Key takeaway

The company released its 2025 annual report, reporting revenue of 2.399 billion yuan, up 11.83% year-over-year; net profit attributable to shareholders was 467 million yuan, up 16.36% year-over-year; gross profit margin stood at 34.81%, an increase of 3.11 percentage points year-over-year; net profit margin reached 22.52%, up 2.33 percentage points year-over-year. In a single quarter, the company achieved revenue of RMB 733 million in Q4 2025, up 24.46% yearover- year, reaching a record high. Net profit attributable to the parent company was RMB 135 million, up 44.39% year-over-year, also a record high. The gross profit margin was 36.33%, up 6.85 percentage points year-over-year, while the net profit margin was 21.30%, up 4.16 percentage points year-over-year. The company's growth businesses, including intelligent wiper systems, power semiconductors, new energy connection components, and sensors, are flourishing across the board, accounting for over 50% of revenue, with sustained growth expected. At the same time, the company actively embraces the trends in embodied intelligence and the AI industry, leveraging its technical expertise in automotive-grade controllers and encoder products to establish an initial product lineup of rotary joint modules.

Event

The company released its 2025 annual report.

In 2025, the company achieved revenue of 2.399 billion yuan, a yearon- year increase of 11.83%. Net profit attributable to shareholders was 467 million yuan, up 16.36% year-on-year. The gross profit margin stood at 34.81%, an increase of 3.11 percentage points yearon- year, while the net profit margin reached 22.52%, up 2.33 percentage points year-on-year. In a single quarter, the company achieved revenue of RMB 733 million in Q4 2025, up 24.46% yearover- year, reaching a record high. Net profit attributable to the parent company was RMB 135 million, up 44.39% year-over-year, also a record high. The gross profit margin was 36.33%, up 6.85 percentage points year-over-year, while the net profit margin was 21.30%, up 4.16 percentage points year-over-year. The company's cash flow is in excellent condition. As of the end of 2025, the total amount of cash on hand, tradable financial assets, and largedenomination certificates of deposit had reached 2.06 billion yuan.

Quick Take

Growth businesses have surged across the board, with the revenue share of the intelligent power controller business falling below 50%. The company's intelligent wiper system products achieved a revenue of 312 million yuan in 2025, +28.68% YoY, with a gross profit margin of 28.29%, +5.18 pct YoY. Based on the forward development capability of AI models + simulation, the company will achieve a comprehensive upgrade from wiper arms and blades to mechanical and electronic wiper systems, increasing both volume and price. Meanwhile, the next-generation brushless motor wiper system has begun component-level laboratory verification and system-level vehicle verification and optimization. The company's semiconductor power devices achieved a revenue of 269 million yuan in 2025, +50.46% YoY, with a gross profit margin of 36.86%, higher than the company's overall margin. Relying on core advantages such as eliminating cutting stress through "chemical etching" to significantly improve product reliability, the company's global market share is expected to continuously increase. The company's new energy connection components achieved a revenue of 156 mil lion yuan in 2025, +175.33% YoY. The Yuntai Business Division has built a synergistically developing product system of new energy charging guns, high-voltage connectors, energy storage connectors, high-voltage wiring harnesses, and precision injection molding, laying out a dual-wheel drive development pattern of "automotive + low-altitude economy." The drone drive motor busbar project has achieved a designated project from a benchmark OE customer. While maintaining rapid growth in the controller business, the Xinhong Business Division will focus on enhancing the intelligent upgrade and integrated iteration of PCBA modules in 2026, strengthening core hardware integration efficiency to lay the foundation for expanding high-end domain controller-related businesses in the future. Relying on capabilities in ceramic materials, software design, hardware design, and structural design, the sensor business segment is advancing the layout of multi-category gas detection sensors, and the domestic OEM market and overseas aftermarket for nitrogen oxygen sensors continue to be explored. In 2025, the revenue share of the company's founding business—intelligent power controllers—dropped below 50% for the first time. The rapid expansion of future growth businesses is expected to steadily accelerate the company's overall growth.

Actively embrace industry trends such as embodied intelligence and AI . Based on the core methodologies of import substitution, vertical integration, and forward development, the company has expanded its business lines while building diverse capabilities in chip development, precision manufacturing (including molds, injection molding, and stamping), rubber materials, ceramic materials, and simulation. As its core business grows rapidly, the company is proactively embracing emerging industry trends like embodied intelligence and AI. Relying on existing cooperative automotive enterprise customers and leveraging the technical advantages of automotive - grade controllers and encoder products, the company has initially completed the layout of rotary joint module products. Among them, high-precision inductive encoders and high-frequency, high-efficiency gallium nitride (GaN) drivers derived from automotive application scenarios have completed their first version development. The company is accelerating the deep integration of "drive-encoder integration" to improve the integration efficiency and operational stability of core control modules. On the power execution end, the company will collaborate with universities to carry out collaborative research and development of axial flux motors, striving to break through the physical space constraints of joints and promote the ultimate lightweight, miniaturization, and high-efficiency upgrade of core components. On the client side, while continuously deepening cooperation with existing automotive enterprise customers, the company will actively expand resources of embodied intelligence OEMs. In addition, the company's Yuntai Business Unit will leverage its existing capabilities to further explore applications of its "connector" technology in AI infrastructure-related fields, fostering new growth opportunities. Earnings forecast: The company's net profit attributable to shareholders is estimated to be RMB 581 million and RMB 748 million in 2026 and 2027, respectively, maintaining "Buy" rating.

Risks: Macroeconomic fluctuation risk, new product development underperformance risk.

Macroeconomic volatility risk: As a vital industrial pillar of the national economy, the automotive industry is closely tied to economic development. The industry's performance exhibits a strong correlation with macroeconomic fluctuations, and cyclical changes in both global and domestic economies can significantly impact China's automotive production and consumption. As an upstream enterprise in the automotive industry, the company serves as a core component that supports and influences the sector's development, forming a fundamental and vital part of the automotive value chain. The production and sales volume of downstream automotive manufacturers directly impacts the market performance of the company's main products. If the market for the company's main products is adversely affected by macroeconomic fluctuations in the future, it may result in decreased orders, sales challenges, and inventory buildup in the domestic market.

Risk of new product development falling short of expectations: To diversify the company's product portfolio, optimize product structure, and ensure sustained and stable business growth, the company has actively invested in R&D for products including new energy power modules, semiconductor discrete devices, and high-voltage connectors for new energy vehicles. Prior to securing new product orders from customers, the company typically undergoes a development process involving performance analysis, material customization, process design, adjustments, and extensive testing, all of which require substantial development costs. Furthermore, new products must undergo rigorous customer quality certification before mass production, and this certification process is lengthy, multi-stage, and subject to considerable uncertainty. Therefore, due to factors such as R&D capabilities, R&D conditions, and customer certification, there is a risk that the company may fail to complete new product development on schedule or that new products may not pass certification, which could adversely affect the company's operating performance and profitability.