Incident: On April 14, 2024, the company released its 2023 annual report. In 2023, the company achieved operating income of 1,979 million yuan, up 24.00% year on year; net profit to mother was 152 million yuan, up 144.92% year on year; net profit after deducting non-return to mother was 111 million yuan, up 129.30% year on year.
Goodwill and bad debts are calculated, and it is expected that they will go to battle lightly in the future. 1) Goodwill impairment: The subsidiaries Shanghai Shuhui and Beijing Antu have clearly recovered their business in 2023 and invested heavily in promoting project acceptance. The company did not expect any impairment of goodwill when its performance was forecast at the beginning of the year. After a later audit, although both companies' revenue exceeded expectations, profits fell short of expectations. An impairment loss of goodwill was calculated based on prudential principles, involving an amount of 1.59 million yuan. 2) Bad debt accruals exceeded original expectations: In 2023, the company increased its repayment efforts, and the overall repayment situation improved year on year. Therefore, when the performance was forecast at the beginning of the year, the company expected the amount of bad debt accruals to decline year on year. After an audit, the long-term repayment situation was not ideal. Accounts receivable that were over 3 years old increased dramatically, and the company fully charged accounts receivable for 3 years or more, resulting in a marked increase in bad debt loss accrual compared to the performance forecast, involving an amount of about 37 million yuan.
Build two major benchmark projects in Tangshan and Taizhou, and lay out public data operations in depth. 1) Tangshan Comprehensive Information Platform Construction Project: The project is the company's comprehensive information infrastructure project for prefecture-level big data bureaus. It is a sample project for the company's prefecture-level big data bureau; through this project, the company has formed solutions and products for the full business of big data bureaus, laying a solid foundation and forming a model case for subsequent business development.
2) A strategic cooperation framework agreement was signed with Taizhou Data Industry Group: the company built a data operation framework service around public data operation, built a localized spatial location data platform, developed a series of governance tools and provided an open source data platform, continued to deepen research and construction (spatial information × data elements) × (To G/B/C) typical data operation scenarios, and set a benchmark for data element operation.
AI empowers the potential of the GIS industry and actively promotes the integration of remote sensing GIS. 1) NLP big model:
The company released an intelligent question-and-answer product (beta version) based on the big model of real estate and AI. 2) CV large model:
The company released SuperMap GIS 2023 integrated the SAM visual large model. 3) AIGC: The subsidiary Shanghai Shuhui explored and built the “LandGPT Big Model+Planning” solution based on AIGC technology.
4) GeoAI: The company added models such as SegFormer and RTMDet to improve the accuracy and efficiency of intelligent remote sensing interpretation, and also added support for multi-band data. By introducing multi-band information from remote sensing data into the AI model, the company helps expand application scenarios and further develop intelligent remote sensing applications in the fields of natural resources and ecological environment.
Investment proposal: The company is the world's leading GIS industry leader, building a second growth curve based on the basic market, expanding into digital twin water conservancy, meteorology, airports, etc., and seizing opportunities such as Xinchuang and virtual 3D China, with sufficient growth momentum; at the same time, it is deeply laying out forward-looking opportunities and making efforts to open up long-term growth space in the fields of AI and data elements. The company's net profit for 2024-2026 is estimated to be 308/415/531 million yuan. The corresponding PE is 26X, 19X, and 15X, respectively, maintaining the “recommended” rating.
Risk warning: New technology advances fall short of expectations; industry demand releases fluctuations; industry competition intensifies; project management risks.