Core Viewpoint - The company reported strong financial performance for 1H25, with significant revenue and profit growth driven by increased delivery of next-generation products and service business expansion [1] Financial Performance - The company achieved revenue of $594 million in 1H25, representing a year-over-year increase of 24.90% [1] - Net profit reached $64.97 million, up 82.45% year-over-year, significantly exceeding expectations [1] - The gross margin and net margin improved by 1.8 percentage points and 3.4 percentage points, reaching 36.2% and 10.9% respectively [1] Business Segments - Aircraft manufacturing revenue was $498 million in 1H25, a year-over-year increase of 25.2%, accounting for 83.8% of total revenue [1] - Service revenue was $96 million, up 24.1% year-over-year, making up 16.2% of total revenue [1] - The company delivered 350 aircraft in 1H25, a 22% increase year-over-year, including 305 SR2X series aircraft and 43 Vision Jets [1] Order Backlog and Production Capacity - As of June 30, 2025, the company had a backlog of 1,056 orders, including 827 SR2X series and 229 Vision Jets, sufficient to sustain production for approximately 1.5 years [1] - The company plans to invest $13 million to expand the Grand Forks manufacturing facility from 165,000 to 195,000 square feet to meet strong downstream demand [2] Product Pricing and Upgrades - The average delivery price for SR2X increased from $1.04 million to $1.14 million, a 9.6% year-over-year rise, while the Vision Jet price rose from $3.33 million to $3.48 million, a 4.5% increase [1] - The introduction of the new SR Series G7+ product, featuring advanced safety and automation features, is expected to further enhance pricing power [1] Market Position and Outlook - The company has sold products to customers in 55 countries and established authorized service centers in 32 countries, enhancing ecosystem stickiness [2] - The company is positioned as a leading player in the global private jet market, with strong growth prospects supported by a robust order backlog and stable profitability [2] Earnings Forecast and Valuation - The net profit forecasts for 2025 and 2026 have been raised by 8.8% and 11.1% to $151 million and $177 million respectively [2] - The current stock price corresponds to a P/E ratio of 16.5x for 2025 and 14.0x for 2026, with a target price increase of 48.5% to HKD 63.85, indicating a potential upside of 21% [2]

Investment Rating - The industry investment rating is "Recommended," indicating an expected increase in the industry index exceeding the benchmark index by more than 5% in the next 3-6 months [48]. Core Insights - The report highlights the significant growth potential in the low-altitude economy, particularly in the eVTOL (electric Vertical Take-Off and Landing) sector, driven by favorable government policies and increasing market interest [4][10]. - JOBY has reached a market capitalization milestone of $10 billion, reflecting a 50% increase in value over the past month, showcasing strong investor confidence in the eVTOL market [5][19]. - The report emphasizes the competitive landscape, noting that Chinese companies are positioned to lead in the eVTOL sector globally, with both the U.S. and China recognizing the strategic importance of the low-altitude economy [18][19]. Industry Overview - The report provides key industry data, including a total market capitalization of approximately 33,326.88 billion RMB and a circulating market capitalization of about 28,543.14 billion RMB [3]. - The performance of the transportation sector has shown a 13.2% increase over the past 12 months, with a 6.5% increase over the last six months [3]. Company Analysis - The report discusses the business model of the company, which operates in high-end manufacturing and high-end consumer goods, focusing on the private aircraft sector. The company has increased prices significantly, with the SR2X series and Vision Jet prices rising by 26% and 24% respectively from 2021 to 2024 [2][20]. - Comparatively, the report notes that the company’s valuation is lower than its international peers, with expected net profits of 11.5 billion, 13.3 billion, and 15.4 billion RMB for 2025-2027, respectively [2][20]. Market Performance - The report indicates that the Huachuang Transportation Low Altitude 60 Index has increased by 8% year-to-date, outperforming the Shanghai and Shenzhen 300 Index, which has risen by 2% [22][24]. - Notable stock performances include a 14% increase in the stock price of the company, with a year-to-date increase of 140% as of July 11 [19][26]. Investment Recommendations - The report suggests focusing on key segments within the low-altitude economy, including manufacturers, supply chains, new infrastructure, and operational applications [30][32]. - Specific companies highlighted for investment include Wan Feng Ao Wei, Xi Rui, and Yong Li, which are expected to benefit from the growth in the low-altitude economy [33][34].