Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 13.85 [2][5]. Core Insights - The company's revenue for 2023 was CNY 7.891 billion, a year-on-year increase of 2%, with traditional business revenue declining by 3.4% [2]. - New business segments, referred to as "three new businesses," generated CNY 2.9 billion, reflecting a year-on-year growth of 12.7% [2]. - The gross profit margin decreased to 37.7%, while the overall gross profit increased by 1.2% to CNY 2.975 billion [2]. - The adjusted net profit for 2023 was CNY 8.51 billion, maintaining a net profit margin of 10.8% [2][5]. - The company plans to distribute a special dividend of HKD 0.412 per share, which is 40% of the adjusted annual profit [2]. Summary by Sections Business Overview - The company operates in the application software industry and was established in July 2003, with a registered capital of HKD 10,000 and 13,235 employees [2]. Financial Performance - The traditional business, primarily based on BSS, generated CNY 4.991 billion, down 3.4% year-on-year, while BSS revenue alone was CNY 4.881 billion, a decrease of 0.9% [2]. - The three new business segments include OSS, digital operations, and vertical industry digitization, with OSS revenue growing by 24.9% to CNY 0.832 billion [2][3]. Future Outlook - The company anticipates continued pressure on BSS revenue due to reduced capital expenditure from telecom operators, but expects opportunities from system restructuring and intelligent upgrades [2][3]. - OSS revenue is projected to grow by at least 20% next year, driven by advancements in AI and network technologies [3]. - The vertical industry digitization business is expanding rapidly, with significant projects in energy and transportation sectors [4]. Strategic Developments - The company is undergoing a transformation strategy, shifting from a pure telecom service provider to a more diversified model that includes non-telecom services and international market expansion [4]. - The focus on "standard products + solutions" aims to enhance market penetration and operational efficiency [4]. Valuation Metrics - The expected revenue for 2024 and 2025 is CNY 8.32 billion and CNY 9.009 billion, respectively, with corresponding net profits of CNY 9.04 billion and CNY 9.89 billion [5]. - The current price corresponds to a projected P/E ratio of 6.87 for 2024, significantly lower than the industry average [5][6].
三新業務引領增長，四個轉變推動盈利