Event description:

Hangzhou Today released its 2011 semi-annual report. The main operating results are as follows: in the first half of 2011, the company realized operating income of 1.435 billion yuan, an increase of 18.16% over the same period last year. The net profit attributed to the parent company was 88 million yuan, an increase of 25.65% over the same period last year. Diluted earnings per share was 0.22 yuan.

The main points are as follows: 1. Revenue in the first half of the year increased by 18.16% compared with the same period last year, and net profit was lower than expected. The gross profit margin of core products declined, and the overall gross profit margin decreased by 1. 62 percentage points compared with the same period last year. Lower expense rates during the first half of the year are difficult to stop the decline in net interest rates, which are expected to pick up slightly in the second half of the year; 4. It is estimated that the operating income of the company in 2011 and 2012 is 2.78 billion and 3.562 billion respectively, and the earnings per share is 0.41 yuan and 0.54 yuan respectively, and the PE corresponding to the closing price on August 15 is 34 and 26 times respectively. Given that weak sales of construction machinery in the second half of the year may lead to a decline in demand for related gearboxes, a "cautious recommendation" rating is given.