Zhuzhou OKE Precision Cutting Tools Co., Ltd. (OKE Precision, 688308) (688308)

Individual Stock Analysis Report | Industry: Cemented Carbide and CNC Cutting Tool Manufacturing | Report Date: September 13, 2026 | Market and technical indicator data as of the close on September 11, 2026; September 13 is a Sunday, and September 11 is the most recent trading day. Some indicators such as moving averages and Bollinger Bands are calculated or estimated independently based on closing data from August 17 to September 11, 2026.

This report is automatically compiled and generated by AI based on public information, for reference only, and does not constitute investment advice.

1. Core Summary

OKE Precision achieved operating revenue of RMB 1.207 billion in the first half of 2026, a year-on-year increase of 99.96%; net profit attributable to shareholders of the parent company was RMB 371 million, a year-on-year increase of 47,734.24%, and non-recurring net profit attributable to shareholders of the parent company was RMB 353 million. The performance growth was mainly driven by increased demand for high-end cutting tools, growth in CNC cutting tool sales volume, product structure upgrading, and product price increases. However, net profit attributable to shareholders of the parent company in the same period last year was only RMB 775,400, reflecting a significant low-base effect, and net cash flow from operating activities during the same period was -RMB 310 million. The quality of converting profit growth into cash flow still needs to be observed.

The company's main business covers CNC cutting tools and cemented carbide products. In 2025, CNC cutting tool revenue accounted for approximately 55.5% of main business revenue, while cemented carbide products accounted for approximately 42.3%. Bars and solid cemented carbide cutting tools grew rapidly, with sales revenue increasing by 55.97% and 93.84% year-on-year respectively in 2025, reflecting the company's extension toward deep processing, high value-added products, and integrated processing solutions. However, the gross margin of CNC cutting tool products has declined from 40.42% in 2023 to 25.44% in 2025, with the overall gross margin at approximately 17%–18%. Capacity ramp-up, depreciation investment, product structure changes, and an increased proportion of externally sourced products continue to constrain profitability.

The company is advancing business and capital operation expansion: it plans to acquire and inject capital into Yongxin Precision to obtain a 51% equity stake for approximately RMB 425 million in self-raised funds, expanding into high-end precision tools such as PCB drill bits; simultaneously, it plans to increase capital and expand shares of a wholly-owned subsidiary and introduce external investors, with a scale of approximately RMB 800 million. As of September 13, 2026, none of the above matters have been completed, and whether they can be successfully delivered, achieve business synergies, and contribute to profitability still depends on subsequent approvals, integration, and operating performance.

As of September 11, 2026, the stock price closed at RMB 83.34, below MA5, MA10, and MA20, with short-term moving averages in a bearish alignment; RSI(6) is approximately 26–27, and the stock price is close to the lower Bollinger Band, suggesting a possibility of technical recovery. However, main capital has been in overall net outflow recently, and trading volume has declined from the previous high-activity phase. The short-term trend remains in a high-volatility correction structure.

2. Company Overview

2.1 Basic Information

2.2 Main Business and Product Layout

• CNC cutting tool products: including CNC inserts, CNC tool bodies, face milling and square shoulder milling tools, solid cemented carbide cutting tools, cermet inserts, PCBN and PCD superhard cutting tools, as well as some hole processing and customized cutting tools.
• Cemented carbide products: including cemented carbide saw blades, cemented carbide bars, cemented carbide discs, and other cemented carbide materials and products. Saw blades are mainly used for cutting materials such as wood, artificial boards, steel, aluminum, and plastics; bars are mainly used as base materials for solid cemented carbide milling cutters, drill bits, reamers, and taps.
• Integrated tool solutions: transforming from a single tool product supplier to a comprehensive cutting solution provider offering "tool products + processing technology services + on-site technical support," with services including tool selection, combination configuration, cutting parameter optimization, on-site trial cutting, tool life tracking, tool management, and processing efficiency improvement.
• Tungsten products and tungsten wire related business: the company is advancing business layout related to the tungsten industry chain such as tungsten wire. In 2025, tungsten product revenue was RMB 10,000,400, a year-on-year decrease of 29.65%, and the tungsten wire project was still in the construction and cultivation stage as of the end of 2025.
• 2025 Product Structure Changes: bar sales revenue was RMB 257,030,800, a year-on-year increase of 55.97%; solid cemented carbide cutting tool sales revenue was RMB 112,059,900, a year-on-year increase of 93.84%, with growth rates higher than the company's overall revenue growth rate, reflecting the company's extension toward deeper processing and higher value-added products.

