Sankeshu Projects 119 Percent Profit Growth in H1 2025 as Retail Drives Expansion

Sankeshu (603737.SH), China’s largest domestic coatings company, announced a projected net profit of 3.80–4.60 billion RMB for the first half of 2025, marking a year-on-year increase of 80.94% to 119.04%. Additionally, its deducted net profit is expected to reach 2.30–3.10 billion RMB, soaring 190.04% to 290.92% compared to the same period last year.

The profit surge is attributed to three key factors:

1. Optimized product structure aligned with market demand boosted retail business and gross margin.
2. Cost control improvements through precise measures to enhance spending efficiency.
3. A decline in impairment provisions, reducing financial strain.

Founded in 2002, Sankeshu has established itself as a leader in architectural coatings, waterproof materials, and industrial paints, supported by 13 production bases and over 20 subsidiaries. Despite a slight 2.97% revenue decline in 2024 to 12.105 billion RMB, the company’s net profit grew 91.27% to 3.32 billion RMB, reflecting its focus on high-value products and retail innovation.

In Q1 2025, Sankeshu’s revenue reached 2.1304 billion RMB, up 3.12% year-on-year, with net profit rising 123.33% to 1.052 billion RMB. Notably, its retail segment recorded significant growth, driven by artistic coatings and faux stone finishes, which cater to market upgrades and rural expansion efforts.

Sankeshu has also developed a nationwide network of nearly 140,000 retail outlets, including 1,700 "Mazhuzhu" community renovation stores, whose Q1 2025 sales doubled from the previous year. The company’s dual-package model continues to gain traction in engineering markets, offsetting challenges in the real estate sector by focusing on industrial factories, municipal projects, and commercial renovations.

Looking ahead, Sankeshu remains committed to sustainable growth by advancing its retail transformation, enhancing channels in urban and rural areas, and promoting its industrial coatings as a second growth driver. The company aims to meet consumer demand for better living spaces while navigating macroeconomic uncertainties in 2025.