Core Viewpoint - The stock of 伟仕佳杰 (00856) has seen a price increase of over 3% during trading, currently at 9.29 HKD with a trading volume of 86.90 million HKD, indicating positive market sentiment towards the company [1] Group 1: Business Performance - 天风证券 reports that 伟仕佳杰's Southeast Asia business has established a diversified presence in nine countries, including Thailand, Singapore, the Philippines, and Malaysia, focusing on GPU, AI infrastructure, and consumer electronics [1] - The projected revenue for the Southeast Asia region is expected to increase significantly by 74% year-on-year in 2024, with net profit contribution around 51% [1] Group 2: Growth Drivers - The company is anticipated to benefit from three main drivers: rapid global demand for computing power, accelerated channel expansion in Southeast Asia, and the implementation of new directions such as electric vehicles and cross-border payments [1] - Forecasted net profit for the company from 2025 to 2027 is estimated at 1.251 billion, 1.532 billion, and 1.883 billion CNY, with corresponding growth rates of 30%, 22.4%, and 22.9% respectively [1] Group 3: Valuation Outlook - Given the sustained high growth in global computing power, accelerated digital infrastructure development in Southeast Asia, and the effectiveness of the company's diversified business layout, the current valuation of 伟仕佳杰 is believed to have significant upside potential [1]

Core Viewpoint - The company is positioned as a leading ICT distribution player in the Asia-Pacific region, with steady revenue and profit growth, and excellent cash flow performance [1] Group 1: Financial Performance - The company's revenue is projected to increase from 63.7 billion yuan in 2020 to 81.1 billion yuan in 2024, representing a year-on-year growth of 20.6% [1] - The net profit attributable to the parent company is expected to rise from 830 million yuan in 2023 to 958 million yuan in 2024, reflecting a year-on-year growth of 14.09% [1] - Operating cash flow is anticipated to significantly improve, reaching 1.659 billion yuan in 2024, a year-on-year increase of 185% [1] Group 2: Market Trends - The demand for computing power driven by generative AI is becoming a core engine for growth in the Chinese ICT market, with total ICT spending expected to reach approximately 5.3 trillion USD in 2024, growing to 6.9 trillion USD by 2028, with a five-year CAGR of 7% [2] - The Chinese enterprise-level ICT market is projected to grow from approximately 269.36 billion USD in 2024 to nearly 415 billion USD by 2028, with a CAGR of 6.5% [2] Group 3: Regional Development - The Southeast Asian data center market is experiencing rapid growth, with the region expected to account for 44% of the total installed capacity in Asia by the end of 2024, totaling 22,780 MW [3] - Major global tech companies are investing heavily in Southeast Asia's data center and computing infrastructure, positioning the region as the third-largest new computing power market globally [3] Group 4: Strategic Initiatives - The company is leveraging its strong ICT channels and financial management to drive growth in Southeast Asia through a three-pronged strategy: positioning in Southeast Asia, upgrading cloud services, and operating AI computing power [3] - The company's Southeast Asia business is expected to see a significant revenue increase of 74% year-on-year in 2024, with net profit contributing approximately 51% [3] - The company is collaborating with top cloud service providers to enhance its cloud business and is increasing its AI R&D investment by 50% by 2025 [3] Group 5: Profit Forecast - Revenue projections for the company from 2025 to 2027 are estimated at 103.7 billion yuan, 129.63 billion yuan, and 155.55 billion yuan, with corresponding growth rates of approximately 28%, 25%, and 20% [4] - Net profit forecasts for the same period are 1.251 billion yuan, 1.532 billion yuan, and 1.883 billion yuan, with growth rates of 30%, 22.4%, and 22.9% respectively [4] - The company is expected to have significant valuation upside, with a target price of 11.52 HKD based on a PE of 12x for 2025 [4]