2.3 Industry Chain Upstream and Downstream Position and Cost-Profit Structure

OKE Precision is located in the mid-to-downstream of the tungsten-based cemented carbide industry chain, connecting upstream materials such as tungsten carbide and cobalt powder with downstream manufacturing customers in automotive, new energy vehicle components, general machinery, molds, aerospace, wind power, rail transit, 3C electronics, and medical devices. The company has extended from cemented carbide materials and standard inserts to bars, solid cutting tools, superhard cutting tools, and processing solutions, positioning itself closer to end customers than traditional material enterprises.

• Main procurement includes tungsten carbide powder, cobalt powder, cemented carbide mixtures, coating-related materials, steel and tool body materials, packaging, and auxiliary production materials.
• Tungsten carbide is the hard phase of cemented carbide, and cobalt powder mainly serves as the binder phase. The company's procurement model is production-based ordering, with tungsten carbide and cobalt powder procurement prices determined on a market-following pricing principle, and procurement strategies adjusted based on orders, inventory, capital conditions, and raw material prices.
• In 2024, direct materials accounted for approximately 85.63% of operating costs for cemented carbide products and approximately 41.44% for CNC cutting tool products. Cemented carbide products are more sensitive to raw material prices; CNC cutting tool products are more influenced by manufacturing processes, coatings, product structure, brand, and application services.
• The company is not an absolute price-setter for tungsten carbide and cobalt powder prices, and on the procurement side it remains overall a price-taker or partial price-taker for bulk raw material prices, though it possesses certain scale procurement and inventory management capabilities.
• In 2024, the top five suppliers' procurement amount was RMB 479,248,800, accounting for 57.80% of total annual procurement; of which related-party procurement amounted to RMB 49,060,700, accounting for 5.92% of total annual procurement. The company has not disclosed the specific names of the top five suppliers or the degree of dependence on any single supplier, and no judgment can be made regarding significant dependence on a single supplier based on this.
• The company is not a tungsten mining resource enterprise and has not disclosed owned tungsten ore reserves or mining resource rights. Its resources and capabilities are mainly reflected in cemented carbide materials and substrate formulations, raw material procurement and inventory management, cutting tool product technology reserves, and application process and customer service experience.
• Downstream customers mainly include automotive and new energy vehicle component processing plants, general machinery and equipment manufacturing enterprises, mold enterprises, aerospace component enterprises, wind power and energy equipment enterprises, rail transit enterprises, 3C electronics and medical device enterprises, as well as cutting tool distributors and regional tool shops.
• The company adopts a coexisting direct sales and distribution model. In 2025, direct sales revenue accounted for approximately 60.0% of main business revenue, and distribution revenue approximately 40.0%, with the importance of direct sales and end-user solution business increasing compared to earlier periods.
• The downstream pricing mechanism in the cutting tool industry is mainly reflected in performance verification, supplier certification, and processing cost comparison, rather than pure product list price competition. Customers focus on tool life, processing efficiency, processing precision, tool change frequency, per-piece processing cost, delivery stability, and on-site technical service capabilities.
• Entering supply chains for customers in automotive, aerospace, rail transit, and other sectors typically requires a relatively long verification period, but customer stickiness is relatively high after certification. The integrated solution business can enhance customer stickiness and order scale, but it includes externally sourced products, resulting in lower gross margins than pure self-produced high-end CNC cutting tool business.
• Customer concentration data: in 2023, the top five customers' sales amount was RMB 174,607,000, accounting for 17.01% of total annual sales. This data is based on the 2023 annual report, and the current minutes were unable to cross-confirm the specific sales proportion of the top five customers in 2024; the specific proportion needs further verification against the original annual report tables.
• The 2024 annual report disclosed that several new customers entered among the top five customers. Based on the minutes information, the company does not have a single customer accounting for more than 50% of sales, and customer concentration risk is generally controllable, but there is insufficient verification of specific customer concentration data for 2024.
• As of December 31, 2024, accounts receivable book value was RMB 389.8 million, accounting for 9.85% of total assets and approximately 34.6% of operating revenue for the year; inventory book value was RMB 631.1 million, accounting for 15.94% of total assets; prepayments were RMB 11,316,600, accounting for 0.29% of total assets; accounts receivable from the top five customers accounted for 21.17% of total accounts receivable. Accounts receivable increased by 7.01% compared to 2023, mainly related to revenue growth and overseas business expansion; inventory increased by 27.70% compared to the end of 2023, related to industrial park production commencement, order delivery stocking, and product structure switching. The relatively high proportion of accounts receivable to revenue indicates that the expansion of direct sales, overseas, and integrated solution businesses has brought certain working capital occupation, and the company is not in a completely strong bargaining position.
• Regarding supplier concentration, the top five suppliers' procurement amount in 2024 accounted for 57.80% of total annual procurement, but the degree of dependence on a single supplier was not disclosed; regarding customer concentration, the top five customers' sales amount in 2023 accounted for 17.01% of total annual sales, sourced from the 2023 annual report, and the specific proportion for 2024 has not been cross-confirmed in the minutes. Overall, the company's supplier procurement concentration is not low, but customers are relatively dispersed, with no single customer accounting for more than 50% of sales.

