Core Viewpoint - Aojie Technology (688220.SH) reported its 2025 semi-annual results, showing a revenue increase but continued net losses [1] Financial Performance - In the first half of 2025, the company achieved operating revenue of 1.898 billion yuan, a year-on-year increase of 14.67% [1][2] - The net profit attributable to shareholders was -245 million yuan, an improvement from -265 million yuan in the same period last year [1][2] - The non-recurring net profit attributable to shareholders was -352 million yuan, compared to -300 million yuan in the previous year [1][2] - The net cash flow from operating activities was -266 million yuan, an improvement from -394 million yuan year-on-year [1][2] Historical Comparison - In 2024, the company reported operating revenue of 3.386 billion yuan, a year-on-year increase of 30.23% [2][4] - The net profit attributable to shareholders for 2024 was -693 million yuan, worsening from -506 million yuan in the previous year [2][4] - The non-recurring net profit attributable to shareholders for 2024 was -707 million yuan, compared to -658 million yuan in 2023 [2][4] - The net cash flow from operating activities in 2024 was -404 million yuan, an improvement from -678 million yuan in 2023 [2][4] Company Background - Aojie Technology was listed on the Shanghai Stock Exchange's Sci-Tech Innovation Board on January 14, 2022, with an initial stock price of 164.54 yuan per share [4] - The company raised a total of 6.883 billion yuan through its initial public offering, with a net amount of 6.546 billion yuan after expenses [5] - The funds raised are intended for projects related to new communication chip design, smart IPC chip design, and other technological developments [5]

Group 1: Medical Devices Industry - The cardiovascular medical device industry has significant growth potential, with the market for cardiac electrophysiology devices in China expected to grow from CNY 65.80 billion in 2021 to CNY 157.26 billion by 2025, and further to CNY 419.73 billion by 2032 [5][6] - The global market for cardiac rhythm management devices increased from USD 9.7 billion in 2016 to USD 10.6 billion in 2021, with a projected growth to USD 12.8 billion by 2030 [5] - The market for coronary artery disease devices in China is also expanding, with the number of patients expected to reach 31.67 million by 2030, and the market for aortic stent grafts projected to grow significantly [6][7] Group 2: AI Cooling Industry - The AI computing upgrade is driving innovation in cooling technologies, with liquid cooling expected to reduce data center energy consumption by 20%-30%, achieving a PUE below 1.2 [8][9] - The liquid cooling market in China is projected to reach USD 1.26 billion in the first half of 2024, with cold plate solutions currently dominating the market due to their maturity and lower infrastructure modification requirements [9][10] - The market for immersion cooling fluids is expected to grow, with silicone oil and fluorinated liquids being key players, although regulatory challenges may arise [10] Group 3: Semiconductor Industry - Aojie Technology (688220.SH) is a leading player in the baseband chip market, with projected revenues of CNY 45.80 billion, CNY 57.35 billion, and CNY 70.72 billion for 2025, 2026, and 2027 respectively [12][13] - The company has a strong presence in both mobile baseband and IoT sectors, with significant growth expected in its ASIC business, which is anticipated to see multiple-fold growth by 2026 [12][14] Group 4: Pharmaceutical Industry - Lifang Pharmaceutical (003020.SZ) is expected to achieve revenues of CNY 18.53 billion, CNY 22.93 billion, and CNY 27.37 billion from 2025 to 2027, with a strong growth trajectory driven by its unique traditional Chinese medicine products [16][17] - The company is set to launch its first generic version of methylphenidate extended-release tablets in April 2025, targeting a large ADHD market in China [17] Group 5: Beverage Industry - IFBH (6603.HK) is positioned to capture a significant share of the coconut water market in China, which is expected to grow at a CAGR of 55% from 2019 to 2025 [19][20] - The company has established a strong brand presence and is leveraging its supply chain advantages to maintain a competitive edge in the market [20] Group 6: Nonferrous Metals Industry - Zhongmin Resources (002738.SZ) is projected to achieve net profits of CNY 6.03 billion, CNY 12.72 billion, and CNY 22.64 billion from 2025 to 2027, driven by its high-margin cesium and rubidium salt business [22][23] - The company is strategically expanding its copper business, which is expected to provide significant growth potential as demand for copper increases [23][24] Group 7: Aerospace Industry - The commercial aerospace sector is anticipated to reach a turning point with increased satellite launches and the development of reusable rockets, which are critical for the growth of satellite internet [29][30] - Companies like Blue Arrow Aerospace and Tianbing Technology are making significant advancements in rocket technology, with planned launches that could enhance China's capabilities in commercial space [30][31]

