This report is read as follows:

Q4 deduction non-profit growth rate decreased month-on-month, expected to be affected by the epidemic, but the annual deduction non-net interest rate still increased significantly, profoundly benefiting from economic recovery and ERP Xinchuang in 2023.

Main points of investment:

"increase holdings". According to the performance forecast and base impact, the EPS from 2022 to 2024 is 0.52 (- 0.13,0.43 (- 0.08,0.63) yuan respectively. Comparable company average PE30 times in 2023, due to the uncertainty of the transition period to give an appropriate discount, maintain the target price of 12.03 yuan, corresponding to 28 times PE in 2023, maintain the "overweight" rating.

Q4 deduction non-profit growth rate declined month-on-month, slightly lower than expected. The company issued an annual performance forecast for 2022, which is expected to deduct the non-return net profit of 0.7 million yuan to 100 million yuan, an increase of 143.31% Murray 161.87% over the same period last year. Q4 deduction non-profit growth rate declined month-on-month, slightly lower than expected.

Q4 expects revenue to grow slightly and profits to be affected. Q4 macro environment changes, affecting the company's original delivery implementation plan, so we judge that the company's Q4 revenue is still growing, but the month-on-month growth rate is expected to be single digits. In the context of declining income growth and rigid staff wages, the company deducted non-profit less than expected, but did not change the pace of recovery. The overall uncertainty in 2022 is much greater than that in 2021, but the company's annual deduction of non-net profit increases from-150 million to 0.7-100 million yuan, deducting non-net interest rate by about 9pct.

ERP Xinchuang continues to promote, the company will benefit. We judge that the ERP replacement of state-owned central enterprises will not be achieved overnight, but adopt a smooth replacement approach of first periphery and then core. The company has experienced three years of reform, and now the revenue of self-developed ERP peripheral products has reached half, and it has highly benefited from ERP Xinchuang. We believe that with the continued decline of systemic uncertainty in 2023, the company's traditional implementation business will return to steady growth, self-developed products will usher in a period of rapid growth, which will lead to the recovery of the company's profitability, and there will be a sustained qualitative leap in deducting non-net interest rates in 2023.

Risk tips: macroeconomic fluctuations, rising labor costs, the promotion of self-owned products is not as expected