Sinnet(SZ:300383) HTSC·2025-08-28 08:33Investment Rating - The investment rating for the company is maintained at "Buy" [1][4]. Core Views - The company experienced a slight decline in revenue and a significant drop in net profit in the first half of 2025, primarily due to the expiration of specific operational assets related to Amazon Cloud and adjustments in client strategies [1][2]. - New data center projects in Tianjin and Shanghai are progressing well, and the company is actively investing in intelligent computing centers in Inner Mongolia, which are expected to contribute positively to future earnings [1][3]. - The company is embracing opportunities in the AI sector, having signed a strategic cooperation agreement to enhance its capabilities in AI applications [3]. Summary by Sections Financial Performance - In the first half of 2025, the company achieved revenue of 3.716 billion RMB, a year-on-year decrease of 5.15%, and a net profit of 115 million RMB, down 57.01% [1]. - The data center business generated revenue of 1.071 billion RMB, a decline of 2.08%, while the cloud computing segment reported revenue of 2.57 billion RMB, down 7.67% [2]. Profitability - The gross margin for the first half of 2025 was 15.16%, a decrease of 1.50 percentage points, attributed to the reduction in cloud computing revenue and increased depreciation expenses [3]. - Future profitability is expected to improve as new data center projects are delivered and operational [3]. Valuation and Forecast - The estimated EBITDA for 2025 to 2027 is projected to be 1.415 billion, 1.648 billion, and 1.882 billion RMB, respectively [4]. - The target price for the company's stock is set at 18.87 RMB, based on an EV/EBITDA multiple of 25.5x for 2025 [4].