Investment Rating - The report gives a "Buy" rating for the company, marking the first coverage [1][3]. Core Insights - The company is a leading digital technology service provider in China, primarily serving major clients like Huawei, Tencent, Baidu, and Alibaba. In 2023, the company reported revenue of 17.581 billion yuan, a decrease of 7.97% year-on-year, and a net profit of 534 million yuan, down 45.15% year-on-year, attributed to global economic downturns and insufficient market demand [2][10]. - The upcoming year 2024 is anticipated to be significant for the HarmonyOS ecosystem, with the release of HarmonyOS NEXT and a growing number of applications being developed for it. The company is positioned as a key partner in this ecosystem [2][24]. - The acquisition of Tongfang has strengthened the company's capabilities in hardware and software integration, enhancing its competitive edge in the market [3][10]. Summary by Sections 1. Company Overview - The company is a top digital technology service provider in China, offering a range of services including general technology services, digital technology services, consulting, and digital operations. It has established partnerships with major tech firms [2][10]. - The company has seen a steady increase in revenue from Huawei, growing from 4.344 billion yuan in 2018 to 6.437 billion yuan in 2023, making it Huawei's largest digital technology service provider [2][10]. 2. HarmonyOS Development - The report highlights that 2024 will be a pivotal year for the HarmonyOS ecosystem, with significant technological advancements and product launches expected. The HarmonyOS NEXT is set to be released in Q4 2024, enhancing the system's performance and security [2][24]. - The market potential for HarmonyOS is vast, with estimates suggesting a market size of 183 billion yuan for PC operating systems and 200 billion yuan for mobile application development [2][32]. 3. Strategic Acquisitions - The acquisition of Tongfang has allowed the company to integrate computing power and software solutions, enhancing its product offerings and market competitiveness [3][10]. - The company is also focusing on various Huawei products, including Euler and Gauss, to diversify its service offerings and improve its market position [2][10]. 4. Financial Projections - The report projects the company's net profit to reach 714 million yuan in 2024, 925 million yuan in 2025, and 1.118 billion yuan in 2026, indicating a positive growth trajectory [1][3].
软通动力：鸿蒙大年来临，软硬件一体领军有望崛起