Core Insights - The report highlights the significant growth in revenue for the company, with a 14.50% increase in 2024, reaching 547 million yuan, despite a decline in net profit by 37.68% to 80 million yuan [2][5] - The company is expected to benefit from the increasing demand for domestic products in the context of integrated circuit localization [2][5] - The first quarter of 2025 showed a remarkable revenue increase of 51.43%, amounting to 66 million yuan, indicating a positive trend in cash flow performance [6] Revenue Breakdown - The company's software development and licensing revenue surged by 70.33% in 2024, totaling 159 million yuan, accounting for 29.04% of total revenue [7] - Testing equipment and accessories generated 386 million yuan, a 0.63% increase, representing 70.67% of total revenue [7] - Testing services and other revenues saw a dramatic increase of 360.63%, reaching 1.62 million yuan, contributing 0.30% to total revenue [7] Market Trends - The semiconductor demand is expected to rise due to advancements in AI technology, which will likely enhance the market share of domestic EDA companies [8] - The report notes a recovery in China's integrated circuit industry, with domestic products gaining market share in consumer electronics and communications [8] - The emphasis on localization and domestic procurement strategies is anticipated to further boost demand for local EDA products [8] Product Development - In 2024, the company made significant advancements in its EDA functionalities and launched several new products, including the INF-AI platform and the SemiMind semiconductor model platform [9] - The company has also developed a new high-performance semiconductor parameter testing machine, expanding its testing capabilities [9] - The successful implementation of yield improvement projects for various clients has enhanced the company's reputation and potential in the market [9]

Investment Rating - The report maintains a "Buy" rating for the company, with a market price of RMB 50.30 and an industry rating of "Outperform" [1][4][6]. Core Insights - The company is expected to benefit from the increasing demand for domestic products in the context of integrated circuit self-sufficiency, leading to significant growth in its software business revenue in 2024 [1][4]. - The company reported a revenue of RMB 547 million in 2024, a year-on-year increase of 14.5%, while the net profit attributable to the parent company decreased by 37.68% to RMB 80 million [4][8]. - The first quarter of 2025 showed a revenue increase of 51.43% year-on-year, amounting to RMB 66 million, with a narrowing loss compared to the previous year [9]. Financial Performance Summary - The company’s revenue projections for 2025-2027 are RMB 684 million, RMB 861 million, and RMB 1,094 million, respectively, with a compound annual growth rate (CAGR) of 25% [6][8]. - The net profit attributable to the parent company is expected to recover to RMB 148 million in 2025, with further growth to RMB 190 million in 2026 and RMB 253 million in 2027 [6][8]. - The earnings per share (EPS) are projected to be RMB 0.74 in 2025, RMB 0.95 in 2026, and RMB 1.26 in 2027, reflecting a significant recovery from the previous year's decline [6][8]. Business Segment Performance - The company has diversified its offerings into EDA software and hardware testing equipment, with software development and licensing revenue reaching RMB 159 million in 2024, a substantial increase of 70.33% [9]. - The hardware testing equipment and accessories segment generated RMB 386 million in revenue, a slight increase of 0.63%, while the testing services and other business segments saw a remarkable growth of 360.63% [9]. Market Trends and Opportunities - The domestic EDA market is expected to grow due to the increasing demand for semiconductor products driven by advancements in AI and local procurement strategies [9]. - The company is positioned to capture market share as the U.S. imposes restrictions on certain EDA software, which may benefit domestic EDA manufacturers [9].