Maintain profit forecasts and maintain an “gain” rating. As the 24H1 and 24Q2 company results are in line with expectations, we maintain the company's 24-26 profit forecast. The company's net profit for 24-26 is estimated to be 0.936/1.12/1.301 billion yuan, and the corresponding EPS is 0.88 yuan, 1.05 yuan, and 1.22 yuan, respectively, +27%/20%/16% compared with the same period last year.

The performance was in line with expectations. The company predicts 24H1 revenue of 61.30-6.688 billion yuan, +10-20% year over year; 4.44~0.494 billion yuan, +35-50% year over year; deduction not +5-15%. In 24Q2, the estimated revenue was 35.04 to 4.061 billion yuan, +12 to 30% year on year; 2.36 to 0.285 billion yuan, +41 to 70% year over year, minus -1 to +16%.

The traditional main business is growing steadily, and the goal of the auto zero business remains unchanged. Referring to the industry's online home air production and sales performance, production in the 24M4-5 industry was +16% year-on-year. We expect the company's refrigeration components business revenue to be basically in line with the downstream air conditioning growth situation, and is expected to be around +15% year-on-year in 24Q2. In the auto parts business, on-hand order conversion is still relatively rapid, but due to increased competition in the industry, the growth rate for the first half of the year is expected to be relatively lower than expected, but the company has not changed its target for the whole year. From a long-term perspective, the company acquired Shanghai Dachuang, completed waterway products, and entered hybrid and fuel vehicle OBD tracks to build incremental growth. There is still strong confidence in the development of the auto zero business.

Costs are rising, and phased structural pressure affects profit margins, but the long-term trend is upward. Referring to the revenue and performance forecasting center, the 24Q2 net interest rate level was about 6.9%, down about 1 pct compared to 23Q2 net profit margin. We believe that 24Q2's profit margin pressure is mainly due to a sharp rise in the price of copper, the core raw material. Furthermore, 24H1 refrigeration components are expected to have some growth pressure in the high-profit commercial sector. The NEV thermal management business is also under pressure due to the growth structure dominated by hybrid models with low bicycle value, resulting in pressure on overall profit margins. On a long-term perspective, the company continues to maintain the commercial use and export development of traditional businesses, increase the scale of the high-margin heat exchanger business, and strengthen the integrated supply capacity of thermal management product systems. The upward trend in the company's long-term profitability has not changed.

Risk warning: Weak demand in the home space industry, weakening demand for conduction refrigeration components, and increased competition in the NEV industry leading to lower profit margins for transmission parts companies.