Key points of investment

Revenue exploded in the first half of the year, reversing losses year over year:

The company achieved revenue of 876 million yuan in the first half of the year, an increase of about 177.1% over the previous year, of which 786 million yuan was generated in revenue from China, accounting for about 89.7% of the company's total revenue and about 59.0% for the same period last year. The sharp increase in the company's revenue in the first half of the year was mainly due to a sharp increase in revenue from the digital supply chain financial services business. Among them, new cooperation projects carried out in the digital payment and solution business in the first half of this year were the main growth drivers. In addition, trade business revenue from digital retail and payment solutions also increased dramatically, and related orders and production demand clearly recovered in the post-pandemic era.

Domestic cooperation framework agreements have been signed one after another, and strong synergies have helped break the circle:

Since June, the company has announced several cooperation agreements with many well-known companies. The company is continuously recognized by customers through its technical strength and can meet customer needs and provide high-quality solutions. At the same time, we believe that the business model and strategy of achieving growth around the application and implementation of digital yuan technology is effective in a short period of time and has high potential for future development.

Entering the field of overseas auto finance and opening up the market through technology empowerment:

The company and Singapore SEV Holding Pte. Ltd entered into a strategic cooperation framework agreement. The company will provide business promotion and technology development, as well as technology platform business solutions. The parties to the agreement will use their respective advantages in business, technology, resources, etc. to carry out digital technology cooperation in related fields. For the first time, the company opened up overseas market space through technology empowerment.

Multiply the digital yuan to popularize Dongfeng and build a leading fintech enterprise:

We believe that the company is currently the leading digital yuan technology service provider in the insurance industry. Although the current business is still in the incubation stage, the existing business is stable and the development logic is clear. Assuming that the company successfully applies for a digital renminbi smart contract with an insurance company, the revenue scale will grow rapidly over the next three years, and the digital yuan business ceiling is huge. We gave the company a target price of HK$128.6, which is about 10 times PS for FY2025.