Digital China(SZ:000034) Southwest Securities·2024-09-04 05:00Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company reported a revenue of 62.56 billion yuan for the first half of 2024, representing a year-on-year growth of 12.5% - The net profit attributable to shareholders reached 510 million yuan, up 17.5% year-on-year, while the non-recurring net profit was 450 million yuan, reflecting a 6.1% increase [2] - In Q2, the company accelerated its growth with a revenue of 3.33 billion yuan, a 16.9% increase year-on-year, and a net profit of 270 million yuan, up 22.4% year-on-year [2] - The company’s gross margin improved to 4.5%, an increase of 0.75 percentage points year-on-year, while financial expenses rose to 0.8%, up 0.46 percentage points year-on-year [2] Summary by Sections Business Performance - The IT distribution and value-added services segment generated revenue of 598.3 billion yuan, a 9.8% increase year-on-year, with a gross margin of 3.5% [2] - The cloud services and software business saw a significant revenue increase of 62.7%, reaching 1.44 billion yuan, with a total profit of 32.65 million yuan [2] - The self-branded business achieved revenue of 2.66 billion yuan, a 45.5% increase year-on-year, with a gross margin of 10.5% [2] Financial Forecast - The company is projected to have earnings per share (EPS) of 2.08 yuan, 2.48 yuan, and 2.93 yuan for the years 2024, 2025, and 2026 respectively [2][3] - The expected revenue for 2024 is 126.18 billion yuan, with a growth rate of 5.48% [3] - The net profit attributable to shareholders is forecasted to be 1.39 billion yuan in 2024, reflecting an 18.9% growth [3]