Jiuyuan Yinhai(SZ:002777) Haitong Securities·2024-04-06 16:00Investment Rating - The investment rating for the company is "Outperform the Market" and is maintained [1][9]. Core Views - The company reported a stable revenue growth of 5.01% year-on-year, achieving a revenue of 1.347 billion yuan in 2023, while the net profit decreased by 8.83% to 168 million yuan. However, the operating cash flow improved significantly by 401.38% year-on-year to 188 million yuan [4][19]. - The company is focusing on expanding its presence in the smart city sector and has made significant strides in integrating digital solutions for urban governance and services, establishing itself as a leader in this field [5][7]. - The company is expected to benefit from the national push for digital economy development, with projected revenues for 2024-2026 of 1.550 billion, 1.817 billion, and 2.172 billion yuan, representing year-on-year growth rates of 15.1%, 17.2%, and 19.5% respectively [7][19]. Financial Performance - In 2023, the company's revenue from the medical insurance sector was 707 million yuan, a year-on-year increase of 15.07%, accounting for 52.49% of total revenue. The gross margin for this segment was 45.20%, down 12.66 percentage points [18]. - The digital government business generated 550 million yuan, a decrease of 7.48% year-on-year, while the smart city business saw a significant increase of 62.81% to 68 million yuan [18]. - The company’s gross margin for 2023 was 47.61%, down from 55.24% in 2022, indicating a decline in profitability [4][19]. Valuation - The company is valued using both PE and PS methods, with a projected dynamic PE of 45-50 times for 2024, resulting in a reasonable value range of 22.95-25.50 yuan per share [20]. - The PS valuation method suggests a dynamic PS of 6-7 times for 2024, leading to a reasonable value range of 22.79-26.58 yuan [8][20]. - The combined valuation indicates a reasonable value range of 22.95-25.50 yuan, maintaining the "Outperform the Market" rating [9].