China Bester (603220) Huaxin Securities·2025-05-11 02:05Investment Rating - The report assigns a "Buy" rating for the company, marking it as the first recommendation [1]. Core Insights - The company's main operations are stable, and its computing power business is beginning to gain momentum [1]. - In 2024, the company achieved a revenue of 2.984 billion yuan, with a year-on-year growth of 4.28%, and a net profit attributable to shareholders of 145 million yuan, growing by 0.66% [4]. - The first quarter of 2025 saw a revenue drop to 549 million yuan, a decrease of 24.67% year-on-year, and a net profit of 19 million yuan, down 59.49% year-on-year [4]. Summary by Sections Market Performance - The company's stock price is currently at 23.26 yuan, with a total market capitalization of 10.1 billion yuan and a total share count of 434 million [1]. Financial Performance - The first quarter performance was impacted by delays in equipment delivery and the ramp-up of production capacity, leading to a decline in revenue and profit [5]. - The computing power segment reported a revenue of 269 million yuan in 2024, accounting for 9.02% of total revenue, with a staggering year-on-year growth of 3,696.16% and a gross margin of 41.04% [6]. - In the first quarter of 2025, the computing power business generated 135 million yuan, reflecting a year-on-year increase of 972.79% [6]. Business Development - The company has established a nationwide layout for its intelligent computing centers, with several clusters already operational [6]. - The 5G infrastructure and new energy businesses are driving growth, with significant contracts won in international markets and a strategic partnership in the new energy sector [9]. - The company has secured a total of 1.088 billion yuan in contracts for the 2025-2026 telecommunications engineering construction services [9]. Earnings Forecast - Revenue projections for 2025-2027 are 3.432 billion yuan, 3.964 billion yuan, and 4.499 billion yuan, respectively, with corresponding EPS of 0.48 yuan, 0.68 yuan, and 1.03 yuan [10]. - The current stock price corresponds to a PE ratio of 48.7 for 2025, 34.2 for 2026, and 22.5 for 2027, indicating a positive outlook for the company's computing power business and growth potential [10].