Construction software development and application leader, building information + intelligent site business growth is excellent. The company focuses on the field of construction information, mainly building information software and intelligent construction site business. The company's building information software is divided into two series: construction and cost, which respectively provide standardized software products for the whole process of construction and cost calculation, among which the construction safety calculation software is the company's leading product. including domestic industries, local building code requirements, outstanding performance, well-known in the industry. Smart site products provide customized intelligent management and control solutions for the site through "platform + component" services. In recent years, with the continuous attention to the construction information industry in China, the gradual improvement of the company's product chain and the strengthening of market development, the company's revenue and performance have shown a trend of rapid growth. In the past three years, revenue has increased by 53%, 28% and 34% respectively. The performance increased by 67%, 33%, 32%, respectively, showing a good growth ability.

The space of building informatization is broad, and the digitization of construction is expected to lead the third reform. The space of the construction industry is large, but the production efficiency is low. With the application of new technologies such as big data, cloud computing, Internet of things and artificial intelligence during the 14th five-year Plan, building informatization in China is expected to accelerate. The domestic construction industry has completed two rounds of information reform, the first round is the "drawing board" project in the 1990s, the building drawing has changed from hand drawing to computer drawing, and the second round is the informationization of the cost link after 2008. at present, with the accelerated application of BIM and other new technologies in the project, China's construction industry is gradually moving towards the construction link information stage, and the third round of construction information reform is gradually carried out. Among them, construction safety is the core of construction informatization, traditional construction is difficult to achieve fine management and control in terms of safety and progress, and poor management will cause safety accidents, delayed delay and other problems. In recent years, China continues to strengthen construction safety supervision, construction safety information management and control demand is growing rapidly, we estimate that the relevant market scale can reach 20 billion yuan, the space is broad. The information faucet with core technology and integrated system delivery capability is expected to benefit.

The expert in the field of construction safety, the algorithm engine is in the lead. The company is an expert in the field of construction, construction safety Know-how reserves are abundant, forming a strong technical barrier. In the aspect of software development, the company's construction safety algorithm engine integrates huge and complicated national and local standards, and thousands of calculation models have been formed through iterative optimization of a large number of construction projects for many years. Each local code version can be arbitrarily switched and selected to meet the safety calculation needs of most temporary facilities at construction sites all over the country, and the overall solution of each sub-item is formed in the way of modules, which has strong market competitiveness.

In terms of technology application, the company's intelligent site products have outstanding customization capabilities for different application scenarios and customers. Compared with the current mainstream intelligent site products in the market, the company has a leading advantage in algorithm speed, extensibility, recognition rate and so on.

Regional development, "cloud + end" transformation, intelligent site extension to drive growth. 1) Regional market development, the company has gradually expanded from Zhejiang Province to Jiangsu, Shanghai, Hubei, Guangdong and other key regions, the national market continues to open up, and the distribution channels outside the province are gradually turned into direct sales, which is expected to significantly increase the company's revenue volume. 2) the "cloud + end" compresses the pirated space, and the company actively promotes the transformation of the "cloud + end" business model, which is expected to reduce the living space of pirated software, turn the existing customers into long-term stable paying users, and promote the steady growth of the company's sales. 3) the intelligent site business is extended, and the company's intelligent site business has design properties. with the continuous accumulation of data in the future, it can help the company to continuously improve the richness and diversity of intelligent site products, and provide accurate scheme recommendations according to the needs of customers. long-term derivative demand is broad.

Investment suggestion: we predict that the company's return net profit from 2021 to 2023 will be RMB 1.34 million respectively, an increase of 37%, 37%, 35%, respectively, and a CAGR of RMB 2.46, 3.37, 4.55 and 36% for 2020-2023, respectively. The current stock price corresponds to PE of 30-22-16, and PS of 8-6-5. Taking into account the high prosperity of the construction information industry, the company has remarkable advantages in focusing on the field of construction safety and is expected to show excellent growth, we give the company a target market capitalization of 7.3 billion yuan in 2021 (corresponding to 40 times the target stock price of PE), in 2022), giving a "buy" rating for the first time.

Risk hint: some software rely on overseas development platform risk, national market development is not as expected risk, tax preferential policy change risk, construction industry prosperity decline risk and so on.