Minsheng Securities: Maintains a "recommended" rating on Hongfa shares, with strong momentum in the development of new product categories.

Minsheng Securities research report points out that Hongfa Co., Ltd.'s net profit attributable to shareholders in the first half of 25H1 was 9.64 billion yuan, an increase of 14.19% year-on-year. Looking at the situation in Q2 alone, the company's net profit attributable to shareholders in Q1 of 25 was 5.53 billion yuan, an increase of 13.25% year-on-year. In terms of profitability, the company achieved a gross profit margin of 34.67% in 25Q2, an increase of 0.03 percentage points year-on-year; and a net profit margin of 16.82%, an increase of 0.01 percentage points year-on-year. In terms of operational efficiency, the company's operational efficiency indicator for 25H1 was 654,000 yuan per capita sales receipt, an increase of 8.9% year-on-year. In terms of research and development, the company completed 462 new product research and development projects with a completion rate of 90%, of which "5+" product development projects accounted for nearly 45%. Product technological innovation and intellectual property layout are advancing in synergy, with 587 patent applications in the first half of 2025, an increase of 10.55% year-on-year. The company is a global leader in relays, with strong momentum in the development of new product categories. The closing price on July 29 corresponds to PEs of 18/15/13x for the years 25-27. The "recommendation" rating is maintained.