On March 24, 2024, the company released its 2023 annual report. The company achieved revenue of 7.28 billion yuan for the full year of 2023, an increase of 12.0% over the previous year; net profit after deduction was 1.45 billion yuan, an increase of 26.5% over the previous year. The company achieved revenue of 2.91 billion yuan in Q4 in 2023, an increase of 5.4% over the previous year; net profit after deduction was 9.1 billion yuan, an increase of 11.9% over the previous year.
By business: 1) Fortune Technology grew 4.3% year-on-year throughout the year, mainly because the market's demand for credit and innovation products was not fully released. Currently, UF3.0 has been completed at leading brokerage firms, and 2 new strategic customers have been signed to prepare for batch launch. 2) Asset Management Technology grew 9.3% year-on-year. Currently, O45 has completed full-stack Xinchuang R&D, signed 53 new customers, and completed 24 customers. 3) Operational and institutional customers increased 14.3% year-on-year. The new generation of TA signed nearly 100 new customers and completed the launch of the leading customer; the Internet TA launched 18 customers; the new generation valuation system signed more than 30 customers and replaced friends with leading funds. 4) Risk and Platform Technology grew 19.1% year-on-year throughout the year and continued to maintain a good development trend. 5) Data services increased 19.3% year-on-year, mainly due to a 20% year-on-year increase in Juyuan's revenue. Among them, basic data products grew steadily, and large-scale model application products were co-built with many customers. 6) The innovation business grew 12.5% year-on-year, mainly benefiting from Yunyi's revenue growth of 19.5% year-on-year. 7) Corporate finance, insurance core and financial infrastructure increased by 23.1% year-on-year throughout the year. Among them, transaction banks and bill payment businesses were in good demand, and breakthroughs were achieved in payment clearing services.
In terms of expenses, the company's total cost and sales/management/R&D expenses in 2023 was 6.04 billion yuan, an increase of 8.7% over the previous year, and the growth rate slowed. Mainly, companies focus on improving personnel quality and efficiency. At the end of 2023, the number of people in the company fell by 1.2%, generating revenue per capita of 549,000 yuan, a record high. In its annual report, the company expects steady revenue growth in 2024, with expenses growing at a lower rate than revenue. We expect the company to continue improving quality and efficiency in 2024. According to the company's previous stock option incentive plan, the company's target for 2024 is revenue growth of 0% (trigger value) to 15% (target value), and net profit growth of not less than 10%. As the company's core system Xinchuang benchmarks are gradually established, it is expected to bring potential batch delivery opportunities.
Based on the company's 2023 annual report and expectations for steady industry growth, we expect the company's revenue from 2024 to 2026 to be 80.2/89.4/9.98 billion yuan, up 10.1%/11.5%/11.6% year on year; net profit to mother will be 17.2/19.2/2.16 billion yuan, up 20.8%/11.6%/12.5% year on year, corresponding to 27.5/24.6/21.9 times PE, respectively, to maintain the “buy” rating.
Financial industry demand falls short of expectations; corporate fee control falls short of expectations; the pace of policy implementation falls short of expectations; competitive risks.