Group 1: Macro Strategy and Market Overview - The upcoming third round of trade talks between China and the US is expected to focus on energy and rare earth materials, with potential extensions of negotiation deadlines [2] - A-shares saw slight increases across major indices, with the CSI 500 and ChiNext rising by 3.28% and 2.76% respectively [2] - The central bank's net fund injection was 109.5 billion yuan, indicating a slight rebound in short-term interest rates [2] - The US dollar index showed a slight decline, closing at 97.67, down 0.8% week-on-week, while the RMB appreciated by 0.18% [2] Group 2: Fixed Income and Debt Market - The Southbound Bond Connect is expected to facilitate investment in Chinese dollar bonds, with a focus on city investment bonds benefiting from local debt policies [4] - The Hong Kong bond market has a total outstanding amount of 19.55 billion USD in HKD bonds and 17.32 billion USD in offshore RMB bonds [4] - The outlook for Chinese dollar bonds remains positive, with expected continued good returns due to narrowing yield spreads and favorable policies [4][33] Group 3: Coal Industry Insights - Domestic coal social inventory decreased in June 2025, leading to a rebound in coal prices, with expectations for port prices to reach 700-750 yuan per ton [9] - The government aims for coal production to reach approximately 4.8 billion tons in 2025, with potential adjustments in production capacity to ensure supply [9] Group 4: Company-Specific Analysis - Wei Shi Jia Jie (00856) is expected to benefit significantly from the AI and cross-border payment sectors, with projected revenue growth from 63.7 billion yuan in 2020 to 81.1 billion yuan in 2024 [11] - The company is positioned to capture growth in the Southeast Asian ICT market, which is projected to reach approximately 415 billion USD by 2028 [11] - The company anticipates a significant increase in net profit from 830 million yuan in 2023 to 958 million yuan in 2024, reflecting a growth rate of 14.09% [11][15] Group 5: Construction and Materials Sector - Su Jiao Ke (300284) reported a revenue decline of 13.75% in H1 2025, but is transitioning towards becoming a "think tank technology enterprise" with a focus on new business areas [16] - The company has developed five cloud platforms aimed at enhancing its service offerings in urban safety and low-altitude economy [16] Group 6: Chemical Industry Trends - The proportion of public funds holding basic chemical stocks has slightly decreased, with a shift towards mid-cap stocks [15] - The chemical sector has seen a notable increase in the holding ratio of leading stocks, indicating a preference for smaller-cap stocks [15]

Investment Rating - The report assigns a "Buy" rating for the company with a target price of HKD 11.52, based on a current price of HKD 8.85 [3]. Core Insights - The company is positioned as a leading technology product channel developer and solution integrator in the Asia-Pacific region, focusing on ICT industry solutions, particularly in enterprise systems, consumer electronics, and cloud computing. The company is expected to benefit significantly from the dual drivers of AI and cloud services, alongside the expansion in Southeast Asia [1][10]. - Revenue is projected to grow from HKD 637 billion in 2020 to HKD 811 billion in 2024, representing a year-on-year growth of 20.6%. Net profit is expected to increase from HKD 8.3 billion in 2023 to HKD 9.58 billion in 2024, a growth of 14.09% [1][3]. - The company has a strong cash flow performance, with operating cash flow expected to rise to HKD 16.59 billion in 2024, reflecting a significant year-on-year increase of 185% [1][28]. Summary by Sections 1. Company Overview - The company has established itself as a top player in the ICT distribution sector, with a diversified business model that includes enterprise systems, consumer electronics, and cloud computing services. It has been recognized in the Fortune China 500 for five consecutive years [10][11]. 2. Market Growth Drivers - The global ICT market is projected to grow from approximately USD 5.3 trillion in 2024 to USD 6.9 trillion by 2028, with a CAGR of 7%. The Chinese ICT market is expected to grow from USD 626 billion in 2024 to USD 751.76 billion by 2028, with a CAGR of 6.5% [1][30]. - The demand for generative AI is driving significant growth in the ICT sector, particularly in GPU servers, AI chips, and cloud infrastructure investments [1][31]. 3. Southeast Asia Focus - The company has strategically positioned itself in Southeast Asia, where the data center market is experiencing rapid growth. By the end of 2024, Southeast Asia is expected to become the third-largest market for new computing capacity globally [2][56]. - The company has established a robust presence in nine Southeast Asian countries, with significant market shares in Thailand, Singapore, Indonesia, the Philippines, and Malaysia [2][68]. 4. Financial Projections - Revenue forecasts for 2025-2027 are projected at HKD 1,037 billion, HKD 1,296.26 billion, and HKD 1,555.51 billion, respectively, with corresponding growth rates of approximately 28%, 25%, and 20% [3][4]. - Net profit estimates for the same period are HKD 12.51 billion, HKD 15.32 billion, and HKD 18.83 billion, with growth rates of 30%, 22.4%, and 22.9% [3][4]. 5. Cash Flow and Operational Efficiency - The company demonstrates strong operational efficiency, with inventory turnover days at 46 and accounts receivable turnover days at 74. The overall operational turnover days are only 52, indicating effective cash management [28].

