Overview of events:
1) recently, Pu Lian Software released the third quarter report of 2023. In the first three quarters of 2023, the company achieved an operating income of 278 million yuan, an increase of 8.16% over the same period last year; a net profit of-31 million yuan, a year-on-year increase of-335.58%; an operating income of 125 million yuan in the third quarter alone, an increase of 32.74% over the same period last year; and a net profit of 887000 yuan,-75.84% over the same period last year.
2) recently, PUL Software Global Treasurer Development Seminar and 2023 Treasurer user Conference were successfully held. At the meeting, the "value Global Treasurer White Paper" was officially released, and senior business experts from the fields of petroleum and petrochemical, energy and electric power shared their experiences and looked forward to the future with the practice of treasurer construction in this unit.
High income increase in the third quarter or consolidate the foundation of annual performance
According to the three quarterly reports, the company achieved a high increase in revenue and turned profits into profits in the third quarter, mainly due to the gradual increase of new customers, business expansion in new areas, and the follow-up operation and maintenance business of completed projects. In terms of expenses, the company's sales expenses increased by 337.75% in the first three quarters compared with the same period last year, mainly because the company strengthened the construction of the sales team, and the increase in the number of sales staff led to an increase in salary costs; on the other hand, the construction integration project failed to obtain customer orders, and the pre-project put forward sales expenses. Unilaterally, although the company did not disclose specific data, the inventory in the first three quarters was 218 million yuan, an increase of 197.06% compared with the end of 2022, mainly due to the continuous expansion of the company's business scale and the existence of a certain delivery cycle for large group customer projects. due to the increase in the cost of delivering customer projects.
We believe that the high increase in revenue and the turnaround of profits in the third quarter alone reflect the high elasticity of the company's performance growth and the robustness of operating fundamentals since the second half of the year; the sharp increase in inventory means that the company has abundant orders on hand, and the downstream demand and prosperity are relatively high. With the delivery and acceptance of the relevant projects in the fourth quarter, the company's full-year performance is expected to achieve the equity incentive growth target, and the net profit level may be greatly improved.
The company has made remarkable achievements in leading the construction of treasurer system of central state-owned enterprises.
According to the company's official Wechat account, the treasurer system is an enterprise group relying on financial companies, capital centers and other management platforms, using modern network information technology, focusing on capital concentration and information concentration of enterprise groups. to improve capital operation efficiency, reduce capital cost, prevent and control capital risk as the goal, service strategy, support business, and create value as the guide. A modern corporate governance mechanism for real-time monitoring and overall scheduling of financial resources such as corporate funds. In early 2022, the SASAC of the State Council issued the opinions on promoting the Central Enterprises to accelerate the Construction of the Treasurer system and further strengthen the Fund Management, requiring all central enterprises to basically build a treasurer information system that is "intelligent and friendly, penetrating and visible, powerful, safe and reliable" by the end of 2023. All subsidiary enterprise bank accounts are visible, capital flows are all traceable, and collected funds are all controllable. To realize the systematization, institutionalization, standardization and informationization of treasurer management.
In this context, a new round of central enterprise treasurer construction boom is under way. At present, the construction of treasurer system is not only a top-down policy requirement, but also a spontaneous behavior trend for enterprises to actively target the world-class level and actively participate in the international cycle. Over the past 20 years, PUL Software has rich experience in centralized fund management and direct connection of major commercial banks at home and abroad in the field of group treasurer, and has carried out the innovative practice of treasurer management system with a number of large central enterprises, and has trained the treasurer team. formed an accumulation and led the development of the industry. In recent years, the company has made remarkable achievements in the field of treasurer system construction, and has successively undertaken the construction of treasurer management projects of central enterprises such as Aviation Industry Corporation of China, CNNC, Arms Group, China Eastern Airlines Group, Sinopharmaceutical Group, CRRC Corporation, Sinochem, and so on. Up to now, Pu Lian Software has provided treasurer management information system for 21 central enterprises and some local state-owned enterprises and leading private enterprises. The construction scope of Pu Lian software treasurer system has covered more than 80 countries and regions around the world.
Investment suggestion
As a leader in the information construction of large groups, we estimate that the operating income of the company from 2023 to 2025 will be 9.24 million yuan and 1.518 billion yuan respectively, and the net profit will be 2.03 million yuan and 289 million yuan respectively. Maintain a buy-An investment rating with a 12-month target price of 28.56 yuan, equivalent to a dynamic price-to-earnings ratio of 20 times in 2024.
Risk Tips:
The risk of high customer concentration; the risk of seasonal fluctuations in performance; technological innovation is not as expected.