Investment Rating - The report maintains a "Buy" rating for Mingyuan Cloud with a target price of HKD 2.65 per share [1] Core Views - Mingyuan Cloud's 24H1 revenue decreased by 5.5% YoY to RMB 720 million, with a net loss of RMB 115 million and an adjusted net loss of RMB 17 million [1][2] - The company's gross margin improved by 0.4 percentage points YoY to 80.2% [2] - Cloud services revenue declined by 3.6% YoY to RMB 610 million, accounting for 88.5% of total revenue [1][2] - The company has a strong cash position with RMB 4.36 billion in cash and cash equivalents, and no bank financing [2] Business Segments Cloud Services - Customer Relationship Management (CRM) revenue decreased by 6.0% YoY to RMB 440 million, with a 9.1% decline in the number of sales offices [2] - Project Construction revenue increased by 4.9% YoY to RMB 60 million, driven by higher ARPU [3] - Asset Management & Operations revenue grew by 30.5% YoY to RMB 46 million, with a customer retention rate of 94% [3] - Tianji PaaS platform revenue decreased by 12.0% YoY to RMB 62 million, but the platform has been fully adapted for domestic use and integrated with AI capabilities [4] ERP Solutions - Localized deployment software and services revenue declined by 15.1% YoY to RMB 108 million, reflecting cautious IT spending by private residential developers [4] Strategic Initiatives - The company is focusing on deepening relationships with high-quality state-owned enterprise (SOE) clients and leveraging AI to upgrade products [5] - Mingyuan Cloud is expanding internationally, with initial breakthroughs in Southeast Asia and plans to establish local teams in Malaysia and Hong Kong [5] - The company is implementing cost-saving measures and improving operational efficiency [5] Financial Projections - Revenue for 2024-2026 is projected to be RMB 1.59 billion, RMB 1.593 billion, and RMB 1.629 billion, respectively [6] - Adjusted net profit is expected to turn positive in 2024 and continue to improve in 2025 and 2026 [6] - The company's gross margin is forecasted to increase as SaaS revenue grows, with further optimization of expense ratios [6] Valuation - The report values Mingyuan Cloud at 3x PS for 2024, based on comparable SaaS companies such as Adobe, Salesforce, Kingdee, and Glodon [6] - The target price of HKD 2.65 per share reflects the company's improving business structure and strong cash position [6]
明源云：业务结构改善，持续减亏，发力海外