Citigroup: Imagination's performance continuously falls short of expectations, Market may ignore risks like price competition under the halo of NVIDIA.

Citibank stated that Engweck's performance has fallen short of expectations for three consecutive quarters, indicating that the market's consistent profit expectations for the company are too high. The market only focuses on its supply of liquid cooling for clients such as Nvidia or specialized integrated circuits, but completely overlooks the risks from small business exposure, intensified domestic price competition, and the pressure from more new entrants in the future. Analysts like Eric Lau pointed out in a report that after inventory growth of 11% in the fourth quarter of last year, inventory in the first quarter grew by 4% year-on-year, indicating that the upcoming second quarter revenue growth will be moderate. Based on valuation factors, the company's target price has been raised from 50 RMB to 60 RMB; a sell rating has been reiterated. Engweck's first-quarter net profit fell by nearly 82% year-on-year; the company's stock price has risen by over 40% this month, with the latest closing price at 121.08 RMB, setting a new historical high.