Tiangong International (00826), which has steadily embarked on the "specialized, refined, unique, and novel" path of development, has emerged as a representative enterprise against "involution" in the special steel sector. Amidst China's ongoing economic deflation, combating involution has become a key strategy for transitioning the economy from a "price red sea" to a "value blue ocean." By addressing "involutionary" competition, resources can be optimized, industrial capacity utilization improved, favorable conditions created for re-inflation, and efforts can be made to shape a new development framework that promotes high-quality economic growth. Since the concept of "comprehensive rectification of involutionary competition" was first introduced in the 2025 Government Work Report as a key annual task, various sectors have gradually ignited a "counter-involution" trend, and the steel industry has not been an exception, initiating actions against involutionary competition in May of this year. In just a few months, tangible results have emerged in the steel sector, with the PPI index for steel gradually recovering since May, rising to 99.5% by September, an increase of 3.9 percentage points from the same month last year. The immediate success of combating involution in the steel industry can be attributed to enterprises adopting differentiated paths through transformation, upgrading, and high-end development. At the first China Special Steel and New Materials Summit held from October 16 to 17, Wang Wenjin, Executive President of the China Special Steel Enterprises Association, emphasized that pursuing a "specialized, refined, unique, and novel" development path is crucial for the industry to address challenges and seize opportunities, achieving high-quality development. During this summit, the association released a report titled "Interpretation of 'Specialized, Refined, Unique, and Novel' Policies and High-Quality Development of Special Steel New Materials," outlining the direction for the industry to transition towards specialization, refinement, uniqueness, and novelty amidst a complex and changing international situation and domestic industrial upgrades. As a representative enterprise successfully navigating the path of specialization and refinement, Tiangong International was highlighted as a key practice case in this summit. Furthermore, in a special report titled "'Special' Steel for New Heights" aired by CCTV on October 18, Tiangong International's powder steel was prominently discussed, indicating robust commercial development in high-end new materials, receiving recognition from the national broadcaster, and the significant commercial value of its multifaceted commercialization strategy in powder metallurgy is gradually gaining market acknowledgement. According to Zhithong Finance APP, Tiangong International has successfully advanced Chinese powder metallurgy technology from a "catch-up" phase to par with leading global levels while establishing a comprehensive powder metallurgy technology platform. The company has accelerated its multifaceted commercialization of powder metallurgy technology across three dimensions: product upgrades, additive manufacturing raw materials, and the development of "bottleneck" materials. Unlike typical powder metallurgy component manufacturers in the market, Tiangong International originated in cutting tools and has progressively advanced into tool steel production and titanium alloy fields, thereby constructing a complete industry chain from materials to tools. This vertically integrated model enables its powder metallurgy business to produce a strong synergistic effect with downstream tool businesses, facilitating a high-end upgrade of existing product systems and improving profitability levels. For instance, in the domain of industrial mold steel, Tiangong International stands as the only firm in China to mass-produce powder metallurgy tool steel. Since 2020, sales of Tiangong International's powder metallurgy tool steel are projected to increase from 83 tons to 1,500 tons by 2025, yielding a compound annual growth rate of 79.2%, with cumulative sales expected to reach 4,098 tons and an average selling price of about 150,000 yuan per ton, achieving a gross profit margin exceeding 40% and consistently promoting the high-end transformation of industrial mold steel. In the cutting tool sector, Tiangong International has achieved vertical integration, far surpassing its competitors in cost advantages. The company has also extended its powder metallurgy technology to high-speed steel cutting tools, encompassing hard alloy cutting tools as well. In July, Heng'erda signed a cooperation agreement with Tiangong International, committing to procure no less than 100 tons of specialized cutting tool materials annually starting in 2026 over five years, totaling at least 600 tons. This signifies a significant breakthrough for Tiangong International’s powder steel within domestic major clients, setting a precedent for expanding its benchmark effect to attract other new clients. Additionally, the powder metallurgy technology enables a transition from materials to