Huawei's core partner gave a “buy” rating
The company is a core partner of Huawei. The independent innovation business surrounding OpenHarmony and OpenEuler is expected to grow rapidly. The company has mature AI full-stack capabilities, and long-term space can be expected. We expect the company's net profit to be 1.8, 330, and 40 billion yuan respectively in 2022-2024, and EPS of 0.23, 0.41, and 0.51 yuan/share, respectively. Corresponding to the current stock price of PE is 127.7, 69.6, and 56.0 times, respectively. It was covered for the first time and gave a “buy” rating.
Hongmeng is leading the way, and performance can be expected
The company is one of the first open source Hongmeng ecosystem enabler partners of Huawei, the first to launch the open source Hongmeng distribution version of HiHopeOS, and is committed to becoming a leader in the open source Hongmeng industry. Take the financial digital service terminal operating system as an example. According to data from the People's Bank of China, the number of online POS machines owned in China in 2022 was about 35.56 million, and there is plenty of room for financial innovation for this product. The company's product is the first financial digital service terminal operating system that has passed both UnionPay certification and financial innovation verification. It has first-mover advantages and product pricing rights, and is expected to usher in a period of rapid release.
Euler leads the way, industry implementation accelerates
As an open source Euler Gold donor, the company fully participated in the major decisions and routine operation of the Open Source Euler project.
In 2020, the company first launched HopeStage, an edge-oriented, cloud-based server operating system based on open source Euler in China. With the decommissioning of CentOS, demand for localization of server operating systems was released at an accelerated pace, and the company's open source Euler business ushered in market opportunities. At present, the company has reached strategic cooperation with leading power and financial customers such as Nanrui Jibao and Hang Seng Electronics. Future project implementation and customer expansion are worth looking forward to.
The company has mature AI full-stack capabilities, and the commercial implementation company that has achieved multiple scenarios now has full-stack technology products from the collection layer, equipment layer, analysis layer to application layer, forming a relatively mature AI full-stack capability. According to the company announcement, the company has accelerated the implementation of AI commercial scenarios. Currently, there are more than 10 products and more than 300 algorithm models officially commercialized in the fields of electricity (transmission, distribution, substation), hazardous chemical manufacturing, road administration, water conservancy, material storage, gas stations, agricultural planting, etc. According to the company's official account, the company launched a next-generation AI hub platform based on a large model and four internal testing products for applications in the electricity, medical, financial, industrial and other industries. An AI white paper is being drafted, which is expected to benefit from the wave of the AI era.
Risk warning: policy implementation falls short of expectations; AI implementation falls short of expectations; company R&D and sales fall short of expectations