Matters:

The company released its 2024 semi-annual report. In the first half of the year, it achieved operating income of 0.72 billion yuan, +5.7% year-on-year; realized net profit to mother of 0.008 billion yuan, -72.7% year-on-year. Q2 achieved revenue of 0.42 billion yuan in a single quarter, -1% year over year; realized net profit of 0.03 billion yuan to mother, +5.2% year over year.

Commentary:

Adhere to technology-driven and iterative upgrades of core products. The company officially released a comprehensive AI strategy in May, upgrading the core product “What's Worth Buying” App to “What's Native to AI Is Worth Buying GEN2”, while actively promoting overseas plans. Currently, the company has a multi-faceted layout in the AIGC field: 1) “What is worth buying” GEN2, fully applies AI technology, creates a new consumer content community ecosystem, and strives to achieve breakthroughs in the user community and growth in the number of users. 2) AI smart shopping assistant “small value”. “small value” provides a quick summary based on real-time consumer experience and price information throughout the network to provide personalized suggestions for consumers with different decision-making difficulties. The launch of “small value” has increased the activity and experience of “what is worth buying” users, and is also the company's exploration of future e-commerce interaction patterns. 3) Content supply. During the reporting period, the number of “what is worth buying” content published was 15.4362 million, an increase of 21.89% over the previous year. Among them, machine-contributed content (AIGC) increased by 46.03% year on year, accounting for 39.61%.

Diversify the business to form a three-dimensional service system. 1) Consumer content sector. The company mainly collaborated to build a consumer content sector through consumer content communities “what is worth buying” and consumer MCN, etc., to form a consumer content system covering users inside and outside the site, and an integrated marketing system for customers to help e-commerce platforms and brands achieve the integration of quality and efficiency. 2) Marketing service sector. The company relies on “what is worth buying” in the consumer content community, and internal and external traffic systems built by various vertical applications and consumer MCN businesses to thoroughly lay out the marketing service sector to empower e-commerce platforms and brands through content to help them seize the huge dividends of the content era and strive to achieve leapfrog development. 3) In the consumer data section, the company's product database has included more than 0.33 million brands and 16.35 million aggregated products.

Focus on user experience and enhance community activity. The company carried out a limited amount of effective advertising at the New Year Festival and 618, two important promotion points in the first half of the year. At the same time, it collaborated with “Are You Hungry” to create a marketing hotspot, which had more than 30 million exposures, greatly increasing brand awareness. In the first half of 2024, “what is worth buying” users remained stable. The average number of monthly active users was 37.7903 million, up 1.62% year on year, and the number of registered users reached 29.6445 million, up 7.02% year on year; mobile app activations were 74.9805 million, up 11.56% year on year.

Investment advice: We are optimistic about the company's layout in the AIGC field and the prospects for building “what is worth buying” community content. The estimated revenue for 2024-2026 is 1.65/1.86/2.05 billion, and the net profit to mother for 2024-2026 is 0.078/0.125/0.181 billion yuan. Referring to comparable company valuations, the company was given 30xPE in 2025, corresponding to a market value of 3.7 billion yuan and a target price of 18.8 yuan, maintaining a “recommended” rating.

Risk warning: AI technology has fallen short of expectations, the consumer industry is weak, and industry competition is intensifying.