Core Insights - The report highlights the significant advantages of ASIC over GPU in terms of cost-effectiveness and energy efficiency, marking a turning point for ASIC development [5][15] - The increasing penetration of AI is driving a surge in inference demand, expanding the market space for ASICs, with projections indicating the global AI ASIC market could reach $125 billion by 2028 [6][15] - The report emphasizes the importance of ASIC design service providers, noting that companies like Broadcom and Marvell hold significant market shares and are crucial for the successful deployment of ASIC technology [6][15] Summary by Sections Computer Industry Deep Dive - ASICs are specialized chips tightly coupled with downstream applications, focusing on specific needs like text and video inference, while GPUs are general-purpose [5][15] - ASICs demonstrate superior energy efficiency, with Google's TPU v5 showing 1.46 times the efficiency of NVIDIA's H200, and Amazon's Trainium2 reducing training costs by 40% compared to GPU solutions [5][15] - The demand for inference capabilities is expected to grow significantly, driven by applications like ChatGPT, which reached 700 million weekly active users by July 2025 [6][15] Market Trends - The report forecasts that the AI ASIC market will see substantial growth, with Broadcom estimating a serviceable market for large clients of $60-90 billion by 2027 [6][15] - Domestic cloud providers are increasingly investing in self-developed ASICs, with companies like Baidu and Alibaba making significant advancements in their chip development [15][16] - The report identifies two core trends in the development of domestic ASICs: PD separation and super nodes, which enhance performance and adaptability to diverse industry needs [15][16] Investment Recommendations - The report suggests focusing on companies with strong self-developed technology platforms in the small nucleic acid drug sector, highlighting firms like Rebio and Hengrui Medicine as potential investment opportunities [17] - It also recommends monitoring the performance of companies involved in the aluminum electronic materials sector, particularly Xinjiang Zhonghe, which is expected to benefit from its integrated supply chain and new alumina projects [18][20] - The report indicates that the data center industry, particularly companies like GDS Holdings, is poised for growth due to increasing demand for AI infrastructure and cloud services [21][23]

Core Insights - The report provides a summary of recommended stocks across various industries for October 2025, highlighting key investment logic for each stock [2]. Industry Summaries Electronics - Aojie Technology (688220.SH) is recommended due to its dual capabilities in connectivity and processing, benefiting from the AI trend in edge computing. The company has a strong presence in 2-5G cellular communication and various mainstream communication protocols [2]. Telecommunications - ZTE Corporation (000063.SZ) is identified as a leading telecommunications equipment provider, poised to benefit from the development of domestic computing power and possesses self-controlled chip capabilities [2]. Power Equipment and New Energy - Goldwind Technology (002202.SZ) is noted for its leadership in wind turbines, with a strategy that enhances profitability and a growing order book. The company is expected to see improved margins due to rising wind turbine bid prices and a recovery in wind farm transfer business [2]. - Sungrow Power Supply (300274.SZ) is highlighted as a leader in photovoltaic inverters and energy storage systems, with significant demand in overseas markets and a focus on integrated solutions for solar power generation and energy storage [2]. Real Estate and Construction - Shenghui Integrated (603163.SH) is recognized for its cleanroom engineering services, with a strong position in the global market outside Taiwan, particularly in potential collaborations with major clients like TSMC [2]. Automotive - XPeng Motors (9868.HK) is projected to increase its revenue significantly over the next few years, with a focus on high-end autonomous driving models and a positive outlook on profitability despite current losses [2]. Metals and Materials - Minmetals Resources (1208.HK) is expected to see a 50% increase in copper production from 2024 to 2029, with significant cost reduction potential from ongoing expansions [2]. Internet - Alibaba Group (9988.HK) is positioned as a full-stack AI service provider, with a focus on enhancing its cloud computing market share and maintaining steady growth in its e-commerce business [2]. Pharmaceuticals - Nanwei Medical (688029.SH) is anticipated to benefit from the domestic medical device procurement reforms and is expected to show strong growth in overseas markets [2]. Food and Beverage - Babbi Foods (605338.SH) is expected to improve its store efficiency through new product offerings and strategic acquisitions, with a positive trend in management confidence reflected in recent executive stock purchases [2].

