Dongwu Securities: Initiating Coverage on Sanhua Intelligent Controls with Buy Rating

Soo Securities Co., Ltd. Zeng Duohong, Ruan Qiaoyan, and Xu Junhe recently conducted research on Sanhua Intelligent Controls and published a research report titled “2025 Annual Report Review: Automotive & Home Appliances Steady Growth with Quality Improvement and Efficiency Gains, Emerging Industries like Bionic Robots Poised for Launch,” giving Sanhua Intelligent Controls a “Buy” rating.

Sanhua Intelligent Controls (002050)

Investment Highlights

Event: The company released its 2025 annual report. In 2025, revenue was 31.01 billion yuan, up 11% year-over-year; net profit attributable to shareholders was 4.06 billion yuan, up 31%; non-recurring net profit was 3.96 billion yuan, up 27%. In Q4 2025, revenue was 6.98 billion yuan, down 6%/10% quarter-over-quarter; net profit attributable to shareholders was 820 million yuan, up 3%/28%; non-recurring net profit was 880 million yuan, up 1%/19%. The gross profit margin for 2025 was 28.8%, up 1.3 percentage points year-over-year; net profit margin was 13.1%, up 2.0 percentage points. In Q4 2025, gross profit margin was 31.2%, up 4.3/3.1 percentage points; net profit margin was 11.8%, up 1.0/2.1 percentage points. The company recorded a foreign exchange loss of 210 million yuan in 2025 (140 million yuan in Q4). Excluding this impact, performance was in line with forecasts, meeting market expectations.

Traditional refrigeration returns to steady growth, data centers & energy storage contribute incremental growth. In 2025 / Q4, refrigeration revenue was 18.59 / 3.62 billion yuan, up 12% / down 12%; net profit was 2.08 / 0.19 billion yuan, up 31% / down 44%. The gross profit margin for 2025 was 28.8%, up 1.4 percentage points. 1) After the decline of national subsidies in H2 2025, demand softened, especially overseas due to tariffs and localization trends, but the company focused on core customers, steadily increasing market share. 2) In emerging fields, the company advanced data center projects and seized new opportunities. Looking ahead to 2026, we expect the full-year revenue of this segment to grow 10-15% to 20.5-21.5 billion yuan, with net profit increasing 15-20% to 2.3-2.5 billion yuan.

Automotive parts customer structure continues to optimize, optimistic about energy prices rising and core customer improvements driving sector acceleration. In 2025 / Q4, automotive parts revenue was 12.43 / 3.37 billion yuan, up 9% / 3%; net profit was 1.98 / 0.63 billion yuan, up 31% / 38%. The gross profit margin was 28.8%, up 1.2 percentage points. Domestic customers BYD / Geely / Xiaomi / Seres saw sales increase 8% / 38% / 201% / 3% in 2025, offsetting slower growth from overseas key clients. Looking ahead to 2026, rising energy prices will accelerate the penetration of new energy vehicles in Europe and improve overseas key customer sales. We expect full-year revenue to grow 15-20% to 14-15 billion yuan, with further product structure optimization and quality improvements. Net profit is expected to increase 15-25% year-over-year to 2.2-2.5 billion yuan.

Humanoid robot mass production imminent, broad space. Overseas giants are preparing for mass production, with plans to reach 1 million units annually before 2030. The company actively supports product development and maintains a stable supply position. Based on 1 million units shipped, with an actuator assembly price of 50,000 yuan and a net profit margin of 10%, with a 70% market share, this could contribute 3.5 billion yuan in profit.

Significant cost reduction and efficiency improvements, but increased asset impairment losses. The company’s expense ratio was 13.4% / 17.9% in 2025 / Q4, down 0.3 / up 5.0 percentage points year-over-year. In 2025, sales / management / R&D / financial expense ratios were 2.4% / 6.2% / 4.4% / 0.3%, with changes of -0.2 / -0.2 / -0.4 / +0.5 percentage points. We expect expenses to stabilize or decline further. In Q4 2025, fair value change losses were 100 million yuan (vs. 110 million yuan in Q4 2024); asset impairment losses were 60 million yuan (vs. 10 million yuan in Q4 2024).

Profit forecast and investment rating: Considering the impact of reduced national subsidies, we have revised down the net profit attributable to shareholders for 2026-2027 to 4.88 / 6.14 billion yuan (previously 5.09 / 6.79 billion yuan). We expect 2028 net profit to reach 7.66 billion yuan, up 20% / 26% / 25%. Corresponding current P/E ratios are 37x, 29x, and 24x. Given the broad potential of robotics, we maintain a “Buy” rating.

Risk factors: Humanoid robot mass production falls short of expectations; new energy vehicle sales underperform expectations.

Latest profit forecasts are detailed below:

In the past 90 days, 6 institutions have issued ratings for this stock, with 3 “Buy” and 3 “Hold” ratings; the average target price among institutions is 59.5 yuan.

This content is compiled from public information by Securities Star, generated by AI algorithms (Wangxin Calculation Backup 310104345710301240019), and does not constitute investment advice.