Stock Track | WOER Plummets 6.34% Intraday on Q1 Profit Decline and Margin Squeeze from Raw Material Costs

Stock Track04-28

WOER's stock price plummeted 6.34% during Tuesday's intraday session, a sharp decline triggered by the release of its first-quarter financial results.

The company reported revenue growth of 15.52% year-on-year to approximately RMB 2.032 billion. However, net profit fell 7.63% to RMB 231 million compared to the same period last year. The key concern for investors was a significant compression in profitability, with the comprehensive gross profit margin declining 2.07 percentage points to 30.46%.

Analysts pointed to rising raw material costs for the company's high-margin power high-voltage products as the primary driver for the margin squeeze, as these costs have not yet been passed on to customers. In response to the results and considering continued raw material price volatility, Huatai Securities lowered its gross margin forecast for WOER's power business and revised down its net profit estimates for the coming years.

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