Key points of investment
On August 27, 2024, the company's semi-annual report was disclosed. In the first half of the year, the company achieved total revenue of 0.397 billion yuan, a year-on-year decrease of 10.63%, and realized net profit to mother of 59.8116 million yuan, a year-on-year decrease of 14.12%. During the reporting period, the company relied on self-development to develop Tianda models and continued to expand in financial and media scenarios. The big model project achieved revenue of 48.6254 million yuan, and the AI+ big data commercialization process continued to advance.
The semi-annual report revealed that the overall revenue scale remained steady. The gross margin increased significantly year-on-year in the first half of 2024. The company achieved total operating income of 0.397 billion yuan, a year-on-year decrease of 10.63%, achieved net profit to mother of 59.8116 million yuan, a year-on-year decrease of 14.12%, net profit not deducted from the mother was 36.5712 million yuan, a year-on-year decrease of 27.28%, and the company's overall gross profit margin was 70.28%, up 7.22pct year on year. In the first half of 2024, the company's sales, management and R&D expenses were 16.08%/26.31%/17.84%, respectively, down 3.13 pcts, up 5.17 pcts, and 2.67 pcts, respectively.
The company's big data and artificial intelligence-related businesses maintained a steady growth trend. In the first half of 2024, the company's big data software products and services, artificial intelligence software products and services, security products, system integration and other four major businesses achieved revenue of 2.13/0.102/0.035/0.048 billion yuan, with year-on-year differences of +3.44%/+27.71%/-44.64%/-50.33%, respectively. The gross margin of each business was 78.36%/67.81%/70.77%/70.77%/ 39.20%. The company's big data and artificial intelligence related business maintained a good growth trend during the reporting period.
By industry, in the first half of 2024, corporate customer businesses such as government, public safety, internet and media, and finance and manufacturing achieved revenue of 0.93/0.086/0.04/0.178 billion yuan respectively, down 7.24%/24.71%/19.32%/1.24% year-on-year respectively. The scale of revenue contributions from financial and manufacturing enterprise customers remained stable.
The company's large-scale model applications were implemented at an accelerated pace, and the big model and big data services steadily expanded the market space in the first half of 2024. The company continued to implement scenario applications in the financial, media, security and other industries based on the Piotanda Model, including Ping An Bank Audit Brain, China Merchants Bank Intelligent Consumer Insurance Assistant, People's Daily AIGC Intelligent Editing Assistant, etc. The large model project achieved revenue of 48.6254 million yuan during the reporting period. At the same time, the company relied on its long-term competitive advantage in the field of open source data services. Through integration with large model capabilities, the data service business maintained steady growth during the reporting period, adding 25 new media users, 18 government and enterprise users, and 12 users in the security field. Among them, the maximum contract amount for open source data collection service projects was 12 million.
Profit forecasting and valuation
We expect the company to achieve revenue of 1.004/1.307/1.642 billion yuan in 2024-2026, with year-on-year growth rates of 28.40%/30.22%/25.63%, corresponding net profit of 0.23/0.312/0.402 billion yuan, respectively, the year-on-year growth rates of 531.54%/35.65%/28.60%, corresponding EPS of 0.29/0.39/0.51 yuan, maintaining the “buy” rating.
Risk warning
1. Risks brought about by increased market competition; 2. Risks caused by order growth or failure to meet expectations; 3. Risks brought about by insufficient implementation and commercialization of AIGC-related technologies.