XGD(SZ:300130) Guohai Securities·2024-09-27 08:08Investment Rating - The report initiates coverage with a "Buy" rating for the company, indicating a positive outlook on its future performance [7]. Core Insights - The company has established a comprehensive layout in "payment + terminal + AI," achieving a compound annual growth rate (CAGR) of 24.94% in net profit attributable to shareholders from 2018 to 2023 [4]. - In 2023, the company reported revenue of 3.801 billion yuan, a year-on-year decrease of 12%, while the net profit attributable to shareholders reached 755 million yuan, reflecting a significant increase of 1586% year-on-year [4][8]. - The report highlights the recovery of the company's acquiring business and the gradual realization of pricing benefits, with projected revenues of 3.950 billion yuan, 4.529 billion yuan, and 5.239 billion yuan for 2024, 2025, and 2026 respectively [7][8]. Summary by Sections Company Overview - Founded in 2001, the company initially focused on POS hardware production and sales, later expanding through acquisitions to cover payment, terminal, and AI sectors [13]. - The company has made significant strides in overseas markets, with 4.464 million units shipped in 2023, marking a year-on-year increase of 48.63% [6][11]. Revenue Analysis - The company's revenue from the acquiring business in 2023 was 2.583 billion yuan, accounting for 68% of total revenue, while electronic payment device revenue was 993 million yuan, making up 26% [4][16]. - The report anticipates a stabilization in revenue, with the acquiring business expected to recover following the successful renewal of payment licenses [5][36]. Profitability - The company achieved a record high net profit of 755 million yuan in 2023, with a CAGR of 24.94% from 2018 to 2023 [17]. - The gross margin for the company improved to 43.17% in the first half of 2024, indicating a positive trend in profitability [17][18]. Industry Context - The report notes a significant reduction in the number of payment licenses, which has led to a more favorable competitive environment for the company [5][26]. - The average acquiring fee in China is currently at 0.6%, which is significantly lower than the 2%-3% seen in developed countries, suggesting potential for upward adjustment in fees [23][24]. Future Outlook - The company is expected to benefit from the recovery of offline consumption and the gradual increase in acquiring fees, which could enhance profit margins [30][34]. - Projections indicate that the company will continue to expand its market presence, particularly in overseas markets, while also developing its AI capabilities [6][7].