Core Viewpoint - The company reported a revenue increase driven by strong downstream demand, particularly in the IoT and consumer electronics sectors, while also improving profitability through product high-endization [2][3]. Financial Performance - In the first half of 2025, the company achieved a revenue of 1.898 billion yuan, a year-on-year increase of 14.67%, while the net profit attributable to shareholders was a loss of 245 million yuan, showing a significant reduction in losses [1][2]. - The second quarter of 2025 saw a single-quarter revenue of 988 million yuan, reflecting a year-on-year increase of 19.76% and a quarter-on-quarter increase of 8.59% [1][2]. - The overall gross margin for the company's chip products reached 23.96%, an increase of 4.85 percentage points year-on-year [2]. Market Position and Product Development - The company’s cellular baseband chip business saw a sales volume increase of over 50% and revenue growth of over 30% in the first half of 2025, with a gross profit increase of over 60% [3]. - The company successfully entered new markets such as AI toys, smart wearables, and AI glasses, which are expected to support long-term growth [3]. - The company launched the world's first RedCap+Android smart chip platform, currently in the design-in phase, with expected product launches in Q4 2025 [3]. Custom Business and Future Growth - There has been a significant increase in demand for smart wearables, edge AI, and RISC-V chips, leading to a substantial expansion of the ASIC custom service market [4]. - The company has a full order book for ASIC chip design services, with projects covering both design and mass production for leading clients [4]. - Revenue projections for 2025 to 2027 are estimated at 4.438 billion, 6.316 billion, and 8.443 billion yuan, with corresponding price-to-sales ratios of 10X, 7X, and 5X [4].

Investment Rating - The investment rating for the company is "Buy" and is maintained [7]. Core Views - The company reported a revenue of 1.898 billion yuan for the first half of 2025, representing a year-on-year increase of 14.67%. The net profit attributable to the parent company was a loss of 245 million yuan, which is a significant reduction in loss compared to the previous year. Excluding the impact of share-based payments, the net loss was 161 million yuan, also showing a notable decrease in loss [2][4]. - In Q2 2025, the company's revenue reached 988 million yuan, reflecting a year-on-year growth of 19.76% and a quarter-on-quarter increase of 8.59% [2][4]. - The demand from downstream sectors such as IoT and consumer electronics is strong, driving overall sales upward. The reduction in industry price competition and the ongoing high-end product development are improving the company's profitability. The overall gross margin for chip products reached 23.96%, an increase of 4.85 percentage points year-on-year [9]. Summary by Sections Financial Performance - For the first half of 2025, the company achieved a total revenue of 1.898 billion yuan, with a year-on-year growth of 14.67%. The net loss attributable to the parent company was 245 million yuan, which is a significant improvement compared to the previous year. If excluding share-based payment impacts, the net loss was 161 million yuan, showing a substantial reduction in loss [2][4]. - The second quarter of 2025 saw a revenue of 988 million yuan, marking a year-on-year increase of 19.76% and a quarter-on-quarter increase of 8.59% [2][4]. Market Position and Product Development - The company is enhancing its market position in the cellular baseband product sector, with a sales volume growth exceeding 50% and revenue growth over 30% in the first half of 2025. The gross profit for this segment increased by over 60% [9]. - The company has successfully entered new markets with its products, including AI toys, smart wearables, and AI glasses, which are expected to support long-term growth [9]. - The smartphone SoC business is also expanding, with the first 4G quad-core smartphone chip successfully commercialized and expected to see significant shipment growth in 2025 compared to 2024 [9]. Future Outlook - The company anticipates revenues of 4.438 billion yuan, 6.316 billion yuan, and 8.443 billion yuan for 2025, 2026, and 2027, respectively, with corresponding price-to-sales ratios of 10X, 7X, and 5X [9].

