Core Viewpoint - The report from BOC International maintains the earnings per share forecast for China Software International (00354) for this year but raises the forecasts for 2026 and 2027 by 5% and 6% respectively, reflecting accelerated AI revenue growth and the nationwide penetration of the HarmonyOS IoT [1] Group 1: Earnings Forecast and Valuation - The target price for China Software International has been raised from HKD 5.6 to HKD 7.6 based on a 20x price-to-earnings ratio for 2026 [1] - The company’s performance in the first half of this year was strong, with revenue and gross margin meeting expectations, while operating profit margin and net profit exceeded expectations year-on-year [1] Group 2: Management Outlook - Management is optimistic about revenue growth from full-scenario AI business in the next two years, driven by open-source HarmonyOS IoT, AI agents, and ERP business [1] - It is expected that by 2026, the revenue contribution from related businesses will reach approximately 20% [1] - Management anticipates a continued recovery in demand for its cornerstone business (IT outsourcing) in the second half of the year [1]