Kirin Xin'an uses operating systems as the root technology to innovate and develop products such as information security and cloud computing to provide safe and efficient products and services for key industries such as defense, electricity, and government affairs.

Server operating systems are mainly used in the electricity and defense industries, and are gradually expanding to other fields such as government affairs, finance, energy, and transportation. The company mainly uses server operating systems, which have been applied on a large scale in key fields such as electricity and national defense. In the power sector, the company began large-scale application of the National Grid Smart Grid Scheduling Platform D5000 construction project in 2011. Since 2013, it has successfully applied the China Southern Power Grid Integrated Regulation and Control System (OS2) construction project, and has now launched more than 0.2 million units.

With the promotion of localization + the discontinuation of CentOS and close cooperation with Euler, the operating system ushered in a golden period of development. At the industry level, the funding sources for the Xinchuang industry are expected to improve marginally, the superposition time is becoming more urgent, and the domestic substitution of Xinchuang is expected to accelerate. At the same time, CentOS stopped catalyzing and accelerated domestic replacement, migration, and hardening requirements. (1) Kirin Xin'an operating system products entered the national inspection list in May 2024, making Party, Government, and Xinchuang expected to become a new growth point for the company, and make up for shortcomings and improve competitiveness significantly in other industries such as finance and transportation. (2) In the field of digital defense, the company's products have all been shortlisted and are widely used in military office, training, command, space survey, development and control scenarios. (3) In the power industry, the localization of existing production systems continues, and there is still room for penetration. At the same time, the next-generation scheduling system for the 14th Five-Year Grid has begun to be piloted, and the next-generation scheduling system is building a new growth engine; in the scenario, the company's operating system also extends from the main station control to the station side, from the main network to the distribution network, and then to the fields of transformation, use of electricity, power generation, energy storage, power equipment, and new energy generation, etc., opening up new growth space.

Cloud desktop is a powerful tool for centralized operation and maintenance management, data security, and ecological migration, fully benefiting from the “cloud+terminal” wave. Cloud desktop is a remote desktop service that provides computing and storage capabilities in the cloud. As IT architectures evolve to “cloud+”, there is a strong demand for cloud desktop solutions to replace traditional PCs. Furthermore, under the wave of Xinchuang, cloud desktop is expected to effectively mitigate the problem of application software migration and adaptation, and facilitate unified control of desktop resources and improve information security. Party, government, and credit sinks to the district and county level. Cloud desktop is expected to solve the problem of distributed terminal operation and maintenance, and continuous rapid growth is worth looking forward to.

Information security is deeply involved in the field of national defense and is gradually expanding to other industries. The product qualifications are rich, and the pace is expected to accelerate significantly. The company's information security products focus on data storage security, are deeply involved in the field of national defense, and have passed the evaluation of commercial cryptographic products by the National Cryptographic Administration to actively expand application fields such as government affairs and electricity. At the same time, the company is also actively laying out a terminal security product line to provide unified integration and unified management of security subsystems for domestic terminals.

Profit forecast: We forecast that the company's net profit due to mother in 2024-2026 will be 26 million yuan, 0.104 billion yuan, and 0.202 billion yuan, respectively, covered for the first time, and given a “buy” rating.

Risk warning: Local finances are tight, competition is intensifying, and profit forecasts are being revised downgraded.