5i5j(SZ:000560) Southwest Securities·2024-05-10 11:00Investment Rating - The report assigns a "Buy" rating for the company with a target price of 2.40 CNY, indicating a potential upside from the current price of 1.90 CNY [44][54]. Core Insights - The company has shown a steady revenue growth of 3.6% in 2023, achieving a total revenue of 12.09 billion CNY, despite facing a net loss of 850 million CNY due to non-operational and one-time factors [37][44]. - The company is focusing on digital transformation, with significant increases in R&D investment, reaching 40.1 million CNY in 2023, which has enhanced operational efficiency and customer engagement [54][6]. - The asset management business has demonstrated strong performance, with revenue growth of 1.9% in 2023, and a stable rental rate of 96.4% [46][3]. Summary by Sections 1. Business Performance - The company achieved a revenue of 12.09 billion CNY in 2023, with a CAGR of 2.5% from 2018 to 2023 [37]. - The brokerage business revenue increased by 15.9% to 4.09 billion CNY in 2023, with a gross margin improvement of 3.4 percentage points to 20.2% [45]. - The asset management segment reported a revenue of 5.76 billion CNY, with a total transaction value (GTV) of approximately 169 billion CNY [46]. 2. Financial Metrics - The company’s operating cash flow was robust, amounting to 4.67 billion CNY in 2023, reflecting an 8.4% year-on-year increase [39][44]. - The asset-liability ratio stood at 70.5% by the end of 2023, indicating a stable financial condition [39][44]. - The gross margin improved to 9.5% in 2023, showing signs of recovery as the industry stabilizes [39][44]. 3. Digital Transformation - The company has significantly increased its R&D spending, which has facilitated a comprehensive upgrade in service delivery through digital solutions [54][6]. - The proportion of mobile users has risen, with online listings accounting for 14.5% of total transactions in 2023 [54][6]. 4. Market Position - The company has maintained a strong market presence, particularly in core cities, with a market share increase in Shanghai [45]. - The total number of operational stores decreased to 2,853 in 2023, with a focus on enhancing the efficiency of direct operations [61].