Investment events: The company released the three-quarter report for 2023: (1) Revenue for the first three quarters reached 1,586 billion yuan, up 13.93% year on year; net profit was a loss of 40 million yuan; net profit after deducting non-return net profit was a loss of 103 million yuan; (2) revenue for the third quarter was 563 million yuan, down 7.93% year on year; net profit was a loss of 51 million yuan, and net profit after deducting a loss of 74 million yuan.

Affected by the macro environment, the company's performance was under pressure in the short term. Due to the continued impact of the macroeconomic environment, the company's revenue growth has slowed, but the company continues to increase investment in R&D, marketing, etc., and various expenses have increased, resulting in a clear impact on net profit. The company's revenue for the first three quarters reached 1,586 billion yuan, an increase of 13.93% over the previous year. The growth rate slowed down, while the net profit of the mother lost 40 million yuan. Currently, the company's performance is under temporary pressure.

Investment in research and development has continued to be increased, and large-scale remote sensing model products have been launched. The company attaches importance to research and development of new products and technologies, and continues to increase investment in R&D. In the first three quarters of 2023, the company's R&D investment reached 275 million yuan, an increase of 40.05% over the previous year. The proportion of R&D investment in revenue was as high as 17.31%, an increase of 3.23 percentage points over the previous year. In terms of large models, the company targets multi-modal remote sensing data, develops “Tianquan” visual large-scale models, and strives to build an intelligent remote sensing ecosystem integrating “segmentation, detection, and generation”.

The smooth expansion of international business is expected to open up new space for business development. The company insists on developing overseas markets and seeking new space for business development. In July of this year, the company successfully won the bid for the “Bolivia National Integrated Radio Spectrum System - La Paz Electromagnetic Spectrum Acquisition and Monitoring System” project. The project amount reached US$22.387 million. The project was officially signed in September this year. The company has successfully built a “upstream autonomous data - midstream independent platform - downstream large-scale application” business layout, completed the construction of a whole industry chain ecosystem, and its products and services have strong competitive advantages at home and abroad. Overseas market results are beginning to show. Relying on strong competitiveness, the company is expected to open up new space for business development.

Investment advice: Due to the impact of macroeconomic factors, the company's increase in R&D investment and new business investment, etc., we have adjusted the company's profit forecast. Before the adjustment, we expect the company's revenue for 2023/2024 to be 28.47/3.879 billion yuan and net profit of 400/558 million yuan respectively. After adjustments, we expect the company's revenue in 2023/2024/2025 to be 30.89/40.30/5.272 billion yuan, net profit of 3.20/4.49/651 billion yuan, respectively, and corresponding PE of 38.9/27.7/19.1 times, respectively. Consider the integrated layout of the company's industrial chain to enhance competitiveness, maintain high business growth, and give the company a “buy” rating.

Risk warning: business development falls short of expectations, policy implementation is slow