Event: On March 11, 2024, Neusoft Group held a strategy conference to announce the full launch of an intelligent solution strategy, focusing on business areas such as smart cities, healthcare, smart car connectivity, and enterprise digital transformation to create AI-enabled solutions, data value-based solutions, and service-oriented solutions.
Take advantage of the upward trend in the global IT industry and embrace intelligence to start new changes. Dr. Liu Jiren, founder and chairman of Neusoft Group, pointed out in his speech at the press conference that the global IT service and software market continues to develop rapidly, the infrastructure of the digital society, such as connectivity, computing power, storage power, data, and AI, continues to expand, and the vitality of the software industry continues to expand. With the rapid commercialization of artificial intelligence and the growth of data, the demand for solutions from the company's downstream customers has changed from achieving accurate operation of their system processes in the traditional sense to intelligence and data value creation. Intelligence has become an opportunity for Neusoft to start a new round of change and growth.
Leading companies in core information infrastructure create a complete product matrix to form a collaborative advantage. Main business:
1) AI will be an important component of the solution and the partner of the solution. Neusoft fully integrates AI technology and solution capabilities to accelerate the promotion of “artificial intelligence +” and enable industrial upgrading and transformation.
Currently, Neusoft uses its own data and customer resources in advantageous business fields to train large models in vertical fields, and launched Neusoft Big Language Model System Engineering LLM-SE, which is widely used in the fields of medical care, human society, health insurance, government affairs, media, finance, administration of justice, operation and maintenance. 2) Future solutions will be a way for data to create value and a platform for generating valuable data. To this end, Neusoft will fully tap the value of data elements and strengthen the discovery, innovation, and monetization of data valuing in smart cities, healthcare, etc. At present, Neusoft's exploration of data value in the medical field has achieved positive results. It will also develop data value solutions for other industries, participate in and promote China's digital transformation, and empower the country's economic development. 3) Neusoft uses solutions to create service models to transform the value of software into services that surpass technology. In the field of healthcare, Neusoft has built an information and data management platform for medical communities to actively enable innovative county medical community solutions through analysis of operational data.
The leisurely years have established the company's heritage, and equity incentives have given employees confidence. The company was founded in 1991 as the first listed software company in China. After more than 30 years of accumulation, the company has enabled tens of thousands of large and medium-sized customers around the world to achieve informatization, digitalization and intelligent development. According to the “Neusoft Group Co., Ltd. 2024 Stock Option Incentive Plan” issued by the company on March 11, 2024, the company granted 32.34 million shares of stock options to 162 employees at a price of 8.23 yuan/share, demonstrating the company's determination to develop.
Investment advice: The company actively embraces intelligence to begin transformation. As various plans continue to be implemented, the company's unreleased space and energy in development is expected to be gradually released as the business progresses. We expect the company's revenue for 2023-2025 to be 106.32/125.60/15.103 billion yuan, net profit to mother of 0.70/2.30/300 million yuan, corresponding PE is 153X, 47X, and 36X respectively, maintaining the “recommended” rating.
Risk warning: Competition in the industry intensifies; product implementation falls short of expectations.