Investment Rating - The report maintains an "Outperform" rating for the company [6] Core Views - The company's SaaS business revenue increased by 30% YoY, with strong growth in both SMB and KA segments [4] - The company achieved a revenue of RMB 739 million in 24H1, a 26.7% YoY increase, with SaaS business revenue reaching RMB 400 million, up 30.4% YoY [6] - The company's adjusted net profit turned positive to RMB 48 million in 24H1, compared to a loss of RMB 24 million in the same period last year [6] - The marketing and sales SaaS market has a potential market size of RMB 4.3 trillion by 2027, with significant room for penetration [6] Financial Performance - The company's revenue for 24H1 was RMB 739 million, with a gross profit of RMB 393 million, up 22.3% YoY [6] - SaaS business gross margin improved by 1.2 percentage points to 88.3% in 24H1 [6] - The company's revenue is expected to grow to RMB 1.508 billion, RMB 1.990 billion, and RMB 2.702 billion in 2024, 2025, and 2026, respectively, with YoY growth rates of 22.4%, 31.9%, and 35.8% [6][7] - Net profit is forecasted to be -RMB 108 million, -RMB 58 million, and RMB 18 million in 2024, 2025, and 2026, respectively [6][7] Market Position and Strategy - The company is the largest marketing and sales SaaS solution provider in China by 2023 revenue [6] - The company focuses on SMB as its primary growth curve and KA as its secondary growth curve, with significant partnerships established with major enterprises such as Weichai Power, Chery Automobile, and Meituan [4] - The company's user base grew by 13.1% YoY, with average revenue per user per month increasing by 16.5% [4] Valuation and Forecast - The company's reasonable market value is estimated to be between RMB 25.64 billion and RMB 27.15 billion, with a target price range of RMB 109.03 to RMB 115.44 per share [6] - The company's PS ratio is projected to be 17-18x for 2024, based on a revenue forecast of RMB 1.508 billion [6] Industry Comparison - The company's PS ratio is comparable to industry peers such as Kingsoft Office, SERVICENOW, and ADOBE, with an average PS ratio of 17x for 2024 [8]

Investment Rating - The report assigns an "Outperform" rating to the company, with a target price range of 109.03-115.44 RMB per share (118.51-125.48 HKD per share) based on a 2024 dynamic PS of 17-18x [3][4] Core Investment Thesis - The company is a leading marketing and sales SaaS provider in China, with a comprehensive product portfolio and strong sales network serving both SMB and large enterprise (KA) customers [3][6] - The SaaS business is expected to grow rapidly at 28%/40%/45% in 2024-2026, driven by product optimization, AI adoption, and KA expansion [3] - Precision marketing services are forecast to grow steadily at 15%/20%/20% in 2024-2026 as the economy recovers [3] - Overall gross margin is projected to improve to 58.8%/60.9%/63.1% in 2024-2026 due to the higher-margin SaaS business gaining share [3] Business Overview - The company operates the Marketingforce platform, which integrates technology infrastructure, data middleware, and SaaS products with 237 functional modules covering the entire marketing and sales process [6] - It offers two flagship SaaS products - T Cloud for marketing and Zhenke for sales, which can be customized by combining different functional modules [6] - SaaS revenue grew at a 47.13% CAGR from 2019 to 2023, reaching 702 million RMB, with the number of users increasing to 25,495 and average contract value per user rising to 51,238 RMB [19] Financial Projections - Total revenue is forecast to grow 22.4%/31.9%/35.8% to 1.51/1.99/2.70 billion RMB in 2024-2026 [3][11] - Net loss is expected to narrow from -108 million RMB in 2024 to -58 million RMB in 2025, turning profitable at 18 million RMB in 2026 [3][11] - SaaS business is projected to contribute 58.8%/60.9%/63.1% of total revenue in 2024-2026, up from 57.0% in 2023 [11][18] Industry Outlook - The marketing and sales SaaS market in China grew at a 29.7% CAGR from 2018 to 2022, reaching 20.6 billion RMB, and is expected to expand to 74.5 billion RMB by 2027 at a 29.3% CAGR [9] - Compared to back-office SaaS solutions like HR and supply chain management, companies are more willing to pay for marketing and sales SaaS as it directly drives customer acquisition and revenue growth [9]