The company is located in the mid-to-downstream of the tungsten-based cemented carbide industry chain and is a manufacturing enterprise with "material processing capability + cutting tool manufacturing technology + application service capability," rather than an upstream tungsten resource enterprise with mining resources. Current profit margins are affected by bulk raw material prices, capacity ramp-up, depreciation, and product structure. Further improvement mainly depends on increased capacity utilization of CNC cutting tools and solid cutting tools, increased proportion of bars and high value-added cutting tools, advances in substrate and coating technology, transmission of product price increases to raw material price increases, scale effects after industrial park capacity digestion, and upgrading from single tool sales to integrated processing solutions.

3. Financial Data and Valuation Analysis

3.1 Recent Operating Performance

The latest disclosed financial report is the 2026 semi-annual report, disclosed in August 2026. H1 2026 non-recurring net profit attributable to shareholders of the parent company was RMB 353,120,000, compared to -RMB 19,147,200 in the same period last year; basic earnings per share was RMB 2.35, and non-recurring basic earnings per share was RMB 2.24. H1 2026 net cash flow from operating activities was -RMB 310,330,000, compared to -RMB 129,930,000 in the same period last year.

In H1 2026, the company's revenue and profit both grew significantly, mainly driven by product price adjustments following raw material price increases such as tungsten carbide, increased demand for high-end cutting tools, growth in CNC cutting tool sales volume, and product structure upgrading. Profit growth was significantly higher than revenue growth, and non-recurring net profit attributable to shareholders of the parent company still reached RMB 353,120,000, indicating that performance growth was not entirely driven by non-recurring gains and losses. However, net profit attributable to shareholders of the parent company in H1 2025 was only RMB 775,400, reflecting a low-base effect; meanwhile, operating cash flow was negative, and increased inventory and raw material procurement mean that profit quality and cash conversion capability still need to be observed. Full-year 2025 performance recovered significantly compared to 2024, with non-recurring net profit attributable to shareholders of the parent company increasing by 177.12% year-on-year.

3.2 Profit Forecast

According to Hithink RoyalFlush institutional consensus data, as of September 11, 2026, a total of 9 institutions had forecast the company's 2026 performance over the past six months. Institutional forecasts are excerpted from brokerage research reports and are not company performance guidance. Among the main institutional samples, Dongwu Securities, Huaxin Securities, SDIC Securities, Caixin Securities, and CICC have significant differences in their forecasts for 2026–2028 revenue and net profit attributable to shareholders of the parent company; the forecast ranges for 2027 and 2028 are relatively wide, reflecting market divergence on tungsten prices, sustainability of product price increases, progress in the PCB drill bit business, and the ability to maintain profits under a high base.

3.3 Valuation Level and Institutional Ratings

As of September 11, 2026, the company's closing price was RMB 83.34, total share capital approximately 158.78 million shares, corresponding to a total market capitalization of approximately RMB 13.233 billion. Based on net profit attributable to shareholders of the parent company for H2 2025 and H1 2026, the trailing 12-month net profit attributable to shareholders of the parent company is approximately RMB 473.72 million, corresponding to a trailing PE of approximately 27.9x; net assets attributable to shareholders of the parent company at the end of June 2026 were RMB 3,000,990,000, corresponding to a PB of approximately 4.41x. Based on the institutional forecast average, the dynamic PE for 2026–2028 is approximately 22.3x, 19.4x, and 15.2x, respectively. The current stock price has a theoretical upside of approximately 31.3% compared to the institutional target price average of RMB 109.39, and approximately 42.4% compared to SDIC Securities' target price of RMB 118.69; target prices are based on brokerage research assumptions and are not equivalent to market consensus expectations or company performance commitments. The main uncertainties in valuation judgment include: the low-base effect in H1 2026 performance; whether inventory gains from tungsten and tungsten carbide price increases, price increase transmission, and gross margin improvement can be sustained is uncertain; operating cash flow is negative and inventory and raw material capital occupation is increasing; institutions have significant divergence in 2027 profit forecasts; PCB drill bit related M&A and new business are still in the expansion stage, and profit contribution needs to be verified by subsequent financial reports.

