Main points of investment

Haofeng Technology is China's leading marketing information solution provider, the company's main business is the contact center and unified communications platform, marketing business and management platform. In 2013, the company had revenue of 247 million yuan and net profit of 51.9 million. The compound growth rate of revenue and net profit in the past three years was 22.7% and 16.7%, respectively. At present, the company's customers are mainly concentrated in Shanghai, Shenyang and Beijing. With the implementation of the fund-raising project, the establishment of the company's marketing network will further open the national market.

China's marketing information industry will enter a period of rapid development, and there is a broad space for industrial growth compared with developed countries. The main results are as follows: 1) the continuous improvement of enterprises' attention to marketing informatization and the intensification of external competition promote enterprises to strengthen the construction of marketing informatization: after the completion of the construction of financial informatization, SCM, ERP and other systems, front-end marketing informatization has become the focus of enterprise informatization construction, while the intensification of external competition also forces enterprises to strengthen marketing informatization construction. 2) compared with the developed countries, there is a large gap in the development of marketing informatization in China, and the current industry standards are gradually taking shape and opening up the incremental space for small and medium-sized enterprises. As an important part of marketing informatization, there is a gap of 5-40 times between China and the world's leading countries in the number of seats in the call center, and there is a large gap in the level of development. at the same time, the demonstration effect of marketing informatization of industry leaders promotes the gradual unification of industry standards, which is expected to open the incremental space of marketing information market for small and medium-sized enterprises.

Own technology + core customers + industry experience to build the company's competitive advantage. 1) independent research and development of products, leading in the technology industry: the company is one of the few companies in the industry that have independent research and development capabilities and can provide a full range of independent intellectual property rights of marketing information solutions provider. 2) the vertical industry has rich experience in project implementation: the company has worked in insurance, banking, manufacturing, government and other industries for many years, and has a deep understanding of the needs of marketing information construction in different industries. And the corresponding marketing information application system is developed according to the business process of the vertical industry. 3) Deep binding of high-quality customer resources: the company has gradually formed a stable and mature customer base through long-term technical services and market promotion, including major banks, insurance companies, manufacturing enterprises and government departments. On the one hand, the benchmarking effect implemented by major customers lays the foundation for horizontal replication of the project, on the other hand, high conversion costs also enable the company to continue to obtain follow-up project upgrading, operation and other income.

Profit forecast and investment advice: considering the changes of the company's future revenue margin and expenses, it is estimated that the company's revenue from 2014 to 2016 will be 3.08,3.81 and 474 million yuan, respectively, an increase of 24.3%, 23.6% and 24.6% over the same period last year. It is estimated that the net profit from 2014 to 2016 will be 0.58,0.64 and 75 million yuan, up 11.4%, 10.4% and 17.4% over the same period last year. Assuming that 10.3 million shares (41.1 million shares of total equity) are issued, the diluted EPS from 2014 to 2016 is 1.41,1.55,1.83 respectively. Based on the company's current competitive advantage in the field of marketing information, it is generally believed that the future of the company is worth looking forward to. With reference to the reasonable valuation range of listed companies in the same industry, the company is given a PE30-40 times in 2015, corresponding to the target price of 46.5-62.0 yuan.

Risk hint: the risk of traditional marketing informatization being replaced by mobile marketing, the risk of declining profitability due to intensified competition in the industry, and the risk of high customer concentration.