products, with Tiangong International innovating a near-net-shaping process achieving a material yield rate exceeding 80%, significantly conserving precious metal raw materials while enhancing performance by 2-5 times compared to conventional special steel production, which greatly boosts the competitive edge of the company’s products in the market. In terms of additive manufacturing raw materials, powder metallurgy technology serves as the performance foundation, allowing Tiangong International to establish a diversified metal powder platform, comprising high-alloy steel powder, titanium alloy powder, copper alloy powder, and high-temperature alloy powder, applicable to consumer electronics, aerospace, medical devices, liquid cooling, and other thermal management products. At the same time, through its joint venture, Tiangong Titanium Crystal, Tiangong International is strategically entering the burgeoning titanium alloy 3D printing powder market, aiming to capture opportunities in the rapidly growing global 3D printing market (projected to grow from $27.5 billion in 2024 to $150.2 billion by 2032) and to attain domestic replacement of high-end powder materials, filling a current gap, especially as over 70% of domestic 3D printing titanium alloy powders rely on imports. Notably, on October 16, Tiangong International signed a strategic cooperation agreement with Ningbo Saida, aiming to jointly tackle key technologies in new die-casting mold steel powder metallurgy and additive manufacturing to serve domestic and international mainstream automobile manufacturers, further promoting innovation in high-end mold materials and the high-quality development of China's advanced manufacturing industry. This indicates that Tiangong International's commercialization in high-end die-casting mold materials and additive manufacturing is accelerating again. In the development of "bottleneck" materials, Tiangong International focuses on critical materials supporting the nation’s high-end equipment manufacturing and cutting-edge technological development. Through its powder metallurgy technology, the company has entered the humanoid robotics industry by developing high-nitrogen alloy materials, achieving commercialization of high-nitrogen steel. Tiangong International’s self-developed high-nitrogen alloy TPMDC02A was delivered to Jiangsu Runfu Power at the beginning of July for mass production of planetary roller screw rods, positioning Tiangong International as the first company in China to apply high-nitrogen screw rods. Additionally, the company reached an agreement with Heng'erda in July to collaborate on the application of high-nitrogen steel in screw rod manufacturing, signaling accelerated product releases in the humanoid robotics industry with two new high-nitrogen steel clients developed within a month. Tiangong International is also actively positioning itself within the future energy sector by overcoming key structural materials (e.g., advanced low-activation steel) and functional materials (e.g., high-boron steel) preparation techniques for nuclear fusion devices, and has collaborated with national research institutions such as the Southwest Institute of Physics to advance the localization process of nuclear fusion materials. This showcases that Tiangong International is upgrading its existing product matrix through powder metallurgy technology, supporting the high-end development of its products, while also expanding into the 3D printing market with additive manufacturing raw materials and advancing into critical industries such as humanoid robotics and nuclear energy through the development of bottleneck materials. This strategy not only solidifies Tiangong International's leading position in its various product lines but also promotes steady performance growth and creates a diverse new growth curve to further broaden the company's future growth horizon. Importantly, Tiangong International's current development trajectory no longer merely classifies it as a special steel company; it is accelerating its transition towards a high-end advanced materials enterprise. The company’s valuation logic in the secondary market is set to shift from that of a special steel company to a high-end materials company, particularly as the steel industry intensifies its efforts against involution. Tiangong International, which embodies notable features of specialized, refined, unique, and novel development, is expected to witness a high valuation premium. This logic is gradually being recognized by brokerages and the market, with First Shanghai recently releasing a research report indicating that Tiangong International’s industrial mold steel market is stabilizing and recovering, and high-end materials will become a future profit point for the company, retaining a "buy" rating and setting a price target of HKD 4.38 for the next 12 months, suggesting a 55% upside from the closing price on October 17. Furthermore, Tiangong International has experienced three consecutive months of price increases since August, with a positive price trend that exemplifies the accelerated transition of its valuation logic towards high-end materials.