Overview of events:

On September 25, Shengshi Science and Technology issued a "suggestive announcement on the bid-winning candidates for the customs information construction project in Beijing Zhongguancun Comprehensive Free Trade Zone". The consortium with Shengshi Science and Technology as the leader was the first bid-winning candidate, with a bid price of 113.6829 million yuan.

Recently, Shengshi Science and Technology participated in the bidding for the customs information construction project of Beijing Zhongguancun Comprehensive Free Trade Zone. China's tendering and bidding public service platform announced the winning candidates of the above projects. The consortium with Shengshi Science and Technology as the leader was the first winning candidate, with a bid price of 113.6829 million yuan and a delivery time of 157days. According to the Chinese government website, Beijing Customs will take the opportunity of promoting the action of "Zhiguan Power" and the construction of intelligent customs, fully rely on the policy advantages of the comprehensive insurance area, adhere to integrity and innovation, and use science and technology to empower. We will promote the Zhongguancun Comprehensive Insurance area to become a "model room" for China's scientific and technological innovative comprehensive insurance area. Beijing Customs will actively explore the innovation of supervision mode relying on Zhongguancun Comprehensive Insurance area.

While consolidating the dominant position of the intelligent port, the company is actively expanding the application of "AI+ industry". The special customs supervision area represented by the comprehensive bonded area is the extension field of the port, which is the key market of the company in recent years. After successfully winning the bid for a number of projects in the customs closure operation of Hainan Free Trade Port, the company's pre-winning bid in the Zhongguancun Comprehensive Protection Zone in Beijing further demonstrated the company's competitiveness in the business field of the customs special supervision zone. to promote the business of the special customs supervision zone to become a new profit growth point for the company.

Port recovery meets peak demand, construction of Hainan free trade port accelerates

Since the beginning of this year, the relevant state departments have gradually liberalized the entry and exit policy and optimized the measures for the management of entry personnel and goods. In addition, in April, the State Port Management Office issued a notice to meet the needs of port development, focusing on five major construction tasks: upgrading intelligent facilities and equipment, building intensive information systems, improving digital operation and management, providing comprehensive services for facilitation, and carrying out regular cross-border cooperation. In the first half of the year, the company successfully won the bid for the upgrading of the information technology of Nanxihe Joint Inspection Building of Hekou Port, the wisdom transformation and upgrading project of Ruili (including Ching-cho) Port (Phase I), the passenger inspection facility project of General Railway of Haikou Port, the Wuliji Port (Phase I) construction project, the Phase III project of Hangzhou Xiaoshan International Airport and the special system supplement project of Joint Inspection Unit of Hangzhou Xiaoshan International Airport. With the full opening of the port and the sharp rebound of the flow of people and goods, as well as the in-depth construction of the smart port, the company's industry is back on the right track, creating favorable conditions for the company's business.

At the same time, this year marks the fifth anniversary of the formal establishment of the Hainan Free Trade Zone (Hong Kong), and it is also a key year for the preparatory work for the construction of Hainan free trade port for customs closure operation on the whole island, speeding up the construction of software and hardware infrastructure for customs closure operation, and the construction of Hainan free trade port has entered an accelerated period. The company closely tracks the progress of the customs closure operation of Hainan Free Trade Port, and the construction project is being actively promoted.

Work with Huawei to open up overseas markets and promote the application of AI+ in the industry

The company has actively opened up overseas markets, and has carried out related business in many countries, such as the United Arab Emirates, Saudi Arabia, Nigeria, C ô te d'Ivoire, Kenya, Senegal, Ethiopia, Egypt, Indonesia, Cambodia, Thailand and so on. It has set up wholly-owned subsidiaries in Nigeria and Cambodia and offices in C ô te d'Ivoire and Senegal. Saudi NEOM, the United Arab Emirates port, Cambodia airport project delivery is nearing completion, and won praise from customers.

The company and Huawei have participated in the pre-planning of many national intelligent transportation projects, and have developed and launched a variety of algorithm, terminal and platform products, including multinational license plate recognition algorithms. it has simultaneously supported all kinds of license plate recognition in more than 30 countries or regions around the world. Intelligent management terminals, multinational license plate recognition, special vehicle supervision, personnel behavior supervision and other products have been applied in Serbia, Saudi Arabia, Bangladesh, the United Arab Emirates and other countries. According to the announcement, the synchronization and technology enabling related to the latest technology of Starflash has been carried out, and the company is expected to apply SparkLink technology to the company's vehicle panoramic look system and other products.

Investment suggestion

Shengshi Technology, as the forerunner and leader of the domestic smart port, has many years of port information construction experience, overall solution advantages, and perfect ecological layout of AI+ products. While consolidating the dominant position of the smart port, it is expected to open up a new performance growth point for the company by opening up the special customs supervision zone market represented by the comprehensive bonded area. We estimate that the operating income of the company from 2023 to 2025 will be 2.623 billion yuan and 2.690 billion yuan respectively, and the net profit will be 3.59 billion yuan and 532 million yuan respectively. Maintain the buy-An investment rating with a six-month target price of 39.88 yuan, equivalent to 28 times dynamic price-to-earnings ratio in 2023.

Risk Tips:

Product and technology R & D risk; overseas business development is not as expected; immigration policy relaxation is not as expected; impairment risk of receivables.