Incidents:

[1t2A month ble2_8s day UM, m by AR Huayi] The national finals of the Kunpeng Application Innovation Competition hosted by Technology Co., Ltd. were held in Suzhou, Jiangsu. Tianyuan Deco's “5G integrated billing system based on Kunpeng's native development” was a strong finalist with the Shenzhen Gold Award and won the silver medal in the Enterprise Race Operator Circuit Finals.

Reviews:

Establish a digital and intelligent billing system to promote the localization of Xinchuang. The company's “5G integrated billing system based on Kunpeng's native development” is based on the development and implementation of the Huawei Kunpeng console and China Telecom Tianyi Cloud operating system. It aims to build an accurate, efficient, stable and intelligent digital billing system to accelerate the implementation of operators' localization. Since Tianyuan Dike and Huawei officially launched Kunpeng testing in September 2019, they have completed Kunpeng compatibility and mutual certification for multiple applications and obtained Kunpeng's native development technology certification. In the future, the two sides will continue to promote the “HUAWEI Kunpeng as base+Tianyuan Dike industry platform and application” cooperation model, promote transplantation and native development of the company operator industry based on HUAWEI Kunpeng, and jointly address the trends and industry opportunities of Xinchuang localization.

Focus on ICT products and focus on the path of ICT terminal agents. The company is a leading domestic provider of integrated industrial cloud and big data solutions, data and intelligent operation services. The business covers the fields of communications, finance, government and enterprise, ICT product sales, and value-added services. In the communications field, the company's business covers front-end touchpoint applications for the three major telecom operators, capacity building, core support systems, digital capability bases, etc.; in the financial sector, the financial industry general data management platform products developed by the company provide strong support for banks, insurance, trusts, funds and other financial institutions to integrate, store, process and analyze various types of financial data; in the field of government and enterprise, the company uses big data, cloud computing and IoT technology as the core to promote the intelligent upgrading of the government industry. In the ICT product sales sector, benefiting from domestic demand for Xinchuang and computing power infrastructure, as well as the rapid development of the low-altitude economy, the number of orders for Huawei ICT products in the first half of this year increased dramatically compared to the same period last year, and the DJI drone government and enterprise market continued to grow significantly. Jin Huawei, a wholly-owned subsidiary of the company, is the general distributor of Huawei's government and enterprise affairs, the national distributor of hyperfusion, and DJI platform provider. The agent products cover the fields of enterprise networks, enterprise optical transmission and access, storage, data centers, intelligent collaboration, intelligent security, digital energy, etc., providing customers with various solutions. Currently, Huawei has launched system-level large-scale cluster solutions through storage and proxy. Its products include OceanStor series storage servers and Galaxy network switches, and the company is expected to continue to benefit as a gold medal distributor.

Covered for the first time, a “gain” rating was given. I am optimistic that the company will continue to expand in the ICT terminal product agency field and achieve rapid growth in performance. The company is expected to achieve revenue of 7.665/8.828/9.978 billion yuan in 2024-2026, net profit to mother 0.049/0.075/0.106 billion yuan, and corresponding EPS of 0.08/0.12/0.17 yuan, respectively.

Risk warning: goodwill calculation, etc. may affect profit forecasts; downstream customer demand falls short of expectations