4. Recent News and Announcements

4.1 Proposed Acquisition of 51% Equity in Yongxin Precision to Expand PCB Drill Bit and Other Businesses

On August 27, 2026, OKE Precision disclosed a plan to acquire 51% equity in Yichang Yongxin Precision Technology Co., Ltd. through equity transfer and cash capital injection. The company plans to acquire a total of 33.5% equity from Yongxin Precision's original shareholders, with a total transaction consideration of approximately RMB 175 million; simultaneously, it will inject RMB 250 million in cash capital based on a pre-investment valuation of no more than RMB 700 million, obtaining 26.3158% equity after the capital injection. After the transaction is completed, Yongxin Precision will become a controlled subsidiary of OKE Precision and be included in the consolidated financial statements. The total capital investment of the transaction is approximately RMB 425 million, funded by the company's self-raised funds. Yongxin Precision is mainly involved in products such as PCB drill bits, which will help the company extend into the high-end precision tool field. As of September 13, 2026, this matter is still in the stage of shareholder meeting deliberation and advancement, and delivery has not been completed. The company has scheduled the first extraordinary general meeting of shareholders for 2026 to be held on September 14, 2026, and the relevant proposals have not yet received final approval from the shareholders' meeting.

4.2 Wholly-Owned Subsidiary Plans Capital Increase and Share Expansion, Introducing Approximately RMB 800 Million from External Investors

On August 27, 2026, OKE Precision disclosed a plan to conduct a capital increase and share expansion of its wholly-owned subsidiary Zhuzhou OKE Precision Cutting Tools Co., Ltd. and introduce external investors, with a total capital increase scale of approximately RMB 800 million and a pre-investment valuation of approximately RMB 1.2 billion. After the transaction is completed, OKE Precision will still maintain control over the subsidiary. This matter is conducive to supplementing funds for the high-end CNC cutting tool business, promoting independent financing and industrialization expansion of the subsidiary, and providing conditions for subsequent capital operations. External investors will obtain shareholder rights including equity repurchase rights, rights of first refusal, co-sale rights, anti-dilution, and liquidation preference; if the subsidiary fails to advance a qualified IPO application or complete relevant equity roll-up within the agreed period, the investors may have the right to require equity repurchase. As of September 13, 2026, this matter has been submitted to the first extraordinary general meeting of shareholders for 2026 for deliberation, but the shareholders' meeting has not yet been held, and the capital increase and share expansion have not been completed.

4.3 GEM Plans to Continue Selling OKE Precision Shares, Shareholder Structure Faces Further Changes

On August 31, 2026, GEM's board of directors approved a proposal to continue selling its OKE Precision shares, with a planned sale of no more than 7,790,500 shares, approximately 4.91% of OKE Precision's total share capital. GEM had previously sold 8,732,993 OKE Precision shares through a inquiry transfer on June 1, 2026, at a transaction price of RMB 96.45 per share, with a reduction ratio of approximately 5.50%; after the reduction, its shareholding ratio dropped to 4.91%, no longer a shareholder holding more than 5%. If this plan is fully implemented, GEM may essentially exit OKE Precision's shareholder list. This plan may increase market supply and stock price pressure in the short term, but the reason for the reduction is mainly GEM's own asset disposal and capital arrangements, and is not equivalent to a deterioration in OKE Precision's operating fundamentals. As of September 13, 2026, public information only shows the plan to continue selling, and it cannot be confirmed that all 7,790,500 shares have been sold.

4.4 Plans to Cancel 1.25 Million Repurchased Shares and Reduce Registered Capital

On September 5, 2026, OKE Precision disclosed a plan to change 1,250,000 shares in the repurchase special securities account that have not yet been used from the original plan for equity incentives or employee stock ownership plans to cancellation and reduction of registered capital. The shares to be cancelled account for approximately 0.79% of current total share capital, and the cumulative repurchase payment amount was RMB 30,130,265.28; the highest historical repurchase transaction price was RMB 33.50 per share, and the lowest was RMB 16.01 per share. After the cancellation is completed, total share capital is expected to decrease from 158,781,708 shares to 157,531,708 shares, and registered capital is expected to decrease from RMB 158,781,708 to RMB 157,531,708. This matter aims to safeguard shareholder interests, enhance investor return capability, boost investor confidence, and improve long-term investment value, and still needs to be submitted to the second extraordinary general meeting of shareholders for 2026 for deliberation. The company has scheduled this meeting for September 23, 2026, and as of September 13, 2026, the cancellation has not yet been implemented.

4.5 Board of Directors Election Arrangements

On September 5, 2026, OKE Precision disclosed a board of directors election announcement. The company plans to nominate Yuan Meihe, Tan Wenqing, and Zhang Yi as non-independent director candidates, and Zhao Dejun and Zha Guobing as independent director candidates, with Zhao Dejun being an accounting professional. The fourth board of directors is planned to be composed of directors elected by the shareholders' meeting and one employee representative director, with a term of three years. Independent director candidates still need to pass review by the Shanghai Stock Exchange without objection before being submitted to the shareholders' meeting for deliberation. As of September 13, 2026, the election has not been completed, and the current third board of directors continues to perform its duties.

