Open Source Securities: Issue a Buy rating for Sanhuan Group

Open Source Securities Co., Ltd. Chen Rongfang, Zhang Weizhen, and Liu Qi recently conducted research on Sanhuan Group and released a research report titled “Company Information Update Report: 2025 Performance Steady, MLCC Core Business and SOFC New Business Move Forward in Coordination,” giving Sanhuan Group a “Buy” rating.

Sanhuan Group (300408)

Full-year revenue and profit both increase; core businesses such as MLCC and optical communications work together to drive results; maintain a “Buy” rating. The company released its 2025 annual report. (1) In 2025, the company achieved revenue of RMB 9.01B, up +22.13% year over year; net profit attributable to shareholders of RMB 2.62B, up +19.54% YoY; net profit attributable to shareholders after deducting non-recurring items of RMB 2.25B, up +16.39% YoY; gross margin of sales was 42.14%, down -0.85 pcts YoY; net profit margin of sales was 29.05%, down -0.64 pcts YoY. (2) In the fourth quarter, the company achieved revenue of RMB 2.5B, up +25.30% YoY, and +5.90% quarter over quarter; net profit attributable to shareholders of RMB 660 million, up +12.38% YoY and -8.53% QoQ; net profit attributable to shareholders after deducting non-recurring items of RMB 543 million, up +9.57% YoY and -15.22% QoQ; gross margin was 41.22%, down -2.35 pcts YoY and -2.17 pcts QoQ; net profit margin was 26.37%, down -3.04 pcts YoY and -4.18 pcts QoQ. (3) We believe the company’s MLCC core business is currently solid; benefiting from the growth in future demand for automotive electronics and the acceleration of AI compute infrastructure, the company’s MLCC and optical communication device business are expected to further expand in volume. Meanwhile, the company’s SOFC business R&D is accelerating and moving toward implementation, jointly building a multi-tier growth framework for the company. Therefore, we maintain the company’s 2026/2027 earnings forecasts, add an 2028 earnings forecast, and expect the company’s net profit attributable to shareholders for 2026/2027/2028 to be RMB 3.507/4.512/5.48B. Based on the current stock price, the PE is 28.9/22.5/18.5x, and we maintain the “Buy” rating.

MLCC product matrix is improved; ceramic insertion core production and sales lead globally; a dual-wheel drive fuels growth

在 the MLCC segment, the company’s products cover micro-small, high-capacitance, high-voltage, high-frequency, and automotive-grade series. It has successfully developed products such as M3L and the “S” series, and achieved full-spec mass production for 01005-2220. In the data center segment, the company has already launched multi-size, multi-spec high-capacitance products; in the automotive electronics segment, automotive-grade product specifications cover 0201-2220, with capacitance values ranging from 0.1pF to 47μF, and it is gradually being introduced into core systems of new energy vehicles. In optical communications, the company’s products are widely used in data centers, and it has released new products such as the MT insertion core + guide pin combination, and optical chip packaging ceramic tube housings. Benefiting from the acceleration of global compute infrastructure buildout and the expansion of demand for optical devices, sales revenue of related products has grown steadily, and the production volume and sales volume of the core ceramic insertion core products remain among the global leaders.

SOFC R&D accelerates toward implementation; H-share listing continues to be advanced; globalization opens up growth space

The company is actively promoting the demonstration application of megawatt-class large-power solid oxide fuel cell (SOFC) systems. Through technical breakthroughs, it achieves efficient, long-life system development and expands the company’s market space in the new energy field. At the same time, in 2025 the company applied to list on the Main Board of the Hong Kong Stock Exchange (H shares), aiming to broaden overseas financing channels and deepen its global strategy deployment. This fundraising will focus on overseas capacity expansion, technology iteration, and automation construction, helping overseas projects to land and strengthening core competitiveness.

Risk warning: macro policy risk; risk of weak end-market demand; risk that new business expansion may not meet expectations.

Latest earnings forecast breakdown is as follows:

Within the most recent 90 days, a total of 4 institutions have provided ratings for this stock, and all 4 have given a “Buy” rating.

The above content has been compiled by Securities Star from publicly available information and generated by an AI algorithm (Cybersecurity Record No. 310104345710301240019). It does not constitute investment advice.