Topsec(SZ:002212) EBSCN·2025-05-06 07:16Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 7.21 CNY per share [6]. Core Insights - The company reported a revenue of 2.82 billion CNY for 2024, a decrease of 9.73% year-on-year, but achieved a net profit of 83 million CNY, marking a turnaround from losses [1]. - The cloud computing segment is emerging as a second growth curve, with revenue from this business increasing by 10.09% year-on-year to 256 million CNY, while the network security business saw a decline of 11.49% to 2.55 billion CNY [1]. - The company has implemented cost control and quality improvement measures, resulting in a gross margin increase of 0.85 percentage points to 61.04% in 2024 [2]. - The company is focusing on AI integration in its products, enhancing its capabilities in AI security and cloud security, and has signed a memorandum of understanding with Huawei to further its development in this area [3]. Revenue and Profit Forecast - The forecast for net profit has been adjusted downwards for 2025 and 2026 to 179 million CNY and 248 million CNY, respectively, reflecting a reduction of 50.0% and 39.5% [4]. - The projected revenue for 2025 is 3.11 billion CNY, with a growth rate of 10.23%, followed by 3.49 billion CNY in 2026 and 3.92 billion CNY in 2027 [5]. Financial Metrics - The company’s gross margin is expected to remain stable around 59.6% to 61.0% over the next few years, with a projected return on equity (ROE) increasing from 0.9% in 2024 to 3.1% in 2027 [11]. - The price-to-earnings (P/E) ratio is projected to decrease from 102 in 2024 to 28 in 2027, indicating an improving valuation as profitability increases [12].