Hangzhou EZVIZ Network (688475) Tai Ping Yang·2024-10-15 00:30Investment Rating - The report maintains a "Buy" rating for the company with a target price of 31.23 RMB [1]. Core Views - The company leverages its visual capabilities to build hardware advantages, while AI technology drives the growth of its cloud platform [1][9]. - The company is positioned as a leader in the smart home camera market, addressing privacy concerns that may limit industry growth [27]. - The company is expected to benefit from the increasing consumer trust and market education, allowing it to capture industry growth dividends [27]. Summary by Sections Company Overview - The company emphasizes its dual-core growth driven by visual capabilities and AI technology, evolving from its origins under Hikvision [10][9]. - The ecosystem has evolved to a "2+5+N" model, enhancing its competitive edge in smart home and IoT cloud platform sectors [10]. Financial Analysis - Revenue is projected to grow from 4.84 billion RMB in 2023 to 7.88 billion RMB by 2026, with a compound annual growth rate (CAGR) of approximately 17.5% [3][14]. - The net profit is expected to increase from 563 million RMB in 2023 to 995 million RMB in 2026, reflecting a strong recovery and growth trajectory [3][18]. - The company's cloud platform and overseas business are gaining a larger share of revenue, with the cloud platform's contribution expected to reach 19.15% in 2024H1 [14]. Business Segments - The smart home camera segment is identified as the cash cow, contributing significantly to revenue and profit, while addressing privacy concerns to enhance consumer trust [27]. - The smart door lock market is highlighted as a second growth curve, with the company positioned to capture market share through early investments in facial recognition technology [27]. Cloud Platform - The cloud platform is seen as a core support for revenue and profit growth, with plans to enhance service offerings and increase average revenue per user (ARPU) [14][18]. - The company aims to expand its B-end PaaS offerings to attract new developer users, contributing to high-margin segments [14]. Dividend Policy - The company has maintained a high dividend payout ratio, with a cash dividend rate of approximately 50% in 2023, reflecting confidence in future growth [25][26]. Market Potential - The smart home market is projected to grow rapidly, with a CAGR of 28.23% from 2022 to 2025, indicating significant opportunities for the company [8][22]. - The company is focusing on personalized smart home solutions, with a strong emphasis on AI capabilities to enhance user experience [22].