Investment Rating - The report assigns a "Buy - A" investment rating to the company with a 6-month target price of HKD 8.37, representing a dynamic price-to-sales ratio of 5 times for 2024 [5][8]. Core Insights - The company continues to push forward with its cloud subscription model, achieving a revenue of RMB 2.87 billion in the first half of 2024, marking an 11.9% year-on-year increase, while the loss attributable to equity holders narrowed by 23.2% to approximately RMB 218 million [2][3]. - The cloud service business generated RMB 2.389 billion in revenue, a growth of 17.2% year-on-year, accounting for about 83.2% of total revenue [3]. - The annual recurring revenue (ARR) from cloud subscription services reached approximately RMB 3.15 billion, reflecting a year-on-year increase of 24.2% [3]. - The company is focusing on high-quality operations in the large enterprise market, with significant growth in cloud service revenue from large enterprises and a strong net dollar retention rate of 97% [3][4]. Summary by Sections Financial Performance - The company reported a revenue of RMB 2.87 billion for the first half of 2024, with a gross margin of approximately 63.2%, up 1.3 percentage points year-on-year [2][3]. - The operating profit margin for the medium-sized enterprise segment reached 20%, with a customer base of 42,000 [3]. - The projected revenues for 2024, 2025, and 2026 are RMB 6.527 billion, RMB 7.570 billion, and RMB 8.838 billion, respectively, with net profits expected to turn positive by 2026 [8][11]. Business Segments - The large enterprise segment, including products like Kingdee Cloud Cangqiong and Kingdee Cloud Xinghan, recorded a revenue of approximately RMB 546 million, growing 38.9% year-on-year [3]. - The medium-sized enterprise segment, represented by Kingdee Cloud Xingkong, achieved a revenue of approximately RMB 1.054 billion, with a year-on-year growth of 14.3% [3]. - The small and micro enterprise segment, through Kingdee Cloud Xincheng, saw a revenue increase of 17.3% year-on-year, with a notable 70.8% growth in Kingdee Cloud Jingdouyun [3]. Market Position and Strategy - The company is recognized as a leading player in the domestic ERP industry, focusing on subscription transformation to drive future growth [8]. - The introduction of AI capabilities through the Kingdee Cloud Cangqiong platform aims to enhance enterprise management and support Chinese companies in their global expansion efforts [4][8].
金蝶国际：云订阅持续推进，高质量经营大企业市场