Investment Rating - The investment rating for China Jushi is "Overweight" [4] - The industry view is considered "Attractive" [4] Core Insights - China Jushi expects its net profit for the first half of 2025 to increase by 72-77% year-on-year, reaching between Rmb1.65 billion and Rmb1.70 billion, with the second quarter net earnings projected to be between Rmb920 million and Rmb970 million, surpassing market expectations of Rmb815 million [1][2] - The increase in earnings is attributed to higher sales volumes for both roving and electronic fabric, which grew by 4% and 6% year-on-year, respectively, alongside price increases of approximately 11% for traditional roving and around 15% for electronic fabric [1][2] Summary by Sections Financial Performance - In 1H25, sales volumes reached 1.59 million tons for roving and 485 million meters for electronic fabric [1] - The company anticipates solid earnings in 2H25 despite potential near-term price pressures due to increased market supply from new capacities and resumed production [2] Market Outlook - The report indicates that strong demand in 1H25 has led to the introduction of new capacities totaling 780,000 tons, which may exert downward pressure on roving prices in the near term [2] - However, the improved product structure and cost performance are expected to mitigate the impact of subdued prices on earnings [2] Valuation Metrics - The price target for China Jushi is set at Rmb14.50, indicating a 19% upside from the current price of Rmb12.17 [4] - The market capitalization is currently Rmb48.72 billion, with an average daily trading value of Rmb312 million [4]