This report is read as follows:

Under the epidemic, the company's revenue and performance have maintained steady growth, highlighting the advantages of high-quality customer resources and the robustness of core business, the industry is still in a dividend period of penetration, extension of new business is expected to accelerate the development.

Main points of investment:

The performance is in line with expectations and holdings are increased. In 2022-23-24, the EPS was maintained at 0.26, 0.30 and 0.34 yuan, respectively, and the target price was maintained at 7.55 yuan in 2022.

Performance description: the company's 2022H1 earned 6.786 billion yuan / + 24.95% after business, realized net profit of 322 million yuan / + 19.29%, and deducted non-net profit of 254 million yuan / + 11.54%.

Among them, 22Q2 achieved revenue of 3.261 billion / + 21.73% in a single quarter, net profit of 149 million yuan + 6.52%, and non-net profit of 142 million yuan.

Maintain steady revenue growth under pressure, highlighting customer quality advantages and business robustness. ① epidemic control has a relatively obvious impact on the delivery and incremental employment demand of the human resources service industry, but less impact on traditional file management and compensation and benefits; ② foreign service holding accounts for a relatively high proportion of traditional business, and the epidemic does not have much impact on the company's traditional business, which supports the limited slowdown of Q2 revenue growth compared with Q1. The core customers of ③ are mainly the world's top 500 foreign-funded enterprises, head private enterprises, and state-owned enterprises whose proportion is gradually increasing. Under the epidemic situation, the employment demand of high-quality customers is relatively stable, which also supports the robustness of income and performance.

The penetration rate increases the dividend period, the extension power new business accelerates the development. New businesses such as psychics in the ① human service track are in a period of increasing penetration and dividend, hedging some demand fluctuations; the word-of-mouth and high-quality customer resources accumulated by ② over the years are the most important resource endowments and advantages; the advantages of state-owned assets, comprehensive business service capabilities, and strong financial strength will become more obvious in the future. ③ merger and acquisition of Yuanmao and major shareholders are expected to achieve the reuse of resources, capabilities and needs, and accelerate the development of new businesses such as outsourcing and flexible employment.

Risk hint: the local epidemic situation is repeated, the competition in the industry is intensified, and the efficiency is not as good as expected.