In-depth Impact Analysis of Tianjian Technology (002977) 256 Million Yuan Military Product Price Reduction

According to the company’s announcement, Tianjian Technology signed the Supplementary Agreement on Military Product Price Adjustment with customers due to the 2025 military product price review, resulting in:

• Revenue Reduction
  : Approximately 256 million yuan
• Net Profit Impact
  : Approximately -209 million yuan
• Delisting Risk
  : The 2025 non-recurring profit and loss adjusted net profit is expected to be negative, and the adjusted revenue is below 300 million yuan, which may lead to the implementation of delisting risk warning (*ST) [0]

Based on data analysis, the military product price reduction will have a major impact on the company’s revenue:

Financial Indicator	Before Reduction (Estimated)	Reduction Impact	After Reduction (Estimated)	Change Rate
Revenue	~350 million yuan	-256 million yuan	~94 million yuan	-73.1%
Net Profit	~30 million yuan	-209 million yuan	~-179 million yuan	-696.7%

From a long-term perspective, this means:

• Severe Revenue Shrinkage
  : From the 300-400 million yuan revenue level in previous years to less than 100 million yuan
• Impaired Profitability
  : The company’s 2024 net profit margin was already -21.02% [0], and this reduction will cause the 2025 net profit margin to further deteriorate to approximately -190%
• Declining Industry Competitiveness
  : In the aerospace and defense industry, the significant shrinkage of revenue scale will weaken the company’s market position [0]

According to historical financial data [0]:

• Historical Net Profit Margin Trend
  : Continued decline from approximately 15% in 2021 to -21.02% in 2024
• Negative ROE
  : 2024 ROE was -1.55% [0], indicating a deterioration in shareholder return capacity
• Operating Profit Margin
  : 2024 was -28.70% [0], reflecting continuous losses in core business

The military product price reduction is a

, meaning the pricing benchmark for this product line will be permanently lowered in the future, creating sustained pressure on long-term profitability.

:

• Adequate Liquidity
  : Current ratio 10.96, quick ratio 10.02 [0], indicating extremely strong short-term solvency
• Low Debt Risk
  : Financial analysis shows the debt risk level is “Low Risk” [0]
• Conservative Accounting Policy
  : Adopts a conservative financial attitude with a high depreciation/capital expenditure ratio [0]

:

• Continuous Losses Consume Cash
  : The expected 2025 loss of 209 million yuan will deplete cash reserves
• Investment Contraction
  : Declining profitability will limit R&D investment and capacity expansion

According to the Discounted Cash Flow (DCF) model analysis [0]:

Scenario	Intrinsic Value	Premium Rate vs Current Stock Price	Rating
Conservative Scenario	¥14.71	-66.3%	Severely Overvalued
Base Scenario	¥18.80	-56.9%	Significantly Overvalued
Optimistic Scenario	¥39.23	-10.0%	Mildly Overvalued
Current Stock Price	¥43.59	-	-

:

• Even under the
  Optimistic Scenario
  , the current stock price (43.59 yuan) is still 10% premium over intrinsic value
• Under the Base Scenario, the
  overvaluation幅度 reaches 56.9%
  , meaning there is significant downside risk in valuation
• The probability-weighted intrinsic value is 24.25 yuan, with a 44.4% downside potential compared to the current stock price

Current valuation indicators [0]:

• P/E Ratio
  : -312.82x (Loss-making, meaningless)
• P/B Ratio
  :5.00x (Significantly higher than industry average)
• P/S Ratio
  :65.77x (Extremely high)

:

• A P/S ratio of 65.77x means the market values each 1 yuan of revenue at 65.77 yuan, which is extremely unreasonable given negative profits
• If 2025 revenue drops to 94 million yuan, based on the current P/S ratio valuation, the
  reasonable stock price should fall to approximately 12 yuan
• There is a serious valuation bubble
  , with huge pressure for price adjustment

According to the announcement, the company may touch the following delisting risk warning conditions:

• The lower of the net profit before and after deducting non-recurring gains and losses in the latest fiscal year is negative
• The adjusted revenue in the latest fiscal year is below 300 million yuan

Once *ST is implemented:

• Institutional Investors Exit
  : Public funds, social security funds and other institutions are usually prohibited from investing in *ST stocks
• Financing Capacity Restricted
  : Pledge financing, additional issuance and rights issue and other capital operation channels are restricted
• Liquidity Declines
  : Retail-dominated, stock price volatility intensifies
• Brand Value Damaged
  : Faces difficulties in business cooperation, talent recruitment, etc.

According to technical analysis [0]:

• Current Trend
  : Sideways consolidation, no clear direction
• Support Level
  :41.60 yuan
• Resistance Level
  :44.70 yuan
• Beta Coefficient
  :0.18 (Low volatility)

:

• The stock price fluctuates between 41.60 and 44.70 yuan
• Once it breaks below the 41.60 yuan support level, it may accelerate downward to the 32-35 yuan range
• Recent cumulative gains are large (3 months +28.70%), there is callback pressure

1. One-time Adjustment
   : The price review reduction is a one-time event and does not represent continuous deterioration of profitability
2. Low Debt Risk
   : Debt risk level is low [0]
3. Industry Barriers
   : Aerospace and defense industry has high entry barriers
4. Adequate Liquidity
   : High liquidity ratio provides a buffer to deal with crises

1. Permanent Revenue Shrinkage
   : Price reduction is a structural adjustment, not a temporary fluctuation
2. Severe Overvaluation
   : Current stock price is overvalued by 56.9%-66.3% compared to intrinsic value [0]
3. Delisting Risk
   : *ST will trigger chain negative reactions
4. Industry Cycle Downturn
   : Military industry enters price adjustment cycle, profit margins are under pressure

Time Dimension	Impact Assessment	Key Variables
Within 1 Year	Highly Negative	*ST Risk, Valuation Regression, Stock Price Decline
2-3 Years	Neutral to Negative	Revenue Recovery, New Order Acquisition, Cost Control
Over 3 Years	Depends on Transformation	Product Structure Optimization, Military Product Pricing Reform, Civil Product Expansion

• Delisting risk warning (*ST) will trigger institutional selling
• Severe valuation bubble, with more than 56% downside potential
• Technical support level at 41.60 yuan, once broken will accelerate the decline

• Pay attention to the company’s revenue recovery
• Pay attention to new military product pricing policies
• Pay attention to the progress of civil product business expansion

Risk Category	Risk Level	Explanation
Delisting Risk	⭐⭐⭐⭐⭐	Extremely High, may be implemented *ST in 2025
Profit Risk	⭐⭐⭐⭐	High, expected 2025 loss of 209 million yuan
Valuation Risk	⭐⭐⭐⭐⭐	Extremely High, overvalued by56.9%-66.3% vs intrinsic value [0]
Liquidity Risk	⭐⭐	Low, company has adequate liquidity
Industry Risk	⭐⭐⭐	Medium, military product price reform continues

1. Shareholders
   : It is recommended to reduce positions when rebounding to the 44-45 yuan range to avoid *ST risk
2. Potential Investors
   : It is recommended to wait for the stock price to fall to the 20-25 yuan range (close to intrinsic value) before considering entry
3. Long-term Value Investors
   : Wait for the 2025 annual report disclosure and clear delisting risk before making decisions

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[0] Gilin API Data - Includes Tianjian Technology (002977.SZ) real-time quotes, company overview, financial analysis, DCF valuation, technical analysis and historical price data

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: This report is for investment reference only and does not constitute investment advice. Investment involves risks, please be cautious when entering the market.