of August 25, 2025, the company's market capitalization was approximately 41.5 billion yuan, corresponding to PE ratios of 40.8, 28.1, and 21.0 for the respective years [5].

Investment Rating - The report maintains a "Buy" rating for the company [1][5] Core Views - The company has shown rapid revenue growth in Q2 2025, with a significant increase in gross margin and a strong performance in both smartphone and automotive sectors [3][8] - The smartphone product matrix has been further enhanced, and supply chain reliability has improved, contributing to the company's growth [3][8] - The automotive business has experienced a year-on-year revenue increase of 108% in H1 2025, while the security sector continues to solidify its leading position [3][8] Financial Summary - Revenue for 2025 is projected to be RMB 8,883 million, reflecting a growth rate of 48.8% [7] - The company's net profit is expected to reach RMB 1,018 million in 2025, with a growth rate of 159.1% [7] - The estimated EPS for 2025 is RMB 2.53, with a significant upward adjustment of 18.2% from previous estimates [5][7] - The company's market capitalization is approximately RMB 41.49 billion, with corresponding PE ratios of 40.8, 28.1, and 21.0 for 2025, 2026, and 2027 respectively [5][7] Revenue Breakdown - In H1 2025, the company's revenue reached RMB 37.86 billion, a year-on-year increase of 54% [8] - The smartphone business generated RMB 17.55 billion in revenue, up 40% year-on-year [8] - The automotive business revenue was RMB 4.82 billion, reflecting a growth of 108% year-on-year [8] - The security business achieved revenue of RMB 15.50 billion, with a year-on-year increase of 59% [8]