Event: the company reported that 21H1 achieved operating income of 2.011 billion yuan, + 36.86% year-on-year; realized net profit belonging to shareholders of listed companies of 94.86 million yuan, + 28.65% year-on-year; deducted non-net profit of 67.6 million yuan, + 24.94% year-on-year.

1. 21H1 analysis: the company issues 21H1 to achieve operating income of 2.011 billion yuan, + 36.86% compared with the same period last year; realize net profit belonging to shareholders of listed companies of 94.86 million yuan, + 28.65% year-on-year; and deduct non-net profit of 67.6 million yuan, + 24.94% year-on-year. Among them, the car business has achieved rapid growth (the car business includes passenger cars, commercial vehicles, engineering vehicles, etc.). 21H1 has a business income of 1.394 billion yuan, + 79.53% compared with the same period last year, mainly due to the acquisition of Yangjing Binbin and watches, as well as full car business orders, and the smooth expansion of new customers. Large and medium-sized bus air conditioners achieved business income of 397 million yuan,-23.62% year-on-year. Nearly 8600 large and medium-sized bus air conditioning system products were delivered during the reporting period, down from 12600 in the same period last year, mainly due to the low prosperity of the industry. As the gross profit margin of small cars is relatively low, 15.72%; the gross profit margin of large and medium-sized buses is relatively high, 28%, so the change in the shipping structure, H1 overall gross profit margin of 20.94%, year-on-year-4.61pct. The company's sales, management, R & D and financial rates are 5.55%, 4.51%, 4.75%, 0.01%, respectively, year-on-year-3.43/-0.31/-0.7/+0.14pct, overall-4.3pct.

2. The car business has expanded smoothly and achieved high-speed growth: from January 1, 2021, Songzhi Ocean has been included in the scope of the consolidated statement. Songzhi Ocean has a high share of condensers in the Volkswagen and Honda systems, and is expected to rely on the Ocean to further expand foreign customers such as Japan and Volkswagen in the future. At the same time, the 21H1 car thermal management business segment received more than 2.5 billion yuan of new orders, including NIO Inc. Automobile, Ford, SAIC GM, BYD, Changan Automobile, Jianghuai Automobile, SAIC GM Wuling and other models of air conditioning box projects, as well as SAIC, Guangzhou Automobile, Honda, Volkswagen and other condenser projects. The profitability of the car hot management business plate during the reporting period has improved significantly compared with the same period last year, which has laid a solid foundation for the follow-up business development.

3. Buses are under pressure from the industry, but the expansion of energy storage business is smooth: during the reporting period, sales of large and medium-sized buses were 39795, an increase of 2.07% over the same period last year, of which the cumulative sales of large and medium-sized new energy buses was 16754, down 5.99% from the same period last year. The overall prosperity of the industry is relatively low. The company shipped 8600 large and medium-sized bus air conditioners, of which pure electric air conditioners accounted for 60%, with a market share of about 31%. The company has further strengthened the research and development and market development of energy storage battery thermal management products, and has become a supplier of energy storage battery thermal management products for customers such as Ningde era and Vision Energy. It is expected to start supplying and turning into sales revenue in 2021.

4. The delivery volume of refrigerated refrigeration units has increased significantly, and new breakthroughs have been made in rail transit business: during the reporting period, the company delivered more than 2500 refrigerated units of various types, an increase of 76% over the same period last year, and sales revenue exceeded 40 million yuan. An increase of 110% over the same period last year. On the other hand, in the rail transit business, we have obtained a number of orders for Hefei subway lines, and further developed the Shanghai subway market, and further expanded the range of downstream customers of thermal management.

Investment suggestion: the company has been committed to automobile thermal management for a long time. It has made great achievements not only in passenger cars and commercial vehicles, but also in passenger cars and cold chain logistics. At this stage, it has newly developed many businesses such as energy storage and rail transit, and is expected to form new growth points in the future. It is estimated that the net profit of 2111 in 22 years is 2.51 and 303 million, while that of PE in 21 years is only 18 times.

Risk hint: customer sales fall short of expectations, market expansion falls short of expectations, and raw materials rise.