The strategy focuses on large group companies and advantageous business areas. The company was founded in 2001 and is a comprehensive management informatization solution provider for large group enterprises. Its main business covers various aspects such as solutions, consulting and services, application software products, platform software products, and customized software development. For strategic customers, the company has constructed headquarters-level integrated construction systems for the six major central enterprises of CNPC, Sinopec, CNOOC, China Construction, and China Railway to give full play to the competitive advantages of the Group's management and control business, and continue to expand the business field with long-term services. Facing advantageous businesses, the company is gradually expanding new business fields with competitive advantages in segments such as group treasury management, intelligent financial sharing, and XBRL data application.

New customers and expansion into new fields, and steady growth in performance. In the first three quarters of 2024, the company achieved operating income of 0.294 billion yuan, an increase of 5.86% year on year; net profit to mother was 0.015 billion yuan, an increase of 148.36% year on year.

The company continues to expand its business with new customers and new fields, and the customer base and business areas continue to expand. At the same time, the follow-up maintenance business for completed projects is gradually increasing, and operation and maintenance revenue remains stable. By industry, the business of the three traditional dominant industries of petroleum and petrochemicals, construction and real estate, and finance and insurance remained stable. The first three quarters achieved revenue of 0.151 billion yuan, 67.68 million yuan, and 23.1 million yuan respectively, accounting for 51.39%, 23.04%, and 7.86% of revenue, respectively. The company's business is characterized by seasonal distribution. Sales in the 1st to 3rd quarter were relatively low, and the fourth quarter was the peak period for the company's contract signing, project delivery, revenue recognition, and project repayment, and is a critical period for achieving annual business goals.

Equity incentives motivate the team and demonstrate confidence in development. The company issued the “2024 Restricted Stock Incentive Plan (Draft)” in August 2024. It plans to grant restricted shares to a total of 26 people, including senior management and key technical (business) employees, with a total of 3.9 million shares, accounting for 1.93% of the total share capital at the time of announcement. Of these, 3.6 million shares were granted for the first time, and 0.3 million shares were reserved at a grant price of 11.00 yuan/share. The incentive plan assessment year is 2024-2026, based on the company's 2023 net profit. The target values for the 2024-2026 net profit growth rate are 125%/150%/180%, respectively, and the trigger values are 91%/113%/138%, respectively.

Increase research and development of Xinchuang products and implement three major product pilot projects. The company continues to focus on the two main industries of energy, finance and insurance, and actively promotes pilot application projects for Xinchuang EAM, EPM, and ERP, which are progressing smoothly. In terms of ERP, the company optimizes the core engine in general ledger management to achieve further performance improvements; optimizes core functions in asset management to enhance product user experience; optimizes basic capabilities such as cache management and master data management in terms of underlying technology to improve overall system performance; Xinchuang ERP general ledger products have begun to be piloted in the financial insurance industry, and work related to replacing Oracle EBS has been fully initiated. Xinchuang EPM products optimize functions such as budget preparation, budget process, rule calculation, report consolidation, and index management to meet the closed-loop management needs of group enterprise customers from strategy to planning, budget, execution and evaluation. Xinchuang EAM products promote intelligent management of enterprise equipment operation and maintenance. They have successfully entered the HUAWEI CLOUD cloud store, deeply empowering users in various industries to manage intelligent devices.

Make every effort to promote the deepening application of AI technology. The company's next-generation R&D technology platform, Yunhu Platform, is an enterprise-grade PaaS platform software based on cloud-native infrastructure. It is dedicated to building enterprise hybrid cloud application systems, mainly including technology center, data center, and business center, and has expanded intelligent centers, development kits, and integrated kits. In terms of intelligence, the company targets customers and application scenarios, promotes the integration of intelligent assistants and application scenarios, improves user experience, and enhances the level of intelligence of software products. AI Agent technology focuses on advantageous business areas such as financial sharing, overall budget, financial insurance, equipment operation and maintenance, treasury, etc., to enhance the model's special intelligence capabilities in vertical fields, and comprehensively improve enterprise operation efficiency; in addition, for product development and project delivery, the company continuously upgrades iterative AI code assistants to enhance large-scale model training for code generation and improve production efficiency.

Profit forecasting and investment advice. We believe that the company is deeply involved in comprehensive management informatization solutions for large group enterprises, and is progressing smoothly in expanding new strategic customers and deepening product applications, and its performance is expected to grow steadily. The development of digital intelligence in large group enterprises is a long-term trend. We believe, on the one hand, that with the improvement of the macroeconomic environment, the demand for enterprise informatization upgrading and digital transformation will be released at an accelerated pace; on the other hand, with the improvement of the company's products and solutions, the company is expected to seize market opportunities in new fields and open up new growth space. We expect the company's revenue for 2024-2026 to be 0.873/1.046/1.269 billion yuan, up 16.5%/19.8%/21.4% year on year; net profit to mother will be 0.14/0.166/0.196 billion yuan, respectively, up 125.6%/18.1% year on year; EPS 0.69/0.82/0.97, respectively. Referring to comparable companies, the company was given 28-30 times the dynamic PE in 2025, with a reasonable value range of 22.99-24.63 yuan/share. Covered for the first time, it was given an “superior to the market” rating.

Risk warning. Downstream demand falls short of expectations; progress in technology research and development falls short of expectations; market competition intensifies.