Incident: On the evening of October 28, Bossoft released its three-quarter report. The company achieved net profit of 0.035 billion yuan to mother in the first three quarters of 2024, an increase of 93.01% year on year; after deducting non-net profit of 0.023 billion yuan in the first three quarters, an increase of 148.58% year on year.

In Q3, profit and revenue both increased, and operating indicators were steady. According to the company's results announcement, as of 2024Q3, the company achieved net profit of 0.0073 million yuan in a single quarter, an increase of 15.45% year on year; deducted non-net profit of 0.07 billion yuan in a single quarter, an increase of 14.61% year on year. On the revenue side, the third quarter achieved revenue of 0.526 billion yuan, an increase of 10.13% over the previous year. The company's Q3 contract debt was 0.163 billion yuan, up 10.14% year on year. Downstream demand was strong, and there were sufficient on-hand orders.

Keep up with the needs of fiscal and taxation reforms and help with fiscal operation and monitoring. At the press conference held by the State Information Office on October 12, the Ministry of Finance proposed to continuously improve the “Three Guarantees” management system covering budget preparation, budget execution, dynamic monitoring, and emergency response to promote the smooth operation of the “Three Guarantees” at the grassroots level. As an assistant setter of relevant standards and specifications, the company has sufficient first-mover advantage based on “Integrated Budget Management 2.0”, combined with new productivity R&D and digital finance solutions such as data element x and artificial intelligence +. Regarding financial operation monitoring, Boss Software has constructed the Ministry of Finance and is deeply involved in the construction of 12 provincial financial big data and operation monitoring systems to help ensure the steady operation of the country's finances. In the future, investment in construction needs will be prioritized, which will also drive local provinces to bring more market space to the company.

The country's electronic certificate reform is being accelerated to promote the development of the electronic voucher business. Starting November 1, railway passenger transport will promote the use of fully digitized electronic invoices. In terms of obtaining railway e-tickets, the company's electronic voucher products have been adapted to various ways to obtain railway e-tickets, free of download and printing; in terms of authenticity verification, the company's electronic certificate products have been connected to the invoice inspection interface of the State Administration of Taxation and integrated with the Ministry of Finance's electronic certificate toolkit to provide two methods of interface verification and offline inspection; in terms of reimbursement, accounting and filing, the company launched an intelligent electronic voucher service platform that supports paperless processing of the entire process of reimbursement, billing and filing of railway e-tickets. With the implementation of policies relating to the promotion and use of fully digitized electronic invoices for railway passenger transportation, it will facilitate the expansion of the Bosi Software electronic voucher-related business market.

Investment advice: The company's net profit for 24-26 is estimated to be 0.406, 0.506, and 0.612 billion yuan, respectively. The current market value corresponding to 24/25/26 is 32/25/21 times, respectively. Considering the company's leading position in the financial IT field, the company's main business is expected to fully benefit from the subsequent wave of digital government construction and maintain a “recommended” rating.

Risk warning: supply chain risk; core technology upgrade falls short of expectations; policy progress falls short of expectations