CCB International has issued a research report stating that SHENZHOU INTL (02313) achieved an 8% year-on-year increase in first-half net profit, slightly above the firm's expected 2% growth. This outperformance was primarily driven by revenue growth and other income exceeding expectations, which was sufficient to offset the impact of margin contraction. Revenue growth was mainly driven by a 7% increase in sales volume and approximately 1% improvement in average selling prices. The firm has raised its target price from HK$69 to HK$70 while maintaining an "outperform" rating. Despite the challenging global macroeconomic environment, the group continues to capture market share from other industry peers. Gross margin contracted by 1.9 percentage points, primarily due to rising wage costs since July last year. Higher government subsidies and net interest income offset the impact of an increased effective tax rate, driving the 8% profit growth.