4.6 H1 2026 Performance Grew Significantly, Net Profit Attributable to Parent Approximately RMB 371 Million

On July 17, 2026, OKE Precision voluntarily disclosed a semi-annual performance forecast, expecting net profit attributable to the parent of RMB 360 million to RMB 420 million, and non-recurring net profit attributable to the parent of RMB 350 million to RMB 400 million, compared to RMB 775,400 in the same period last year. On August 26, 2026, the company officially disclosed the 2026 semi-annual report, with net profit attributable to the parent of approximately RMB 371 million, basically confirming the previous performance forecast range. Performance growth was mainly driven by increased demand for high-end cutting tools, growth in CNC cutting tool sales volume, product structure upgrading, product price increases, and the low base in the same period last year. The company also disclosed that in H1 2026, it recognized credit impairment losses of RMB 19,677,000, total asset impairment losses of RMB 4,365,800, and total credit and asset impairment provisions of approximately RMB 24,042,900.

4.7 Participation in Investor Online Collective Reception Day and Semi-Annual Performance Briefing

On September 1, 2026, OKE Precision announced that it would participate in the 2026 Hunan jurisdiction listed company investor online collective reception day and semi-annual performance briefing, with the event time on September 2, 2026. The company will communicate with investors regarding semi-annual performance, raw material prices, the acquisition of Yongxin Precision, and subsidiary capital increase matters. This matter itself does not constitute a change in operations or capital operations.

4.8 Other Corporate Governance and Registered Capital Related Announcements

On September 5, 2026, OKE Precision also disclosed announcements regarding the establishment of a wholly-owned subsidiary, changes in accounting policies, changes in registered capital, and amendments to the articles of association. As of September 13, 2026, no separate material asset restructuring or change of control has been identified from these matters.

4.9 No New Major Regulatory Penalties or Investigations Identified in September 2026

As of September 13, 2026, based on searches of Shanghai Stock Exchange announcements, the STAR Market regulatory inquiry section, and recent company announcements, no new major regulatory penalties, investigations, exchange disciplinary actions, or major inquiry announcements for OKE Precision in September 2026 have been identified. The company was previously involved in information disclosure regulatory inquiry materials related to continuous supervision after the disclosure of its 2025 annual report, but that matter occurred earlier and should not be directly regarded as a new regulatory risk in September 2026.

5. Stock Price Trend and Technical Analysis

5.1 Price Overview

5.2 Technical Indicators

OKE Precision's closing price as of September 11, 2026 was RMB 83.34, below MA5, MA10, and MA20, with short-term moving averages in a bearish alignment, and short-term momentum continued to weaken after the rebound. The stock price is close to the lower Bollinger Band at approximately RMB 78.18, RSI(6) is approximately 26 to 27, and RSI(14) is approximately 41.94, indicating relatively high short-term pressure and a possibility of technical rebound, but not sufficient to confirm a trend reversal. Recent main capital flow has been overall weak, and turnover has declined significantly from late August to early September; meanwhile, institutional holdings disclosures differ across platforms, and the data is lagging, while GEM's planned continued reduction may also increase phased supply pressure.

5.3 Short-Term Trend Outlook (Next Week, Scenario Simulation, for Reference Only)

⚠️ Risk Warning: The following content is only a subjective scenario simulation based on closing data as of September 11, 2026, historical prices, and technical indicators. It does not constitute investment advice, nor is it a single-point price prediction.

① Key Technical Levels

② Next Week Scenarios (Subjective Weights, Not Statistical Probabilities)

• Consolidation (Subjective heuristic weight relatively high, approximately 50%; not a statistical probability): Price range approximately RMB 80–88. RSI(6) is near short-term oversold and the stock price is close to the lower Bollinger Band, suggesting technical repair demand, but MA5, MA10, and MA20 remain in a bearish alignment, main capital has recently been flowing out, and rebound space may be constrained by the RMB 85–88 resistance zone. Trigger conditions include holding the RMB 80–83 area, daily turnover maintained at approximately RMB 400–700 million, no significant volume expansion on declines, and capital flow improving for one to two consecutive trading days.
• Weaker Downside (Subjective heuristic weight moderate, approximately 30%; not a statistical probability): Price range approximately RMB 75–81. If support near RMB 80 fails, and turnover expands with main capital continuing to flow out, the stock price may move toward the lower Bollinger Band at approximately RMB 78 and the previous low of RMB 78. Trigger conditions include the closing price effectively breaking below RMB 80, single-day turnover significantly higher than the recent norm of approximately RMB 500 million, main capital continuing with relatively large net outflows, or the STAR Market and mechanical equipment sector weakening in tandem.
• Rebound and Strengthening (Subjective heuristic weight relatively low, approximately 20%; not a statistical probability): Price range approximately RMB 86–93. It would need to first recover MA5 near RMB 85.4, then break above MA10 near RMB 87.8, and with significantly increased turnover, the previous dense trading area of RMB 90–93 could then be observed. Trigger conditions include the closing price重新 standing above RMB 85.4–87.8, single-day turnover continuously reaching approximately RMB 800 million or higher, main capital shifting from consecutive outflows to consecutive net inflows, and PCB, cutting tool, or high-end manufacturing related sectors strengthening in tandem.

