Foryou Industries Co., Ltd.: The current main businesses are automotive electronics and precision die-casting, with no products supplied for humanoid robots.

On February 27, Huayang Group's stock price declined. As of 10:48 on the 27th, Huayang Group fell by 1.77%, trading at 35.5 yuan per share.

An investor asked on the investor interaction platform: Does the company plan to expand into consumer electronics businesses, such as AR glasses? On February 26, Huayang Group responded on the investor interaction platform, stating that its current main businesses are automotive electronics and precision die-casting. The company is paying attention to AR glasses and other businesses.

When asked, "Many automotive parts companies supply products for humanoid robot projects. Does the company supply products for robots?" Huayang Group responded on February 26 on the investor interaction platform, stating that it currently does not supply products for humanoid robots.

On February 21, Huayang Group announced that shareholders Zhongshan Zhongke and Zhongke Baiyun, who hold more than 5% of the company's shares, plan to reduce their holdings by a total of 5.69 million shares, accounting for 1.08% of the company's total share capital, from November 21, 2024, to February 20, 2025.

Huayang Group disclosed on February 20 that it had received institutional surveys and responded to investors' concerns:

1. Progress in market expansion for the company's automotive electronics business?

Huayang Group responded: The customer base for the company's automotive electronics business continues to expand, covering domestic independent automakers, emerging automakers, joint ventures, and international automakers. Since H2 2024, the company's market expansion efforts have yielded significant results, continuously securing project designations from clients such as Chery, Geely, Changan, Seres, Great Wall, BAIC, XPeng, Li Auto, NIO, Stellantis Group, Volkswagen Group, Hyundai-Kia Automotive Group, Changan Ford, and SAIC Audi. The range of supporting products has further diversified, and the number of covered car models has increased.

2. Impact of the launch of the DeepSeek domestic open-source large model on the company?

Huayang Group responded: AI large models will accelerate the development of automotive intelligence and enhance the user driving experience. The company has quickly completed the integration of its self-developed software open platform (AAOP) with the DeepSeek large model interface, accelerating the application of AI large models in intelligent cockpits and intelligent driving, empowering product innovation and enhancing product competitiveness.

3. How does the company maintain the competitive advantage of its HUD products and what is the future growth outlook?

Huayang Group responded: The company places great importance on R&D investment to maintain technological advancement in its products. In 2024, it achieved the mass production of SR-HUD and launched the depth-of-field 3D AR-HUD. Its VPD (Virtual Panoramic Display) product has already secured designated projects, and it is proactively developing applications for technologies such as waveguides and naked-eye 3D. Additionally, the company has strong competitive advantages in intelligent manufacturing and supply chain management, continuously strengthening cost control to provide customers with more competitive products and services. The company's HUD products continue to lead the domestic market in market share. According to statistics from Gasgoo, the company's HUD products accounted for 22.6% of the domestic market in January-December 2024, ranking first. With new projects from clients such as Great Wall, Changan, Geely, Zeekr, Chery, BYD, XPeng, Volkswagen Group, and Stellantis Group entering mass production, the company's HUD products are expected to maintain a high growth trend.

4. Competitive advantages and future mass production scale outlook for the company's cockpit domain controller products?

Huayang Group responded: The company's cockpit domain controller products can provide various solutions customized to client needs, covering multiple chips such as Qualcomm, Renesas, and SemiDrive. Its self-developed software open platform AAOP adopts a layered and modular design approach, enabling flexible and diverse development cooperation models for clients and achieving rapid iteration and adaptation. With new projects from clients such as Changan Deep Blue, Changan Qiyuan, Chery, BAIC, and Changan Ford entering mass production, the mass production scale of the company's cockpit domain controller products is expected to grow rapidly, with platformization and scale advantages becoming increasingly evident.

5. Future development outlook for the company's precision die-casting business?

Huayang Group responded:

The company's precision die-casting business involves precision aluminum, magnesium, and zinc alloy die-casting, precision mold design and manufacturing, and precision injection molding, with products primarily applied to key automotive components. With the rapid development of automotive lightweighting, electrification, intelligence, and AI, since 2024, the company's automotive intelligence-related components, high-speed high-frequency automotive connectors, and optical communication module-related components have grown rapidly. The number of mass production projects for medium and large tonnage die-casting has increased. Since 2024, the company has continuously expanded new orders and capacity, with a positive development trend expected to continue. On February 18, Huayang Group's official account published an article stating that the company's self-developed software open platform has integrated DeepSeek's API interface, and the company's R&D system has preliminarily completed the deployment of DeepSeek, effectively improving R&D efficiency and productivity.

Additionally, on January 22, Huayang Group stated on the investor interaction platform that its cockpit domain controller products can integrate AI-related technologies, with some projects already in application.

Huayang Group has not yet released its full-year 2024 performance results. Its previously released Q3 2024 report showed that revenue for the first three quarters of 2024 was approximately 6.841 billion yuan, up 42.62% YoY; net profit attributable to shareholders of publicly listed firms was approximately 465 million yuan, up 56.2% YoY; and basic earnings per share were 0.89 yuan, up 43.55% YoY.

Huayang Group's Q3 report indicated that the increase in revenue from automotive electronics and precision die-casting businesses contributed to the overall revenue growth. The increase in revenue, along with the effects of scale and improved company management, drove the growth in operating profit.

On November 3, Guosen Securities released a research report, giving Huayang Group an "Outperform" rating. The main reasons for the rating include: 1) The company's net profit margin in Q3 2024 increased by 0.7 percentage points YoY; 2) The company's four expense ratios in Q3 2024 remained stable or decreased; 3) Huayang's deep cooperation with Huawei, with AITO M5 and M7 equipped with Huayang's cockpit products; 4) Focus on automotive intelligence and lightweighting, with continuous product upgrades and optimized customer structure. Risk warnings: raw material price fluctuation risk and downstream production schedule risk caused by chip shortages.