Main points of investment
The company publishes three quarterly reports for 2023. In the first three quarters of 2023, the company achieved operating income of 1.177 billion yuan, an increase of 11.49% over the same period last year, and a net profit of 2 million yuan, down 72.76% from the same period last year.
In a single quarter, the company's 2023Q3 achieved an operating income of 428 million yuan, an increase of 14.37% over the same period last year, and a net profit of 12 million yuan, an increase of 1623.48% over the same period last year, and an increase of 375.92% over the previous year.
The company turned its net profit from loss to profit in a single quarter and ushered in a turning point.
The demand for orders is strong, and overseas business is expected to change. In terms of orders, since 2023, with the release of pent-up market demand due to the epidemic and the rigid demand of Xinchuang, the company's core system demand is strong, and more than 10 orders have been identified for core business systems, far exceeding the average over the years.
In terms of overseas business, the company continues to increase product research and development in overseas business, and the downward movement of the overseas market and the cloud demand on the system are expected to bring jump opportunities to the company's overseas business.
Equity incentives demonstrate the confidence of management. The company passed the equity incentive program in September 2023, and the equity incentive assessment is based on 2022 revenue and net profit. The assessment is divided into two stages, which are not less than 10% of revenue or 20% of net profit growth in 2023 and 2024 respectively. The establishment of the assessment target of equity incentive demonstrates the development confidence of the management.
Private placement will improve the technical level and enhance the anti-risk ability. In October 2023, the company's directional additional issuance project was approved, which raised 572.5863 million yuan, mainly for the construction of financial business system, "Nebula" digital intelligence integration platform and cloud native digital productivity platform, as well as supplementary liquidity. It is expected to further enrich the company's big data business product system, enhance the company's delivery capacity of the business, and consolidate and enhance the company's market position in the field of financial IT solutions. At the same time, this fund-raising will also help the company to optimize its asset and liability structure and enhance its capital strength and anti-risk ability.
[investment advice]
The company is a leading manufacturer of bank IT solutions. Taking into account the economic recovery and the strong demand for innovation of the bank IT system, we estimate that the company's operating income in 2023 and 2024 will be 2265, 27133.16 billion, respectively, and the net profit of homing will be 0.27, 0.79, 0.25 million, respectively, and the EPS will be 0.04, 0.11, 0.17 yuan, respectively, and the corresponding PE will be 273.5, 95.6 and 60.0 times, respectively. Give a rating of "overweight".