③ Capital and Liquidity Background

As of September 11, 2026, the turnover rate was 3.83%, and turnover was approximately RMB 501 million; in recent trading days, the turnover rate was roughly 2.92%–5.01%. From August 27 to September 1, there was a high-turnover phase of 7.26%–10.41%, with turnover of approximately RMB 1.174–1.625 billion, which subsequently fell back to the approximately RMB 400–600 million range, indicating that there is still some trading activity, but volume has clearly contracted from the previous high-activity phase. Regarding shareholder structure, institutional holdings disclosures as of June 30, 2026 differ across platforms, and a single top ten shareholder concentration figure cannot be confirmed; the data is approximately two and a half months stale as of September 11, and GEM disclosed on August 31, 2026 a plan to continue selling no more than 4.91% of shares, so the actual chip structure may have changed. Therefore, current liquidity data can be used to observe recent trading activity, but cannot be used to precisely judge the latest chip concentration level or institutional holding direction.

A verifiable volume confirmation signal is: if subsequent single-day turnover continuously reaches approximately RMB 800 million or more, while the stock price closes above the RMB 85.4–87.8 resistance zone, this can be regarded as an observation signal of improved short-term capital participation; if turnover expands but the stock price still closes below RMB 80, it more likely represents selling pressure release rather than effective capital entry.

④ Key Points to Watch (Observation Ideas Only, Not Trading Instructions)

• Observation idea, not a trading instruction: Watch whether the RMB 80.3–83.3 area can form short-term support.
• Observation idea, not a trading instruction: Watch whether the RMB 78–80 strong support zone is effectively broken below on a closing basis.
• Observation idea, not a trading instruction: Watch whether the RMB 85.4–87.8 resistance zone can be recovered with increased volume.
• Observation idea, not a trading instruction: Watch whether turnover can continuously reach approximately RMB 800 million or more, and whether main capital shifts from net outflow to consecutive net inflow.

The above scenario simulation is based on closing data as of September 11, 2026, historical prices, and technical indicator calculations. Short-term stock prices will also be affected by multiple factors such as news, capital flows, and the broader market environment. Technical indicators themselves have lag and limitations, do not constitute a guarantee of future actual trends, and do not constitute buy or sell recommendations. Please combine with the latest market information to make independent judgments and bear investment risks yourself.

6. Industry Landscape and Competitor Analysis

6.1 Industry Status

The company belongs to the cemented carbide cutting tool and CNC cutting tool industry. CNC cutting tools are key consumables for CNC machine tools, and the industry is characterized by being technology-intensive, having long manufacturing processes, multiple quality control points, relatively long customer certification cycles, and products possessing consumable attributes. Demand is related to manufacturing equipment utilization rates, machine tool CNC penetration levels, and processing complexity.

6.2 Competitive Landscape

• The company's 2025 annual report cited industry data stating that the Chinese cutting tool industry market size was approximately RMB 49.2 billion in 2023; in 2024, cutting tool customs import value was RMB 8.525 billion, a year-on-year decrease of 2.66%. The above data belongs to industry statistical scope and is not equivalent to the size of the single CNC insert sub-industry, nor does it directly represent OKE Precision's addressable market space.
• From 2015 to 2022, China's imported cutting tool share declined from 37.20% to approximately 27.20%, reflecting the continuous advancement of the domestic substitution trend.
• Industry competition dimensions include substrate material formulation and performance, coating technology, insert grades and groove design, product consistency and life, high-end difficult-to-machine material processing capability, customer on-site application services, distribution networks, overseas channels, and large-scale production and raw material procurement capabilities.
• The competition model is shifting from pure low-price product competition to comprehensive competition of "tool performance + processing efficiency + integrated solutions." When tungsten prices and tungsten carbide prices rise, enterprises that can absorb costs through price increases, inventory management, material technology, and product upgrading have relatively more obvious competitive advantages.
• The domestic market was long dominated by European, American, Japanese, and Korean enterprises in the mid-to-high-end segment, with major international brands including Sandvik, Kennametal, Iscar, Mitsubishi Materials, Sumitomo Electric, and Kyocera.
• Domestic enterprises are advancing import substitution by expanding CNC insert capacity, improving substrate and coating technology, entering supply chains in automotive and aerospace sectors, expanding solid cutting tools and superhard cutting tools, building application engineer and end-user service teams, and improving overseas channel capabilities.
• Industry concentration is still lower than in mature international markets, but leading enterprises, with advantages in capital, technology, brand, customer certification, and scale, show a trend of increasing concentration.
• OKE Precision's historical investor communication has disclosed that CNC inserts and other CNC cutting tools have a combined capacity of approximately 130 million pieces and possess approximately 20% flexible capacity space; this data is not the official capacity table in the latest annual report and cannot be simply equated with actual effective capacity at the end of 2025.
• As of 2025, the company's CNC cutting tool product output was 89,532,700 pieces/units, sales volume was 106,670,300 pieces/units, and inventory was 20,724,000 pieces/units; sales volume exceeding output was mainly related to digesting prior inventory.

