Incident: On April 20, Guangting Information held the “Super Software Factory White Paper” press conference.

The company's expansion performance in '22 is under pressure, and they are optimistic about the smart cockpit business layout. In 2022, the company achieved operating income of 530 million yuan, +22.70% compared with the previous year, and achieved net profit of 32 million yuan to the mother, which was -56.56% year on year. Reasons for business growth: 1) The development of new energy vehicles in 2022 exceeded expectations, with a market share of more than 25%. The acceleration of new energy vehicles ushered in an inflection point in the market and entered a period of rapid growth; 2) The company maintained the company's steady and continuous growth through continuous cultivation of leading customers and collaborative innovation with large customer clusters. 3) Continuously increase R&D investment and innovation efforts, pioneer a super software factory, and focus on building a two-level R&D innovation system to continuously enhance our R&D innovation strength and market competitiveness. The main reason for the decline in profits was due to factors such as the increase in the number of personnel due to the increase in business scale, the rise in unit labor costs, and the sharp increase in R&D investment and the implementation of equity incentive plans to increase share payments.

The Kotei Super Software Factory creates a new model for intelligent automotive software development with human-robot collaboration. In the era of software-defined automobiles, traditional automobiles dominated by mechanical hardware are evolving into intelligent mobile terminals dominated by software, driven by data, and integrating software and hardware, and showing digitalization, informatization, and intelligence. The traditional automotive software development model is no longer sufficient to meet the many new demands and challenges of software development in the era of intelligent automobiles, such as rapid responsiveness, continuous delivery capability, and cost of software development. In this context, Guangting Information first proposed the “Super Software Factory” in 2021 and set up the Super Software Factory Laboratory. On the basis of studying the Industrialization 4.0 system, it absorbed the “human-machine-material ring” mindset of quality management and explored ways to implement intelligent automotive software engineering.

Keep up with the AI wave and use AI to improve delivery efficiency. The company uses data mining and AI deep learning technology to build an intelligent production platform for software development, increase the reuse rate of software code, build a development environment with cloud-based online collaboration, dynamic iterative upgrades, and efficient data circulation, create an intelligent, refined and visual software development model, and solve the problems faced by automotive software development such as lack of industrial talent, high quality requirements, and short delivery cycles.

Investment advice: We expect the company's net profit to be 100, 155, and 225 million yuan respectively in 23-25. We are optimistic about the long-term logic of intelligent driving and software-defined vehicles, and maintain the company's “buy” rating.

Risk warning: business demand falls short of expectations; product technology development falls short of expectations.