Incident: The company released its 2023 annual report. In 2023, it achieved operating income of 86.314 billion yuan, +12.7% year over year; realized net profit of 240 million yuan, +18.3% year over year; realized net profit without return to mother of 191 million yuan, +12.6% year over year.
Industrial data services have been steadily improving, offline services have recovered significantly, and gross margins have been slightly affected. In 2023, the company's industrial data service sector achieved revenue of 802 million yuan, a year-on-year increase of 16.0%, with a three-year compound growth rate of 18.9%. Among them, data subscription revenue reached 439 million yuan, up 4.8% year on year, accounting for 54.8% of industrial data service revenue, with a three-year compound growth rate of 17.7%. The subscription service has been recognized by the market, and the number of paying users exceeds 310,000. The offline data business recovered rapidly, and revenue from conference and training services was 96.88 million yuan, an increase of 90.1% over the previous year. In terms of gross margin, the company is actively expanding new product segments. The goal is to successfully replicate the development experience of the black sector, which has led to a slight decline in gross margin. The gross margin of the company's data subscription service in 2023 was 57.34%, down 0.77pct year over year.
The scale of steel transactions continues to grow. In 2023, the settlement volume of the company's steel and silver e-commerce platform continued to grow, reaching 63.6407 million tons, an increase of 20.1% over the previous year. Steel and silver e-commerce achieved revenue of 85.508 billion yuan, an increase of 12.7% over the previous year; net profit attributable to the company's shareholders was 320 million yuan, an increase of 17.3% over the previous year. The company continues to consolidate the service capabilities of the Steel and Silver e-commerce platform, actively promote the digital transformation and upgrading of the industry, continuously improve product quality and user experience, strengthen the review of the qualifications and products sold by operators within the platform, adjust the supply chain service business structure, strengthen risk management and control, and actively shrink some high-risk businesses to ensure the company's stable and continuous operation.
AI capabilities and data asset listing policies are expected to be implemented. The company actively invested in the research and development of AI-related technical capabilities, launched the “Steel Master” vertical language model for the commodity industry in 2023, and successfully developed the commodity industry's first “Xiaogang” digital intelligent assistant, an application of the commodity industry's first vertical language model based on the commodity industry's three scenarios of trade, analysis, consulting, and content generation. It is expected to achieve commercial implementation in 24 years. The “Interim Provisions on Accounting Processing Related to Enterprise Data Resources” issued by the Ministry of Finance officially came into effect on January 1, 24. Data assets that meet the conditions can be directly entered into the table. As a leading domestic commodity data service provider, the company has accumulated a large number of high-quality data resources, which is expected to directly increase the company's assets and profits with the implementation of the policy.
Based on the reduction of the company's operating income, gross margin and expense forecasts in the 23 annual report, the adjusted earnings per share forecast for 24-25 were 0.89 and 1.08 yuan (previous values were 0.87 and 1.01 yuan), and the additional earnings forecast per share for 26 years was 1.24 yuan.
Referring to the 24-year price-earnings ratio of comparable companies, the corresponding target price is 24.92 yuan, maintaining an increase in holdings rating.
Risk warning
Policy implementation falls short of expectations; market competition increases risk; steel industry fluctuation risk; credit management risk