Core Viewpoint - Aojie Technology is one of the few companies covering multi-standard cellular and multi-protocol non-cellular chips, with a strong focus on mobile baseband and IoT sectors, and possesses key self-developed IP reserves [1] Group 1: Business Performance - The 5G mobile chip has been taped out and is expected to continue ramping up in the future [1] - The ASIC segment is projected to experience exponential growth, with expected performance in 2026 being several times higher than in 2024 [1] - In the IoT sector, the baseband chip is used in areas such as vehicle networking and wearables, with a market share of nearly 50% in the Cat.1bis segment for 2024, leading the industry [1] Group 2: Product Development - The shipment volume of Cat.4 is expected to double year-on-year in 2024, while the new generation Cat.7 product has been successfully introduced to clients such as ZTE [1] - In the mobile sector, the 4G octa-core smartphone chip has been successfully introduced to clients in the first half of 2025, and the 5G mobile chip is in the late stages of development, with client introduction expected in the second half of 2026 [1] Group 3: Future Outlook - Continuous product launches and client expansion are anticipated to drive sustained growth in baseband chip revenue [1] - AI ASIC is expected to become a second growth curve for the company, with good order intake for custom chip business, projecting several times growth in revenue by 2026 compared to 2024 [1]

Investment Rating - The report indicates a positive investment outlook for the ASIC industry, highlighting significant growth potential driven by increasing demand for AI applications and specialized chip designs [2]. Core Insights - The report emphasizes the distinct business models of ASIC and GPU, noting that ASICs are specialized chips tightly coupled with specific downstream applications, while GPUs are general-purpose chips [3][10]. - ASICs demonstrate superior cost-effectiveness and efficiency, with notable examples such as Google's TPU v5 achieving 1.46 times the energy efficiency of NVIDIA's H200, and Amazon's Trainium2 reducing training costs by 40% compared to GPU solutions [3][15]. - The report forecasts that the global AI ASIC market could reach $125 billion by 2028, with significant contributions from major players like Broadcom and Marvell [30]. Summary by Sections 1. AI Model Inference Driving ASIC Demand - The global AI chip market is projected to reach $500 billion by 2028-2030, with AI infrastructure spending expected to hit $3-4 trillion by 2030 [8]. - ASICs are recognized for their strong specialization, offering cost and efficiency advantages over GPUs, particularly in AI applications [9][14]. 2. High Complexity of ASIC Design and Value of Service Providers - ASIC design involves complex processes requiring specialized service providers, with Broadcom and Marvell being the leading companies in this space [41][42]. - The report highlights the importance of design service providers in optimizing performance and reducing time-to-market for ASIC products [55][60]. 3. Domestic Developments: Not Just Following Trends - Domestic cloud giants like Alibaba and Baidu have made significant strides in ASIC self-research, establishing independent ecosystems rather than merely following international trends [4][30]. - The report identifies key domestic design service providers such as Chipone, Aojie Technology, and Zhaoxin, which are well-positioned to benefit from the growing demand for ASICs [41]. 4. Key Trends in Domestic ASIC Development - The report identifies PD separation and supernode architectures as two core trends in domestic ASIC development, with companies like Huawei and Haiguang leading the way [4][30]. - These trends reflect a shift towards more flexible and efficient chip designs that cater to diverse industry needs [4]. 5. Valuation of Key Companies - The report includes a valuation table for key companies in the ASIC sector, indicating strong growth prospects and market positioning for firms like Broadcom and Marvell [5].

