Recently, East Money Information released a research report, stating that DC Holdings (00861) focuses on the 'big data + AI' global strategy, continuously building data analysis and decision-making products and intelligent applications for governmental and enterprise clients, realizing the commercialization of high-quality data and AI application scenarios. The bank expects the company's revenue for 2024-2026 to be 19.299/20.531/22.145 billion yuan respectively; net income attributable to equity holders respectively 0.374/0.571/0.741 billion yuan; corresponding EPS respectively 0.22/0.34/0.44 yuan per share; corresponding PE respectively 13/9/7 times, giving it a 'shareholding' rating.

The main contents of the research report are as follows:

The company released its 2024 interim report. In the first half of 2024, the company achieved total operating income of 7.014 billion yuan, a 5% year-on-year increase; achieved gross profit of 0.957 billion yuan, with a gross profit margin of 13.65%, a 2.96 percentage point decrease year-on-year; achieved net income attributable to equity holders of 0.011 billion yuan, a 73% year-on-year decrease. The decline in profit was mainly due to the impact of the subsidiary Digital China Information Service Group. If Digital China Information Service Group is excluded, the company achieved operating income of 2.936 billion yuan, a 20% year-on-year increase; achieved net income attributable to equity holders of 0.041 billion yuan, a 380% year-on-year increase.

The 'big data + AI' growth is strong, with sufficient orders in hand. In the first half of 2024, the company's big data products and solutions generated revenue of 1.277 billion yuan, a 17% year-on-year increase, with a compound annual growth rate of 26% over the past four years. Revenue contribution increased from 9% to 18%; achieved gross profit of 0.315 billion yuan, a 18% year-on-year decrease, with a compound annual growth rate of 9% over the past four years. The decline in gross profit in the first half was due to the decline in downstream market demand at the subsidiary Digital China Information Service Group and increased investment in new product lines. If the subsidiary's impact is excluded, the company's revenue from big data products and solutions increased by 31% year-on-year, with gross profit increasing by 11%. In the first half of 2024, the company's big data business had signed but unfulfilled orders amounting to 2.424 billion yuan, a 15% year-on-year increase, providing a solid guarantee for the long-term stable development of this business. Furthermore, the company continues to increase investment in the research and development of 'big data + AI' products, seizing the market advantage with AI scene applications. R&D expenditure for the first half of 2024 reached 0.32 billion yuan, maintaining a leading position in the industry.

The overseas business opens a second growth curve. In the first half of 2024, the company accelerated its overseas layout, with overseas revenue reaching 0.465 billion yuan, a 55% year-on-year increase, increasing revenue contribution to 7%. Currently, the company's strategic layout in the South China Greater Bay Area has been basically completed. The company is venturing overseas in collaboration with clients such as Huawei, Honor, ZTE, and BYD, using the 'enterprise CSO' model to create a one-stop cross-border service platform, providing end-to-end cross-border supply chain solutions for overseas enterprises. During the first half of the year, the company successively won bids for projects such as the ocean meteorological forecasting project of the University of Macau and BYD's supply chain overseas business orders in Thailand and Vietnam. By utilizing AI technology to provide decision-making assistance, it empowers customers to reduce costs, increase efficiency, and innovate in their business. Leveraging technological advantages and industry accumulations, the company is continuously expanding its market space, poised to achieve significant business growth.