6.3 Major Competitors

Compared to Huarui Precision, OKE Precision has a broader product structure, covering cemented carbide products, bars, solid cutting tools, tool bodies, superhard cutting tools, and integrated solutions; compared to China Tungsten and Hightech Materials and Xiamen Tungsten, the company does not have tungsten ore resources or large comprehensive industry chain advantages, but its cutting tool business is more focused and its manufacturing organization is relatively flexible; compared to Worldia and Hengfeng Tools, the company leans more toward standardized, serialized cemented carbide cutting tools and material synergies, rather than superhard materials or high-end non-standard customization. Its competitiveness mainly depends on material formulations, coating and cutting tool structure technology, large-scale manufacturing, customer certification, end-user application services, and increased proportion of high value-added products.

7. Risk Warnings

• Low-Base Effect Risk: H1 2026 net profit attributable to the parent grew significantly year-on-year, but the same period in 2025 had net profit attributable to the parent of only RMB 775,400. The current high growth rate has an obvious base factor, and subsequent profit growth rates may decline.
• Tungsten Price and Price Increase Sustainability Risk: H1 2026 performance was driven by product price adjustments following raw material price increases such as tungsten carbide. Whether the related price transmission, inventory gains, and gross margin improvement can continue is uncertain; the company is not a tungsten mining resource enterprise and lacks absolute control over upstream resource prices.
• Cash Flow and Working Capital Risk: H1 2026 net cash flow from operating activities was -RMB 310 million; as of the end of 2024, accounts receivable book value was RMB 389.8 million and inventory was RMB 631.1 million, with inventory increasing by 27.70% year-on-year. If receivables collection or inventory turnover falls short of expectations, it may increase capital occupation and impairment pressure.
• Gross Margin Decline Risk: The company's CNC cutting tool product gross margin declined from 40.42% in 2023 to 25.44% in 2025. New capacity ramp-up, increased depreciation and labor manufacturing expenses, and the relatively high proportion of externally sourced products in integrated solutions may continue to suppress overall profitability.
• M&A Integration Risk: The company plans to acquire 51% equity in Yongxin Precision for approximately RMB 425 million in self-raised funds, but as of September 13, 2026, shareholder meeting deliberation and delivery have not been completed; whether the PCB drill bit business can subsequently achieve synergies and reach expected profit contribution remains uncertain.
• Subsidiary Financing and Repurchase Obligation Risk: The company plans to increase capital and expand shares of a wholly-owned subsidiary and introduce approximately RMB 800 million from external investors. Investors enjoy repurchase rights, anti-dilution, and liquidation preference rights; if a qualified IPO application or equity roll-up cannot be advanced as agreed, related repurchase arrangements may be triggered.
• Supplier Concentration Risk: In 2024, the top five suppliers' procurement amount accounted for 57.80% of total annual procurement. The company has not disclosed the degree of dependence on a single supplier. If major suppliers' supply, prices, or settlement terms change, it may affect raw material security and cost control.
• Shareholder Reduction and Stock Price Volatility Risk: GEM disclosed a plan to continue selling no more than 7,790,500 shares, approximately 4.91% of total share capital. If the plan is implemented, it may increase phased market supply; meanwhile, the company's stock price has retraced approximately 60.6% from the 52-week high, short-term moving averages are in a bearish alignment, and net capital outflows and declining volume may amplify price volatility.

8. Conclusion and Outlook

The core logic of the company's performance improvement lies in the volume growth of high-end CNC cutting tools, increased proportion of bars and solid cutting tools, product price increases, and price transmission brought about by changes in tungsten-based material prices. Compared to single-insert enterprises, the company has a broader product structure and is upgrading toward integrated solutions through cutting tool products, processing technology services, and on-site technical support. If new capacity utilization increases, industrial park capacity is smoothly digested, and high value-added products continue to grow, profit margins and scale effects still have room for improvement.

