3Q23 performance is in line with our expectations
Wealth trend 1-3Q23 revenue year-on-year + 26% to 249 million yuan, return net profit + 19.7% to 198 million yuan, non-return net profit + 22% year-on-year to 164 million yuan 3Q23's single-quarter revenue is from + 27% / month-on-month + 23% to 101 million yuan, and the net profit from return to home is from + 27% to 79.45 million yuan (vs.3Q22 net profit is-29.14 million yuan due to a loss of 110 million yuan due to changes in fair value), and deducts non-return net profit from + 26% / month-on-month + 30% to 69.05 million yuan, which is in line with our expectations.
Trend of development
B-end business revenue is growing steadily. The average daily trading volume of the 3Q23 A stock market is-13% / month-on-month-21% to 798.4 billion yuan, and the CSI 300 index-4% / gem index-10%. Despite the pressure on the market performance, the company's 3Q23 revenue recorded steady growth compared with the previous month, which we believe is mainly due to the steady growth of the company's software sales and maintenance service revenue to B-end customers such as securities companies (1H23 contributes 77% of the company's income). In terms of key operating indicators, the cash received by 3Q23 for selling goods and providing services is + 12% / month-on-month + 52% to 100 million yuan, and contract liabilities-accounts received in advance are + 18% / month-on-month-6.5% to 130 million yuan. In addition, the C-end securities information service business, QuestMobile Statistics Company access letter App 3Q23 average MAU year-on-year + 26% / month-on-month + 8% to 1.8 million, the overall C-end user growth performance is good.
The cost and expense maintain the advantage, and the profit end increases steadily. 3Q23's gross profit margin remained relatively high compared with the same period last year-1.6ppt/ + 1.3ppt to 83%, and the sales expense rate / management expense rate was 2.4% / 1.9% respectively, maintaining a relatively low level. R & D expenses were + 2.9% / month-on-month + 8.2% to 16.56 million yuan, and R & D expenditure rates were year-on-year-3.8ppt/-2.2ppt to 16.4%. The total investment-related income (investment income + fair value change income) turned positive from loss to 12.37 million yuan, mainly because 3Q22 reduced the fair value of three debt investment products that did not normally pay principal and interest to 0 and recorded a loss of investment income of 99 million yuan. Financial income is-17% / month-on-month-16% to 11.33 million yuan; operating profit excluding investment income and financial expenses is + 33% / month-on-month + 32% to 66.12 million yuan. In addition, the company recently announced the acquisition of 33% stake in Fujian Xinyi Technology Co., Ltd. the target company is mainly engaged in financial and securities industry application software development, and the products are related to the middle and back-end business of securities trades. we believe that this may form a synergy with the company's existing software business and further strengthen the company's B-end product power.
Profit forecast and valuation
Basically keep the profit forecast unchanged. The company is currently trading on 61x/49x 23e/24e Pamp E; maintains its target price of RMB 190, corresponding to 65x 24e Pamp E and 33% upstream space; and maintains an industry rating that outperforms.
Risk
The activity of the city is declining, the business and customer structure is single, and the supervision of the information system is stricter.