Event: on August 25, 2023, the company released its semi-annual report 2023. In the first half of 2023, the company's total operating income was 93 million yuan, down 37.68% from the same period last year; the net profit was 10 million yuan, down 70.44% from the same period last year; and the net profit was 1 million yuan, down 97.23% from the same period last year.

Affected by the pace of project delivery, the performance declined in the first half of the year compared with the same period last year. Due to the lack of major project planning and acceptance nodes, the company's revenue and profits dropped sharply in the second quarter compared with the same period last year. In the second quarter alone, the company realized revenue of 41 million yuan, down 63.39% from the same period last year; and realized net profit of 4 million yuan, down 88.24% from the same period last year. In terms of profitability, the company's gross profit margin in the first half of 2023 was 51.76%, an increase of 3.6 percentage points over the same period last year, indicating the continuous optimization of the company's product structure. On the expense side, the company's sales expenses and R & D expenses in the first half of the year increased by 39.73% and 48.55% respectively compared with the same period last year, indicating that the company is still actively exploring the market and investing in R & D, and the follow-up growth is expected.

With the continuous expansion of product categories, the localization of medical isotope preparation is expected to boost the demand for equipment. In the first half of the year, the company acquired Tianjin Jiazi Robot, added explosion-proof AGV products, and strengthened the accumulation of technology in the robot field. In the field of nuclear technology application, the company focuses on the research and development of chamber intelligent equipment and nuclear chemical intelligent system for medical isotope preparation. The domestic demand for nuclides has accelerated, with the annualized demand for eight commonly used nuclides maintaining a growth rate of 5% and 30%. In this context, the National Atomic Energy Agency jointly issued the medium-and long-term Development Plan of Medical Isotope (2021-2030) in 2021, which requires the improvement of the capacity of localization of medical isotopes. With the increase in categories and the continuous growth of downstream demand for nuclear technology applications, the company's future business growth is still optimistic.

The whole industrial chain of the nuclear industry will be laid out, and capacity planning will be implemented in an orderly manner. In terms of business layout, the company sets up branches or offices for the main bases of the national nuclear industry chain to strengthen customer expansion and service follow-up capabilities. In terms of foreign investment, the company plans to invest in CNNRC in the first half of the year, and is expected to strengthen industrial coordination with the CNNC system in the future. In terms of production capacity, the company's new production capacity in Hangzhou Binjiang and Fuyang Binfu Cooperation Zone is expected to be put into use by the end of 2024, with an additional capacity of about 1.14 billion yuan. At the same time, in the first half of 2023, the company invested in the construction of a high-end nuclear technology and equipment manufacturing base in Haiyan, Zhejiang Province, to further expand the production capacity of nuclear intelligent equipment.

Maintain the "overweight" rating. The company's short-term performance fluctuations do not change the company's core position in the industrial chain, benefiting from the rapid development of nuclear power and the intelligent trend of the nuclear fuel cycle industry, the nuclear industry intelligent equipment market has been improving for a long time. It is estimated that the return net profit of the company from 2023 to 2025 is 166,224 and 300 million yuan respectively, and the corresponding PE is 30. 9, 22. 9 and 17. 9 respectively.

Twice as much. The company is one of the highest targets of "nuclear content" in the share of revenue in the secondary market, with scarcity and continuous growth, and maintains an "overweight" rating.

Risk prompt events: the risk of policy change; the risk of high customer concentration; the risk of performance fluctuations caused by discontinuous acquisition of orders; the risk that the promotion of fund-raising projects is not as expected; the seasonal risk of performance; the risk that the information used in research and reporting is not updated in a timely manner; the risk of deviation in industry scale measurement.