Investment Rating - The report maintains a rating of "Accumulate" for the company [4] Core Views - The company has experienced rapid profit growth in the first half of 2025, driven by the expansion of innovative products such as ultrasonic fingerprint sensors and light sensors, which have seen increased commercial scale since their introduction in Q4 2024 [2][3] - The overall gross margin for the first half of 2025 was 43.28%, an increase of 1.23 percentage points year-on-year, while the net profit margin rose by 5.07 percentage points to 19.13% [2] - The company is focused on continuous innovation and has launched several new products, including a new light sensor with glass-plastic hybrid packaging and enhanced NFC solutions, which are expected to drive further growth [3][10] Financial Summary - For 2023A, the company reported revenue of 4,408 million yuan, with a projected revenue of 4,375 million yuan for 2024A, and an expected increase to 5,288 million yuan in 2025E, reflecting a growth rate of 20.9% [1] - The net profit attributable to the parent company is projected to grow significantly from 165 million yuan in 2023A to 604 million yuan in 2024A, and further to 821 million yuan in 2025E, indicating a year-on-year growth rate of 36.1% [1] - The company's earnings per share (EPS) is expected to rise from 0.36 yuan in 2023A to 1.31 yuan in 2024A, and reach 1.78 yuan in 2025E [1] Product Development and Market Position - The company has established long-term partnerships with major global brands across various sectors, including smartphones and automotive electronics, enhancing its market presence [10] - The global smartphone market is showing signs of recovery, with an increase in shipments, which is expected to benefit the company's product lines, particularly in ultrasonic fingerprint sensors [9][10] - The company is actively developing next-generation products to support a wider range of customer models, aiming to capture a larger market share [9][10]

Core Insights - The company reported a slight decline in revenue but a significant increase in net profit, indicating improved profitability and operational efficiency [2] Financial Performance - Revenue for the first half of 2025 was 2.251 billion yuan, a year-on-year decrease of 0.20% - Net profit attributable to shareholders was 431 million yuan, a year-on-year increase of 35.74% - The company's debt-to-asset ratio improved to 13.8% from 15.4% at the end of 2024, indicating a more robust financial structure [2] - Inventory value increased by 10.6% to 630 million yuan, with improved annual inventory turnover rate, reflecting enhanced operational efficiency [2] - Cash reserves are steadily growing, supporting future product development and high-quality operations [2] Product and Technology Development - The company maintained high R&D investment, leading to the launch of innovative products, including the world's first glass-plastic hybrid packaged light sensor, which has been adopted by leading brand clients and is expected to enter mass production in the second half of the year [2] - The enhanced NFC solution supports a wider range of smartphone models for mass production, while the adaptive haptic driver with enhanced algorithms is in the commercial promotion stage, improving user experience [2] Strategic Moves - The company completed the sale of 100% equity in its wholly-owned subsidiaries DCT GmbH and DCT B.V. to Tessolve Engineering Service Pte. Ltd., generating an investment gain of 78 million yuan [3] - This strategic move aims to concentrate resources on core business areas and enhance overall competitiveness [3] - The company plans to continue promoting technological innovation, deepen cooperation with global mainstream clients, accelerate new product commercialization, and improve operational quality for long-term development [3]