Core Viewpoint - Tianfeng Securities has initiated coverage on Weishi Jiajie (856.HK) with a "Buy" rating and a target price of HKD 11.52 [1] Group 1: Company Overview - Weishi Jiajie is a leading technology product channel developer and integrated service provider in the Asia-Pacific region, focusing on ICT industry solutions, particularly in enterprise systems, consumer electronics, and cloud computing [2] - The company has experienced high growth in recent years, with revenue projected to increase from 63.7 billion to 81.1 billion by 2024, representing a year-on-year growth of 20.6% [2] - The net profit attributable to the parent company is expected to grow from 830 million in 2023 to 958 million in 2024, a year-on-year increase of 14.09% [2] - The operating cash flow is projected to significantly improve to 1.659 billion in 2024, reflecting a year-on-year growth of 185% [2] Group 2: Market Trends - The demand for computing power and AI is driving growth in the Chinese ICT market, with global ICT spending expected to reach approximately USD 5.3 trillion in 2024 and grow to USD 6.9 trillion by 2028, representing a five-year CAGR of 7% [3] - The Chinese ICT market is anticipated to grow from approximately USD 626 billion in 2024 to USD 751.76 billion by 2028, with a CAGR of 6.5% [3] - The enterprise-level ICT market in China is projected to reach approximately USD 269.36 billion in 2024, with a year-on-year growth of 11.7% [3] Group 3: Regional Developments - The data center market is highly concentrated in North America, Asia, and Europe, with Southeast Asia experiencing a digital infrastructure construction boom [4] - By the end of 2024, Asia's data center installed capacity is expected to reach 22,780 MW, accounting for 44% of the global total [4] - Major global tech companies are investing heavily in Southeast Asia's data centers and computing infrastructure, positioning the region as the third-largest new computing power market globally [4] Group 4: Business Strategy - Weishi Jiajie is leveraging its strong ICT channels and financial management to rapidly expand in Southeast Asia, focusing on AI and cloud service upgrades [5] - The company's Southeast Asia business is projected to see a significant revenue increase of 74% in 2024, with net profit contributing approximately 51% [5] - Collaborations with top cloud service providers are enhancing the company's cloud business, covering over 30 intelligent computing centers in China [5] - The company is also advancing its initiatives in electric vehicle solutions and cross-border payment scenarios, which are expected to synergize with its core ICT distribution business [5] Group 5: Financial Projections - Revenue forecasts for Weishi Jiajie from 2025 to 2027 are projected at 103.7 billion, 129.63 billion, and 155.55 billion, with growth rates of approximately 28%, 25%, and 20% respectively [6] - The net profit attributable to the parent company is expected to be 1.251 billion, 1.532 billion, and 1.883 billion from 2025 to 2027, with growth rates of 30%, 22.4%, and 22.9% respectively [6] - Given the ongoing high demand for computing power and the acceleration of digital infrastructure in Southeast Asia, the current valuation is seen to have significant upside potential, with a target price of HKD 11.52 based on a PE of 12x for 2025 [6]

Summary of Weishi Jiajie Conference Call Company Overview - Weishi Jiajie operates in the ICT industry, focusing on distribution for foreign brands entering the Chinese market and domestic brands expanding overseas. The company was established in 1991 and is headquartered in Beijing, listed on the Hong Kong Stock Exchange since 2002 with a compound annual growth rate (CAGR) of 24% since then [2][3][5]. Financial Performance - In 2024, Weishi Jiajie's revenue reached HKD 89 billion, a year-on-year increase of 21%, with net profit at HKD 1.05 billion, up 14%. The return on equity (ROE) has been maintained above 10% for 23 consecutive years [2][5]. - For Q1 2025, revenue grew by 16%, gross profit increased by 20%, and net profit rose by 28% [2][5]. - The company has a cash reserve of approximately HKD 3.9 billion and total liabilities around 70%, indicating strong capital management [2][6]. Market Dynamics - Weishi Jiajie has a significant presence in Southeast Asia, with a market growth rate of 74% compared to 4% in China. The Southeast Asian market contributes over 50% to the company's profits [2][3][12]. - The company is the largest distributor for brands like iFLYTEK, Huawei, and Lenovo in Southeast Asia, with overseas sales accounting for about 24-25% of total sales [2][4]. Strategic Initiatives - The company is expanding its cloud services and computing power business, having acquired Cloud Star Data, which contributed 4% to total revenue in 2024, with expectations of 60-70% growth in 2025 [2][4]. - Weishi Jiajie is considering entering the automotive distribution sector, particularly electric vehicles, leveraging its existing distribution network in Southeast Asia [3][13][14]. Competitive Landscape - The company faces competition from firms like Digital China, Ingram Micro, and Tech Data. However, its established relationships and experience in channel management provide a competitive edge [3][19][20]. - The gross margin in Southeast Asia is slightly higher due to favorable distributor conditions, with profits from this region expected to exceed 50% in 2025 [11][12]. Future Outlook - Weishi Jiajie anticipates a revenue growth of 20% and profit growth of 30% over the next three years, with a projected net profit of HKD 1.25 billion in 2025 [3][16]. - The company is also exploring opportunities in Vietnam and plans to maintain its focus on the Southeast Asian market, which is expected to grow significantly due to low penetration rates and increasing demand for ICT solutions [9][21]. Investment Appeal - The company's valuation is considered low, with a price-to-earnings (PE) ratio of approximately 8-9 times and a dividend payout ratio of 30-40%, making it attractive to investors seeking defensive yet growth-oriented opportunities [3][10].