Event: The company released its 24-year report

1) H1 in '24: Achieved operating income of 0.612 billion yuan, a year-on-year decrease of 6.24%; realized net profit to mother of 0.017 billion yuan, a year-on-year decrease of 43.39%.

2) Q2 '24: Achieved operating income of 0.373 billion yuan, a year-on-year decrease of 11.46%; realized net profit to mother of 0.031 billion yuan, a year-on-year decrease of 30.16%.

Innovative businesses have maintained a high growth rate, and their share of revenue continues to rise. According to data disclosed in the company's interim report, the company's revenue from innovation business reached 0.294 billion yuan in the first half of the year, an increase of 33.1% over the previous year, and the revenue share increased from 33.82% in the 23rd mid-year report to 48.01%. The company's new business orders reached 1.283 billion yuan, including 0.295 billion yuan for the cloud hosting business, 0.278 billion yuan for the parking time business, and 0.692 billion yuan for the parking lot operation business, laying the foundation for the company's growth in the second half of the year.

1) Cloud hosting business: The space is vast, and the company's business is in a stage of rapid growth. According to Tongsoft Cloud Big Data Statistics, the number of parking lots nationwide exceeds 1.3 million. If calculated based on the number of four lanes in each parking lot, the number of lanes in stock in the country exceeds 5.2 million. As of 24, the number of parking lanes covered by the company's cloud hosting is 0.0135 million. The company's related business penetration rate is less than 0.3%, and there is plenty of room for future growth. According to the company's 24-year report, 2,143 new lanes have been signed for the cloud hosting business, and 1,540 new managed lanes have been launched. As of the end of the reporting period, the total number of charging lanes for cloud hosting operations was 0.0135 million, and the corresponding cloud hosting business in-hand orders were 0.295 billion yuan. Driven by the cloud hosting business, the software and cloud service business achieved revenue of 99.012 million yuan in the first half of the year, an increase of 31.01% over the previous year.

2) The smart parking operation business is progressing rapidly. The company's core competitiveness is the huge number of users reached by JetParking and reaching more than 0.13 billion car owners online. It has a strong scale effect, which is difficult for competitors to replicate. According to the company's 24-year report, the company achieved online transaction turnover of 11.7 billion yuan for the full year of '23, an increase of 43% over the previous year. In the first half of the year, JetParking achieved online transaction turnover of 6.385 billion yuan, an increase of 16.77% over the previous year. The scale of the smart parking operation business was further increased. In the first half of the year, new orders were signed for smart parking operations, including transaction commissions, advertising operations, value-added operations, parking space revenue growth, etc., of 0.104 billion yuan, an increase of 46% over the previous year; the smart parking operation business achieved revenue of 57.0058 million yuan in the first half of the year, an increase of 18.95% over the same period last year.

3) Parking asset operation: New orders for the parking asset operation business continue to grow. As of the end of the reporting period, the parking time business had accumulated 0.278 billion yuan of unspent time, and the parking lot operation business had accumulated 0.692 billion yuan of on-hand orders. The total order scale for the two businesses was 0.97 billion yuan, laying a solid foundation for the continued growth of the business. Driven by continued growth in hand orders, the parking asset operation business achieved revenue of 0.138 billion yuan in the first half of the year, an increase of 41.67% over the previous year.

“Jet Parking” has entered the Hongmeng ecosystem, further opening up space for smart parking growth. Jet Parking's “find a parking space” capability has been applied to AITO's M5, M7 and other models through the Huawei Hongmeng system. Among them, Xiaoyi's “parking space check” service has the highest click rate in smart cockpits, which can provide convenient and smart parking services for AITO car owners. In addition to cooperation on the Huawei mobile side, the JetParking Service has also entered the Huawei Hongmeng system. AITO car owners can also search for vacant parking lots in advance through the Jet Parking Service Card on the Huawei mobile phone and provide a one-click navigation function. We believe that the company holds a large amount of parking data, which is the core data element for realizing unmanned parking. In the future, it is expected that it will continue to cooperate deeply with Huawei to further open up the growth space for the company's smart parking business.

Maintain an “overweight” investment rating. Considering the decline in the company's traditional business, we lowered our performance expectations. We expect the company's 24-26 revenue to be 1.819/2.139/2.587 billion yuan, and net profit to mother of 0.176/0.234/0.295 billion yuan, corresponding to the current PE of 25.0/18.7/14.9 times, maintaining the company's “gain” rating.

Risk warning: New business development falls short of expectations; industry competition increases risks, etc.