Key takeaway

In 1H26, the company recorded revenue of RMB4.564bn, down 62.97% YoY; net profit attributable to shareholders of the parent company was RMB87mn, turning profitable YoY. In 2Q26, the company recorded revenue of RMB2.274bn, down 64.47% YoY; net profit attributable to shareholders of the parent company was RMB23mn, turning profitable YoY. Supported by continued shipment growth following the completion of secure and reliable evaluations for domestic IT application innovation printers, robust overseas demand driven by the Belt and Road Initiative, and the gradual ramp-up of the company’s non-printing chips, we forecast revenue of RMB9.486bn/RMB11.174bn/RMB13.351bn for 2026–2028, representing YoY changes of -42.56%/+17.80%/ +19.48%, respectively; net profit attributable to shareholders of the parent company is forecast at RMB415mn/RMB734mn/RMB1.144bn, up 157.74%/76.89%/55.97% YoY, respectively, corresponding to P/E ratios of 57x/32x/21x. We maintain our “Buy” rating.

Event

In 1H26, the company recorded revenue of RMB4.564bn, down 62.97% YoY; net profit attributable to shareholders of the parent company was RMB87mn, turning profitable YoY; net profit attributable to shareholders of the parent company excluding non-recurring gains and losses was RMB46mn, turning profitable YoY. In 2Q26, the company recorded revenue of RMB2.274bn, down 64.47% YoY; net profit attributable to shareholders of the parent company was RMB23mn, turning profitable YoY; net profit attributable to shareholders of the parent company excluding non-recurring gains and losses was RMB14mn, turning profitable YoY.

Risks

(1) Slower-than-expected adoption of domestic IT brands: The pace of bidding in the domestic IT localization market is heavily influenced by macroeconomic conditions and policy drivers. If progress falls short of expectations, it may negatively affect the company’s operations.(2) Weaker-than-expected downstream demand: If the macroeconomic environment remains weak, demand for printers from both enterprises and individuals may be lower than expected, which could weigh on the company’s revenue.(3) Geopolitical risks: The company’s sales network spans more than 110 countries and regions, and it plans to continue expanding overseas. If international conditions deteriorate further, the company’s overseas business development may be adversely affected. (4) Risk of intellectual property disputes: The general printing consumables industry is technology- and patent-intensive, where patents and technology play a crucial role in gaining competitive advantages. OEMs continuously build technical barriers through patents to protect their market and commercial interests, intensifying pressure on compatible consumables. Patent-related disputes and risks between the company and OEMs are likely to persist over the long term.