Macro Strategy - The core viewpoint of the report indicates that the main theme of China's economy in 2025 is to respond to changes, influenced by external factors such as fluctuating tariffs and internal factors like asset revaluation and investment trends [1][4] - For 2026, the focus will be on continuity and adaptation, with five key areas of transition: policy support, AI-driven supply, consumption upgrades, wealth recovery, and price stability [1][4] - Economic growth is projected at around 4.9%, with consumption and export growth slightly declining while investment growth is expected to improve [1][4] Fixed Income and Equity Analysis - The report discusses the issuance of Maolai Convertible Bonds, with a total issuance scale of 563 million yuan, aimed at funding precision optical production and R&D projects [5][6] - The expected listing price range for Maolai Convertible Bonds is between 129.60 and 143.56 yuan, with a low conversion premium of approximately 4.04% [5][6] - The financial performance of Maolai Optical shows a compound annual growth rate of 17.78% from 2019 to 2024, with revenue fluctuations and a projected revenue of 503 million yuan in 2024 [6] Company-Specific Insights - Hengyin Technology is highlighted as a leader in banking smart terminals, with a focus on blockchain technology to empower digital currency [7][8] - The company is expected to see revenue growth from 500 million yuan in 2025 to 800 million yuan in 2027, with a target price of 14.4 yuan for 2026 based on a 12x price-to-sales ratio [7][8] - The report emphasizes the importance of digital RMB and blockchain technology as key drivers for future growth, with a significant increase in overseas revenue expected [7][8]

Investment Rating - The report initiates coverage with a "Recommended" rating for Hengyin Technology [4][48][5] Core Viewpoints - Hengyin Technology is positioned as a leading provider of smart banking solutions in China, leveraging a "smart terminal + AI algorithm + scenario ecosystem" strategy to drive its growth and transformation in the financial technology sector [1][17] - The company has successfully expanded its business into various sectors beyond finance, including government, healthcare, and transportation, establishing itself as a comprehensive solution provider [1][24] - The company is experiencing a recovery in profits, with significant growth in overseas markets contributing to improved revenue and net profit forecasts for the coming years [2][32][37] Summary by Sections 1. Strategic Framework - Hengyin Technology focuses on the development and application of smart terminals and AI algorithms, aiming to support traditional banks in their transition to smart banking [1][17] - The company has built a robust product matrix covering multiple scenarios, including finance, government, and social security, and has established stable partnerships with major banks and financial institutions [24][21] 2. Profit Recovery and International Expansion - From 2021 to 2023, the company faced declining revenues and profits due to macroeconomic factors and market competition, but it began to recover in 2024, driven by cost reduction and international market expansion [2][32] - In the first half of 2025, the company reported a significant increase in revenue and net profit, with overseas revenue showing explosive growth, indicating the effectiveness of its international strategy [37][38] 3. Policy and Technology Drivers - The self-service terminal industry is expected to enter a growth phase, supported by national policies promoting digital finance and technological advancements [3][43] - The market size for self-service terminals is projected to grow from 35 billion yuan in 2019 to 65 billion yuan in 2024, reflecting strong internal growth momentum [3][44] 4. Financial Forecasts - The company forecasts net profits of 56.47 million yuan, 79 million yuan, and 90 million yuan for 2025, 2026, and 2027 respectively, with corresponding EPS of 0.11, 0.15, and 0.17 yuan [4][48] - The report highlights a significant improvement in profitability metrics, with a projected return on equity (ROE) increasing from -16.43% in 2023 to 5.87% in 2027 [10][50]

Core Viewpoint - The annual report of Hengyin Financial Technology Co., Ltd. for 2024 highlights the company's strategic transformation towards becoming a leading global fintech ecosystem service provider, focusing on innovation, digitalization, and operational efficiency. Company Overview and Financial Indicators - Hengyin Financial Technology Co., Ltd. reported a net profit attributable to shareholders of 40,123,574.32 yuan for 2024, with a proposed cash dividend distribution plan pending shareholder approval [5]. - The company achieved an operating income of 437,462,357.15 yuan in 2024, reflecting a slight increase from 426,686,741.60 yuan in 2023 [7][8]. - The total assets of the company were recorded at 1,742,791,294.49 yuan, showing a decrease of 4.37% compared to the previous year [8]. Business Strategy and Market Position - The company aims to leverage fintech to empower the real economy, focusing on technological innovation to break industry barriers and enhance organizational vitality [6][7]. - Hengyin has established a comprehensive product matrix covering various sectors, including finance, government, transportation, and social security, utilizing advanced computer vision and AI algorithms [18][20]. - The company has successfully expanded its international market presence, achieving sales in over 60 countries, including Bangladesh and the Philippines [23]. Product Development and Innovation - Hengyin has made significant advancements in new-generation core technology, achieving batch production and notable cost reductions [6][7]. - The company has developed an AI training platform for banknote recognition, integrating deep learning models to enhance its product capabilities [7][25]. - Continuous innovation in software solutions has been a focus, with the development of a comprehensive software suite covering all processes from device drivers to banking backend systems [26]. Industry Trends and Opportunities - The fintech industry is evolving from "tool empowerment" to "underlying reconstruction," with technologies like AI, big data, blockchain, and cloud computing becoming integral to financial services [10][12]. - The market for open banking is projected to reach 19.8 billion USD by 2024, indicating a shift towards platform-based and scenario-based competition [11]. - The demand for inclusive finance is expected to grow, driven by the integration of advanced technologies that lower service thresholds and costs [10][12]. Competitive Landscape - The global market for financial smart terminals is expanding, with North America, Europe, and the Asia-Pacific regions leading in adoption [13][14]. - Companies in the sector are increasingly focusing on technological innovation to enhance product performance and service quality, with AI and machine learning playing a crucial role [15][16]. - Regulatory policies are tightening, requiring companies to meet safety and data privacy standards while encouraging innovation through supportive measures [16][17].