Introduction to this report:

Promote digital business empowerment, networked work models, and collaboration of business work. Actively creating “smart +” products/services, and signed new intelligent business contracts of about 24.47 million yuan. Net profit increased 14%, and operating cash flow increased 184%.

Key points of investment:

Maintain the increase in holdings. The increase in the acceleration of growth predicts that EPS 1.14/1.33 yuan will increase by 20/ 17% in 23-24, and EPS 1.53 yuan will increase 15% in '25. The target price was raised by 15.4 yuan, corresponding to 13.5 times PE in 23 years.

Net profit rose just over expectations by 14%, with on-hand orders of 7.6 billion up 15%. (1) Revenue of 2.8 billion yuan increased 19% in '22 (22Q1-4 increased 17/-8/21/ 41%), net profit of 440 million increased 14% (22Q1-4 increased 12/-5/15/45%), and operating cash flow was 480 million (+184%). Salary expenses are 690 million/320,000 per capita.

(2) 4 billion new contracts signed in '22 (+2%): survey and design fell 8% (56%) from 2.3 billion, project management increased 21% from 200 million, and general engineering contracting increased 18% (39%) from 1.6 billion yuan. (3) Orders in hand increased 15% to 7.6 billion, a guarantee factor of 2.7 billion. (4) The planned revenue for 2023 will increase by 10-40%, and net profit will increase by 10-30%.

Promote digital business empowerment, networked work models, and collaboration of business work. (1) Continue to promote the construction of digital design institutes, focusing on digital empowerment of the main business on the one hand, and expanding and innovating business models and products and services on the other. (2) The innovative work model was networked, and the second phase of the cloud platform, 1,000 cloud desktops and 12 large-scale software computing centers were built and put into use one after another, which basically enabled the headquarters's survey and design business to go to the cloud. (3) Promote collaboration in business work, and use artificial intelligence (AI), the Internet and big data technology to initially achieve full coverage of the knowledge base and collaborative business system in all fields.

Open up the construction, operation and maintenance industry chain, and actively build “smart +” products/services. (1) The company adheres to the “one group, two chains+digitalization+cross-border” business positioning, opening up the two construction, operation and maintenance industry chains of design-centered “engineering investment+consulting+planning+design+construction” and “engineering health monitoring+diagnostic+design+repair” centered on inspection. (2) Build a collaborative work platform based on cloud computing, big data, AI and BIM, and actively build “smart +” products/services. (3) The number of new signings for intelligent business was about 24.47 million yuan.

Risk warning: macroeconomic policies have been tightened beyond expectations, infrastructure investment has fallen short of expectations, etc.