Yusys Technologies(SZ:300674) Guotai Junan Securities·2024-03-31 16:00Investment Rating - The investment rating for the company is "Accumulate" with a target price of 19.26 CNY, down from the previous target of 24.43 CNY [2][3]. Core Views - The company has experienced significant revenue growth driven by its integration business, but this growth may not be sustainable in the long term. The overseas business is expected to be a key growth driver in the future [2][3]. - The company reported total revenue of 5.204 billion CNY in 2023, a year-on-year increase of 21.45%, with a net profit of 326 million CNY, reflecting a 17% increase [2][3]. - The cash flow from operations improved significantly, with a net cash flow increase of 155%, reaching 447 million CNY [2][3]. Summary by Sections Financial Performance - The company achieved total revenue of 5.204 billion CNY in 2023, up 21.45% year-on-year, and a net profit of 326 million CNY, up 17% [2][3]. - The integration business saw a revenue increase of 77.47% year-on-year, primarily due to large orders from clients like CITIC Bank [2][3]. - The company forecasts earnings per share (EPS) of 0.53 CNY for 2024, 0.70 CNY for 2025, and 0.81 CNY for 2026 [2][3]. Business Outlook - The integration business is expected to face challenges in sustaining its growth, which may impact apparent revenue growth in the future. However, profitability is not expected to be significantly affected [2][3]. - The company is actively expanding its overseas business, which is anticipated to become a major growth point due to higher profit margins compared to the domestic market [2][3]. Valuation Metrics - The company’s price-to-earnings (PE) ratio is projected to decrease from 28.73 in 2023 to 24.93 in 2024, indicating a more attractive valuation [2][3]. - The net asset return (ROE) is expected to improve from 7.9% in 2023 to 8.6% in 2024, reflecting enhanced profitability [2][3].