Future growth may also come from high-end precision tool businesses such as PCB drill bits and subsidiary financing expansion, but the related transactions are still in the deliberation or advancement stage, and potential business contributions cannot be equated with already realized operating results. The institutional forecast average for 2026 net profit attributable to the parent is approximately RMB 594 million, but the forecast ranges for 2027 and 2028 are relatively wide, reflecting significant market divergence on tungsten prices, price increase sustainability, inventory gains, and new business profitability.

The company's current valuation and stock price performance are affected by both high performance growth and sustainability uncertainty. H1 2026 performance has a low-base effect, operating cash flow is negative, and inventory and raw material capital occupation is increasing; on the technical side, attention should be paid to whether the RMB 80–83 area and the support near RMB 78–80 can hold. If a subsequent rebound occurs, the RMB 85.4–87.8 resistance zone and volume changes can serve as observation indicators. The above factors should be comprehensively evaluated in conjunction with subsequent financial reports, transaction progress, and cash flow performance.

Data Sources

• OKE Precision (688308)_Company Announcements_OKE Precision: 2026 Semi-Annual Report Sina Finance_Sina.com
• OKE Precision (688308)_Company Announcements_OKE Precision: 2025 Annual Report Summary Sina Finance_Sina.com
• OKE Precision (688308) Profit Forecast_F10_Hithink RoyalFlush Financial Services Network
• H3_AP202607171827060108_1 | PDF
• Huaxin Securities-OKE Precision (688308) Company Dynamic Research Report: Volume and Price Rise Together, Performance Improving, Landscape Reshaping, Leader Setting Sail-260510.pdf
• OKE Precision (688308.SH) Company Flash Report: Performance High Growth Year-on-Year, AI PCB Second Curve Accelerating - SDIC Securities | Discover Report
• OKE Precision (688308) Profit Forecast_F10_Hithink RoyalFlush Financial Services Network
• OKE Precision (688308): Q1 Performance Impressive, 2026 Benefits from Tungsten Price with Sufficient Performance Elasticity__Sina Finance_Sina.com
• Institutional Rating | Dongwu Securities Gives OKE Precision "Overweight" Rating, No Target Price Given
• OKE Precision (688308) PE Ratio | Valuation | Fundamentals - Lixinger
• Minsheng Securities Co., Ltd. Regarding
• OKE Precision (688308)_Company Announcements_OKE Precision: 2026 First Extraordinary General Meeting Materials Sina Finance_Sina.com
• OKE Precision Discloses Subsidiary Capital Increase and Share Expansion Plan: Total Contribution of RMB 800 Million to Introduce Industrial Machine Tool Industry Investment Fund, Pre-Investment Valuation Reaches RMB 1.2 Billion_Sina Finance_Sina.com
• Company Announcements_OKE Precision: Shareholder Inquiry Transfer Result Report and Announcement on Equity Change Prompting Shareholding Ratio of Shareholders Holding More Than 5% Dropping Below 5% Sina Finance_Sina.com
• OKE Precision (688308)_Company Announcements_OKE Precision: Announcement on Changing the Purpose of Repurchased Shares and Cancellation and Reduction of Registered Capital Sina Finance_Sina.com
• OKE Precision (688308)_Company Announcements_OKE Precision: Announcement on the Election of the Board of Directors Sina Finance_Sina.com
• OKE Precision (688308)_Company Announcements_OKE Precision: Voluntary Disclosure Announcement of 2026 Semi-Annual Performance Forecast Sina Finance_Sina.com
• OKE Precision (688308)_Company Announcements_OKE Precision: Announcement on the 2026 Hunan Jurisdiction Listed Company Investor Online Collective Reception Day and Semi-Annual Performance Briefing Sina Finance_Sina.com
• OKE Precision (688308)_Major Event Reminders and News Announcements_Investment Reminders_Sina Finance_Sina.com
• Regulatory Inquiries | Shanghai Stock Exchange
• OKE Precision (688308)_Stock Quotes, Quotes Homepage_CFI.cn
• OKE Precision (688308) - Historical Trading Data | Dabanke.com
• OKE Precision (688308) Individual Stock Analysis_Niucha Zhengu_Hithink RoyalFlush Finance
• 688308 | OKE Precision Cutting Tools Co Ltd Stock - Investing.com
• OKE Precision (688308) Stock Information - Data Platform
• OKE Precision (688308) Individual Stock Analysis_Niucha Zhengu_Hithink RoyalFlush Finance

This report is automatically retrieved, compiled, and generated by AI based on public channel information. Information is as of Market and technical indicator data as of the close on September 11, 2026; September 13 is a Sunday, and September 11 is the most recent trading day. Some indicators such as moving averages and Bollinger Bands are calculated or estimated independently based on closing data from August 17 to September 11, 2026., and there may be timeliness differences. Specific data should be based on the company's official announcements and authoritative data terminals. This report is only for information compilation and research reference, does not constitute any investment advice, and investors should make independent judgments and bear investment risks themselves.