Investment Rating - The report gives a "Buy" rating for the company [5]. Core Insights - The company is expected to achieve revenues of 45.80 billion, 57.35 billion, and 70.72 billion yuan in 2025, 2026, and 2027 respectively, with corresponding price-to-sales (PS) ratios of 10, 8, and 7 times [5][12]. - The company is one of the few that covers multi-standard cellular and multi-protocol non-cellular chips, focusing on mobile baseband and IoT fields, with significant self-developed IP reserves [5][12]. - The 5G mobile chip has been taped out and is expected to continue ramping up in the future [5][12]. - The ASIC segment is expected to see significant growth, with projected revenue in 2026 being several times higher than in 2024 [5][12]. Summary by Sections Company Overview - The company provides wireless communication and large-scale chip solutions, with products including cellular baseband chips, non-cellular IoT chips, custom chip services, and semiconductor IP licensing [2][29]. - It has established partnerships with major clients such as ZTE, Quectel, Midea, Xiaomi, and OPPO [2][29]. Market Position and Growth - The IoT baseband segment is growing steadily, with the company holding nearly 50% market share in the Cat.1bis segment in 2024, leading the industry [2][12]. - The Cat.4 shipment volume is expected to double year-on-year in 2024, and the new Cat.7 products have been successfully introduced to clients like ZTE [2][12]. - In the mobile sector, the 4G octa-core smartphone chip has been successfully introduced to clients in the first half of 2025, while the 5G mobile chip is in the late stages of development, with client introduction expected in the second half of 2026 [2][12]. ASIC and Custom Chip Services - The company is one of the few domestic chip design firms with a presence on both the "cloud" and "edge" sides, having previously customized large inference and training chips for clients [3][30]. - The ASIC business is expected to see substantial revenue growth, with projections of 8.39 billion, 10.91 billion, and 14.18 billion yuan for 2025, 2026, and 2027 respectively, reflecting year-on-year growth rates of 150%, 30%, and 30% [13][30]. - The custom chip business is expected to have a gross margin of 45%, 46%, and 48% over the same period [13][30]. Financial Projections - The company anticipates revenues of 2.6 billion yuan in 2023, growing to 3.386 billion in 2024, and reaching 4.58 billion, 5.735 billion, and 7.072 billion in 2025, 2026, and 2027 respectively, with corresponding growth rates of 21.5%, 30.2%, 35.3%, 25.2%, and 23.3% [3][12]. - The net profit attributable to shareholders is projected to improve from a loss of 506 million yuan in 2023 to a profit of 175 million yuan in 2027 [3][12]. Valuation and Target Price - The report suggests a target market value of 574.25 billion yuan for 2026, with a target price of 137.28 yuan based on the company's unique position in the domestic baseband communication chip market and its advantages in the ASIC field [18][12].

Core Viewpoint - Aojie Technology's stock performance and financing activities indicate a high level of market interest, with significant trading volume and a notable financing balance, despite a reported net loss in the latest financial period [1][2]. Group 1: Stock Performance - On September 25, Aojie Technology's stock rose by 1.76%, with a trading volume of 1.756 billion yuan [1]. - The financing buy-in amount for Aojie Technology on the same day was 218 million yuan, while the financing repayment was 236 million yuan, resulting in a net financing outflow of 18.42 million yuan [1]. - As of September 25, the total financing and securities lending balance for Aojie Technology was 739 million yuan [1]. Group 2: Financing Activities - The current financing balance of Aojie Technology is 731 million yuan, accounting for 1.84% of its market capitalization, which is above the 90th percentile of the past year [1]. - On September 25, Aojie Technology repaid 2,979 shares in securities lending and sold 5,747 shares, with a selling amount of 632,200 yuan based on the closing price [1]. - The remaining securities lending amount is 73,700 shares, with a balance of 8.1034 million yuan, exceeding the 70th percentile of the past year [1]. Group 3: Financial Performance - For the first half of 2025, Aojie Technology reported a revenue of 1.898 billion yuan, representing a year-on-year growth of 14.67% [2]. - The net profit attributable to the parent company for the same period was -245 million yuan, showing a year-on-year increase of 7.29% in losses [2]. - As of June 30, 2025, the number of shareholders for Aojie Technology increased by 5.28% to 20,800, while the average circulating shares per person decreased by 5.01% to 17,307 shares [2].