Digital China(SZ:000034)2024-11-01 07:41Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook on its performance relative to the market [6]. Core Insights - The company reported a revenue of 91.57 billion yuan for the first three quarters of 2024, representing a year-over-year increase of 8.81%. The net profit attributable to shareholders was 0.894 billion yuan, up 5.04% year-over-year [4][5]. - The company's self-branded product business showed strong growth, with revenue reaching 3.87 billion yuan, a year-over-year increase of 32%. The AI server business saw a remarkable growth of 226% year-over-year [5]. - The company plans to repurchase shares worth 200 to 400 million yuan, which is about 1.39% of its total share capital, reflecting confidence in future growth [6]. Financial Performance Summary - For the first three quarters of 2024, the company achieved a gross margin of 4.49%, an increase of 0.56 percentage points year-over-year. The gross margin for Q3 alone was 4.58%, up 0.19 percentage points year-over-year [5]. - Operating cash flow for the first three quarters was 2.167 billion yuan, a significant increase of 283.9% year-over-year, primarily driven by net profit growth and extended payment terms [6]. - The company forecasts revenues of 124.61 billion yuan, 131.54 billion yuan, and 139.63 billion yuan for 2024, 2025, and 2026 respectively, with net profits projected at 1.403 billion yuan, 1.606 billion yuan, and 1.967 billion yuan for the same years [8].