Triple resonance to create a cybersecurity giant. The company was founded in 2010 and listed on the Science and Technology Innovation Board in 2023; in 2024, the company began the strategic 2.0 era of satellite internet, cyberspace maps, and scenario-based security (identity authentication TAG products, etc.). Equity incentives help accelerate marginal revenue. In September 2024, the company issued equity incentives. If the lower assessment target is achieved, we estimate that the 4Q2024 revenue growth rate will reach 32% in a single quarter, which is expected to achieve marginal acceleration.

Cyberspace maps to create special industry reconnaissance equipment for major power games. In the context of the power game, countries are speeding up the construction of cyber forces. In December 2024, top-level inspections of information support forces emphasized the extreme importance of their responsibilities. In 2022, the company launched a cyberspace map, which has functions such as detection, drawing, asset management, countersurveying, and defense, and early warning, which can provide a “map” to indicate the direction of cyberspace games in China.

According to IDC data, the cyberspace map market will reach 5.46 billion yuan by 2026. The company, as the leader in national standard setting, is expected to continue to explore the dual-use military and civilian market and grow rapidly.

The urgency of satellite internet has increased, and the company has laid out a new 10 billion yuan track. The urgency of development has increased, countries have accelerated their seizure of low-orbit air supremacy, and China is catching up with the launch of the three “Ten Thousand Star Constellations.” Security urgency has increased. According to our estimates, under a neutral environment, China's satellite Internet security market space was about 15.1 billion yuan in 2030. The company took the lead and created a comprehensive closed-loop security solution, which is expected to achieve rapid growth.

Online ID cards are expected to be promoted, creating a third growth engine. In July 2024, the Ministry of Public Security, the State Internet Information Office, etc. issued the “Administrative Measures on the National Internet Identity Authentication Public Service (Draft for Comments)”. When logging in to various Internet platforms, users can choose to log in with the Internet License App with one click to avoid platform misuse and disclosure of user privacy. During the pilot phase, 169 apps (such as WeChat, Air Travel Zongheng, etc.) have already been accessed. We believe that by providing identity authentication TAG products, the company is expected to create a third growth pole.

Investment advice: Relying on traditional products to go overseas and advance in three new businesses, the company is expected to start rapid growth.

We expect the company to achieve operating income of 0.356/0.5/0.727 billion yuan and net profit of 0.055/0.086/0.131 billion yuan in 2024-2026. The corresponding PE was 55.74/35.46/23.17 times, respectively, and the rating was raised to “buy”.

Risk warning: Policies falling short of expectations, risk of industry development falling short of expectations, risk of product innovation falling short of expectations, risk of downstream customer repayment falling short of expectations, etc.