NEWLAND(SZ:000997) Southwest Securities·2024-04-26 08:00Investment Rating - The report maintains a "Buy" rating for the company with a target price of 21.78 CNY over the next six months [1][10]. Core Insights - The company reported a revenue of 8.25 billion CNY in 2023, representing a year-on-year growth of 11.9%. The net profit attributable to shareholders was 1.00 billion CNY, a turnaround from a loss, with a year-on-year increase of 13.9 billion CNY. The non-recurring net profit reached 1.08 billion CNY, up 136.8% year-on-year [2][12]. - The company's payment services transaction volume grew by approximately 8% to 2.5 trillion CNY in 2023, benefiting from the recovery in domestic consumption and a gradual increase in service fees due to reduced competition [2][10]. - The integration of the acquired company, Shanhai Intelligent, has enhanced the company's SaaS capabilities for merchants, contributing to a significant increase in revenue from merchant value-added services, which grew by 33.6% to 3.88 billion CNY [2][10]. Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 8,249.52 million CNY, with a growth rate of 11.94%. The net profit attributable to the parent company was 1,003.59 million CNY, reflecting a growth rate of 362.91% [3][12]. - The company expects revenues for 2024, 2025, and 2026 to be 9,223.06 million CNY, 10,415.46 million CNY, and 11,786.62 million CNY, respectively, with corresponding growth rates of 11.8%, 12.9%, and 13.2% [9][12]. Business Segments - The electronic payment and recognition business is projected to grow at a rate of 6.2% annually from 2024 to 2026, while the merchant operation and value-added services are expected to see growth rates of 19.6%, 19.4%, and 18.9% in the same period [8][9]. - The company has made significant investments in AI and big data technologies, leading to successful bids for projects with major clients, indicating a promising outlook for future growth in this segment [8][10]. Valuation Metrics - The company is currently trading at a PE ratio of 14 for 2024, which is slightly below the industry average of 15. The expected EPS for 2024, 2025, and 2026 are 1.21 CNY, 1.46 CNY, and 1.71 CNY, respectively [10][12]. - The report suggests that the company's profitability is expected to improve significantly due to cost control measures and enhanced service capabilities, making it an attractive investment opportunity [2][10].