GLODON(SZ:002410)2024-08-02 06:30Investment Rating - The investment rating for the company is "Buy" with a previous rating of "Buy" as well [1][4]. Core Views - The report highlights that the company has shown resilience in its operations despite a slight decline in revenue and net profit. The management has improved cost control, leading to a significant increase in net profit in the second quarter [4]. - The company's digital cost segment has demonstrated stable revenue growth, with a 4.2% year-on-year increase, indicating improved customer retention and product application rates [4]. - The revenue structure of the digital construction segment is improving, with a focus on standardized project-level products, although overall revenue in this area has decreased by 37.5% [4]. Summary by Sections Financial Performance - In the first half of the year, the company achieved operating revenue of RMB 2.96 billion, a year-on-year decrease of 3.6%, and a net profit attributable to shareholders of RMB 190 million, down 22.7% year-on-year [4]. - The company expects net profits for 2024-2026 to be RMB 670 million, RMB 860 million, and RMB 1.02 billion respectively, with EPS projected at RMB 0.40, RMB 0.51, and RMB 0.61 [4][5]. Revenue Breakdown - The digital cost segment generated revenue of RMB 2.46 billion in the first half, reflecting a 4.2% increase year-on-year. The renewal and application rates for pricing products have improved compared to the previous year [4]. - The digital construction segment reported revenue of RMB 290 million, a decline of 37.5% year-on-year, while the digital design segment generated RMB 40 million, down 22.0% year-on-year [4]. Valuation Metrics - The report provides a valuation with projected PE ratios of 26X, 20X, and 17X for the years 2024, 2025, and 2026 respectively, indicating a potential recovery in profitability [4][5]. - The company’s market capitalization is approximately RMB 17.31 billion, with a three-month average trading volume of RMB 354.43 million [3].