Hylink(SH:603825) China Post Securities·2024-03-24 16:00Investment Rating - The investment rating for the company is "Buy" and is maintained [8]. Core Insights - The company is expected to achieve a significant improvement in its cost structure, leading to a potential turning point in performance. The relocation to Changsha aims to create a digital cultural tourism ecosystem, leveraging AI video and music technologies to unlock growth potential, combining performance recovery with new business growth [18]. Company Overview - Total shares outstanding/float shares: 253 million [3] - Total market capitalization/float market capitalization: 3.3 billion [4] - 52-week high/low price: 16.71 / 6.92 [5] - Debt-to-asset ratio: 75.4% [6] - Price-to-earnings ratio: -5.05 [7] - Major shareholder: Su Tong [8]. Financial Performance - The company forecasts a net profit attributable to shareholders of -4.92 million in 2023, with a projected recovery to 0.50 million in 2024 and 0.85 million in 2025 [18]. - Expected revenue for 2023-2025: 6.318 billion, 8.557 billion, and 10.294 billion respectively, with growth rates of -25.71%, 35.43%, and 20.31% [13]. - The company anticipates an EPS of -1.94 in 2024 and 0.33 in 2025 [18]. Business Strategy - The company has undergone a restructuring of its marketing workflow, integrating AI capabilities to enhance efficiency and creativity in content generation [10]. - The launch of AI tools such as Suno V3 and the marketing assistant Kimi aims to improve data analysis and content creation, thereby reducing costs and increasing responsiveness [17]. - The company is collaborating with cultural institutions to merge traditional artifacts with modern art, enhancing its digital cultural tourism offerings [18].