Main points of investment

Performance growth is steady, and the growth rate is expected to increase in the second half of the year.

The company's 22H1 revenue is 711 million (+ 7.03%), the net profit is 116 million (+ 5.06%), the non-return net profit is 109 million (+ 2.82%), the Q2 revenue is 460 million (+ 4.5%), the home net profit is 78 million (- 7%), the performance growth is relatively stable, the main reason is: 1) the year-on-year base is higher. 2) the contract signing and project acceptance of some important projects were delayed due to the epidemic prevention and control in the company headquarters and other areas from April to May; with the improvement of the epidemic situation in July and the normal development of the company's business, the growth rate is expected to increase in the second half of the year.

The policy of transport management service platform opens hundreds of billions of markets, and the company as a leader is expected to continue to benefit. 1) clear time point: in March this year, the Ministry of Housing issued the "Circular on comprehensively accelerating the Construction of Urban Operation and Management platform". It is clearly required that by the end of 2022, municipalities directly under the Central Government, provincial capitals, cities separately listed on the State plan and some prefecture-level cities will build urban transport management service platforms, and provincial-level cities with conditions will build provincial-level urban transportation management service platforms. By the end of 2023, all provinces and autonomous regions will have completed provincial-level urban transport management service platforms, and cities at and above the prefectural level will basically build urban transport management service platforms; by the end of 2025, the system and mechanism of "one network integrated management" for urban operation and management will be basically improved, urban operation efficiency and risk prevention and control capabilities will be significantly enhanced, and the level of scientific, refined and intelligent urban governance will be greatly improved.

2) the company has in-depth formulation of industry standards and rich project experience: as the chief editor, the company has undertaken the industry standards "Technical Standard of Urban Operation Management Service platform" and "data Standard of Urban Operation Management Service platform". It has cumulatively undertaken the construction of digital urban management information platforms in more than 200 prefecture-level cities and more than 1000 districts (county-level cities and counties), and accumulated rich experience in urban management information projects.

3) respond quickly and undertake the construction of provincial and municipal platforms: 22H1 has undertaken the construction of urban operation and management service platforms at the provincial (municipal) levels in Hainan, Heilongjiang, Chongqing and dozens of cities and counties, including Jining, Xi'an, Daqing, Baiyin, Shangqiu, Anqing, etc., among which Hainan provincial platform and Jining municipal platform all realize the connectivity of urban management network at departmental, provincial, municipal and county levels.

4) the market size is 100 billion, and the company is expected to benefit: according to the company's semi-annual report, according to the calculation of nearly 300 prefecture-level cities and more than 2800 counties (cities, districts) across the country, the market scale of cloud management service platform is expected to reach 100 billion. The company as a model founder, standard setter and industry builder is expected to continue to benefit in the next three years.

One-net management and metasonic orders are expected to accumulate. "Qiji" grid vehicles help the expansion of urban operation services 22 H1 except for 75 million (- 6.07%) of revenue from integrated services that are seriously affected by the epidemic. Revenue from remotely delivered software and operational services is 295 million (+ 12.76%) and 340 million (+ 5.64%) respectively:

1) one-network management: the company has led the compilation of nine national / industry standards related to gridded urban management, and has undertaken nearly a thousand gridding platforms nationwide, leading the industry in the application of gridding model market share. The construction project of "one network unified management" system in Zhangdian District, Zibo, which was built in the first half of the year, totaled 140 million yuan, building a Zhangdian one network unified management model around the four major areas of urban management, social governance, emergency management and credit system. With the weakening of the impact of the epidemic, it is expected that the company will get more orders in the second half of the year. 2) Meta Universe: the official version of the new generation of "Crystal" digital twin platform created by the company will be released in the near future, and has been applied in many major projects such as Jiangbei District of Chongqing; as of August, the amount of related urban management and social governance projects based on the digital twin platform has reached 430 million yuan.

3) Urban operation: the company keeps the first place in the industry in the market share of big data comprehensive operation services in the gridded city of China. In the first half of the year, the company released a new product "Qiji" self-driving intelligent grid with L4 self-driving capability, which is loaded with a variety of sensing devices. It can identify and intelligently interact with the urban integrated command center to deal with urban governance problems. The 2.0 upgraded car is already in application testing. With the gradual improvement of the relevant road rights opening policy, it is expected that "Qiji" will be applied in more cities to promote the development of operation and business.

Profit forecast

The company's performance is growing steadily, and we believe that with the weakening of the impact of the epidemic and the catalysis of cloud management policy, the government's ability and willingness to spend on urban governance is expected to be repaired, and the company is expected to see an increase in growth in the second half of the year. Revenue for 22-24 is estimated to be 18.46 million, 23.01, 2.890 million respectively (+ 24.70% 24.61, 25.63%), net profit from home is 2.54 million, 310, 381 million, respectively (+ 22.89, 21.94, 23.06), EPS is 0.50, 0.61, 0.75, respectively, maintaining the "Buy" rating.

Risk hint

Downstream customer demand is lower than expected, business and order landing is less than expected, the epidemic is repeated, and competition intensifies.