occurrences
La Cala released its report for the third quarter of 2024. In the first three quarters of 2024, the company achieved revenue of 4.389 billion yuan, a year-on-year decrease of 0.78%; net profit to mother of 0.513 billion yuan, a year-on-year decrease of 17.49%; net profit after deducting non-return to mother of 0.516 billion yuan, an increase of 7.26% year on year; gross margin was 31.22%, up 1.59 pct year on year. In the third quarter of 2024, the company achieved revenue of 14.075 billion yuan, a year-on-year decrease of 3.28%; net profit to mother of 0.093 billion yuan, a year-on-year decrease of 15.20%; net profit after deducting 0.104 billion yuan, a year-on-year decrease of 47.63%; and gross margin of 27.64%, a year-on-year decrease of 2.25pct.
The market share is rising steadily, and the amount of QR code scanning transactions is growing rapidly
In the first three quarters, the company paid a transaction amount of 3.19 trillion yuan. The transaction scale continued to lead the industry, and its market share increased steadily. Among them, code scanning transactions grew rapidly, with a transaction amount of 1 trillion yuan, up 18.86% year on year; bank card transaction amount was 2.18 trillion yuan, a decrease of 14.80% year on year, lower than the overall level of the industry. The revenue from the digital payment business in the main business was 3.91 billion yuan, up 1.89% year over year. In the third quarter, the company's net profit after deduction decreased by 95 million yuan year-on-year, mainly due to factors such as investment income of 50 million yuan included in recurring profit and loss in the same period in 2023, and seasonal differences in payment service revenue.
Jointly invest in the establishment of Koala Information Technology to build a leading credit information service enterprise. The company announced that it plans to jointly invest 30 million yuan to establish Koala Information Technology, with a shareholding ratio of 30%. After establishment, it will mainly carry out R&D and promotion of credit data information products and related intelligent applications in the financial sector. This investment can introduce a professional team from Bangde Digital Technology, combine the company's resources and advantages in payment technology and fintech, use credit technology as support to enter the field of bond credit information services, and build a leading credit information service enterprise in China through independent and objective rating standards, professional credit analysis technology and capabilities, and leading big data and AI technology capabilities.
Investment advice
Considering the decline in bank card transaction amounts, we expect the company's revenue for 2024-2026 to be 6.067/6.638/7.331 billion yuan, respectively, with year-on-year growth rates of 2.23%/9.42%/10.43%, respectively, and net profit to mother of 0.695/0.822/0.974 billion yuan, respectively, with year-on-year growth rates of 51.96%/18.19%/18.55%, EPS of 0.87/1.03/1.22 yuan/share, respectively. 28.65% Given the company's stable position as a leading third-party payment provider, it has also benefited from a recovery in offline consumption and an increase in net rates, maintaining a “buy” rating.
Risk warning: industry policy risks, GPV falling short of expectations, rate increases falling short of expectations, merchant expansion and management risks.