Event: On January 22, the company released its 2023 performance forecast. The company's performance in 2023 is also rising: net profit attributable to shareholders of listed companies is expected to be 70 million yuan to 80 million yuan, an increase of 1,463.19% to 1,686.50% over the same period of the previous year; net profit after deducting non-recurring profit and loss of 65,000-750 million yuan, an increase of 252.75%-307.02% over the same period last year, and the performance is in line with expectations.
Profitability continued to recover, and gross margin increased dramatically. 1) On January 22, the company released its 2023 performance forecast. The net profit attributable to shareholders of listed companies is estimated to be 70 million yuan to 80 million yuan, an increase of 1,463.19% to 1,686.50% over the same period last year. The performance is in line with expectations. 2) The company's net profit attributable to shareholders of listed companies increased significantly in 2023. The main reason is that net profit attributable to shareholders of listed companies in 2022 was affected by impairment of goodwill and capital refund expenses in non-operating expenses, which led to a low base. Excluding the effects of the above factors, the company's net profit attributable to shareholders of listed companies grew by about 94.74%-122.56% in 2023.
The payment license was successfully renewed, and monthly turnover increased month-on-month in December. 1) On July 5, 2023, the People's Bank of China published the “Renewal Notice Information for Non-banking Institutions (6th Batch in July 2023)” on its official website. Jialian Payment Co., Ltd .<支付业务许可证> (hereinafter referred to as “Jialian Payment”), a wholly-owned subsidiary of Shenzhen Xinguodu Co., Ltd., received this renewal, license file number:
Z2011244000012, License content: Bank card receipt (nationwide), validity period: June 27, 2022 to June 26, 2027. 2) Jialian Payment Co., Ltd., a wholly-owned subsidiary of the company, continued to cultivate market channels and strengthen compliance operations. Channel costs and expenses declined markedly year-on-year, and the gross margin level of the billing business increased markedly year-on-year. Jialian's payment license was successfully renewed in 2023, and the company's billing business operations gradually improved. With the mass shipment of Jialian Payment's billing product line in the fourth quarter, monthly turnover increased sequentially in December.
AI multi-modal technology has been cultivated for many years, and breakthroughs have been made in product lines at home and abroad. 1) According to the announcement, the company continued to increase resource investment in the field of artificial intelligence, and its participating subsidiaries successfully launched a variety of popular applications in overseas markets, driving the company's investment income to increase year-on-year. 2) PiCSO is an AI image generation tool launched by the company in the fourth quarter of 2022. Users only need to enter a text description in the text box and select the desired image style to generate high-quality images, which greatly reduces the barriers to using cutting-edge artificial intelligence technology.
3) The FaceMagic app uses artificial intelligence to allow faces to be replaced in videos of one's choice, and was released in May 2021. The app has received over 1 million downloads since its launch. 4) The company also co-funded the establishment of Shanghai Shiyi District Information Technology Co., Ltd. with Shanghai Weisha Network Technology Co., Ltd., to set up an artificial intelligence research team, carry out research and development of General Purpose AIAgent (General Purpose AIAgent) technology, develop multi-modal AI products, and explore various solutions that enable AI technology to operate efficiently, which will bring new business growth opportunities to the company.
Maintain a “buy” rating. According to key assumptions, revenue for 2023-2025 is estimated to be $4,070 billion, $4.610 billion and $5.257 billion, respectively, and net profit to mother of $761 million, $928 million, and $1,111 million respectively, maintaining the “buy” rating.
Risk warning: Core product revenue falls short of expectations; financial supervision is strengthened; new product promotion falls short of expectations; core assumptions fall short of expectations.