Investment Rating - The investment rating for the company is "Buy" [4] Core Insights - The company reported a revenue of 4.86 billion yuan in Q3 2025, marking a 4% year-on-year increase, indicating a return to growth [1] - The net profit attributable to shareholders for the first three quarters reached 311 million yuan, a 45.9% increase year-on-year, driven by effective cost and expense management [1] - The overall gross margin improved to 87.4%, up 1.1 percentage points year-on-year, while management expenses decreased by 11.4% [1] - The digital cost business stabilized with new cloud contracts showing positive growth, laying a foundation for future revenue recovery [1] - The digital construction business saw a revenue increase of 17.2% year-on-year, with Q3 revenue growing by 33.1% [2] - The company's AI strategy is gaining traction, with new contracts exceeding 70 million yuan in the first three quarters, indicating a shift from technology concept to business value [2] Financial Summary - For 2025, the company expects revenues of 6.25 billion yuan and a net profit of 483 million yuan, with continued growth projected through 2027 [2][9] - The company's earnings per share (EPS) is projected to increase from 0.07 yuan in 2023 to 0.43 yuan in 2027 [9] - The price-to-earnings (P/E) ratio is expected to decrease from 202.5 in 2023 to 32.7 in 2027, indicating improved valuation over time [9]

Investment Rating - The investment rating for the company is "Buy" [5] Core Views - The company reported a main business revenue of 2.784 billion yuan in the first half of 2025, a year-on-year decrease of 5.2%, while the net profit attributable to shareholders increased by 23.7% to 237 million yuan [1][5] - Profitability improved due to effective cost and expense management, with an overall gross margin of 87.8%, up 1.1 percentage points year-on-year [1] - The digital cost business generated revenue of 2.286 billion yuan, down 7.1% year-on-year, but the decline in new cloud contracts has narrowed significantly in Q2 [1] - The digital construction business achieved revenue of 312 million yuan, growing 8.2% year-on-year, with a notable 19.5% growth in Q2 [2] - The company is fully embracing AI, with over 40 million yuan in contracts directly attributed to AI, and has developed over 80 AI products [2] Financial Forecasts - Expected revenues for 2025-2027 are 6.252 billion yuan, 6.447 billion yuan, and 6.671 billion yuan respectively, with net profits projected at 480 million yuan, 577 million yuan, and 660 million yuan [2][3] - The company anticipates a significant recovery in profitability, with net profit growth rates of 91.5% in 2025 and 20.2% in 2026 [3][10]

Financial Performance - In Q1 2025, the company achieved revenue of CNY 1.219 billion, a decrease of 5.24% year-on-year [1] - Net profit attributable to shareholders was CNY 29.84 million, a significant increase of 390.89% year-on-year [1] - Operating costs decreased by 18.42% year-on-year, primarily due to adjustments in outsourcing and raw material procurement costs [5] - Sales expenses increased by 3.7% year-on-year, driven by higher advertising, promotional, and travel costs [5] - Management expenses decreased by 20.28% year-on-year, mainly due to a reduction in one-time compensation and share-based payment expenses [5] Business Segment Performance - Digital cost business revenue was CNY 1.052 billion, a decrease of 4.69% year-on-year, with a stable renewal rate [2] - Digital construction business revenue was CNY 95.22 million, a decrease of 10.93% year-on-year, focusing on improving operational quality [3] - Digital design business revenue was CNY 5.80 million, slightly down from CNY 6.19 million year-on-year, with ongoing product recognition [4] Market Environment - National fixed asset investment grew by 4.2% year-on-year in Q1 2025, while real estate development investment continued to decline [1][2] - The construction industry remains in an adjustment phase, with Q1 typically being a low season due to seasonal factors [2] Strategic Adjustments - The company is focusing on profit-oriented strategies and resource allocation, optimizing personnel and business operations to maximize organizational potential [2] - Plans to enhance customer communication and resource preparation for targeted marketing in Q2 and the second half of the year [2] Future Outlook - Anticipated gradual improvement in the construction industry due to government fiscal policies and stabilization in real estate [4] - The company aims to leverage new market opportunities from policy changes and enhance product offerings to meet evolving customer needs [8][9] Personnel Management - The total number of employees decreased from 10,349 at the beginning of 2024 to 8,463 by the end of 2024 due to structural adjustments [6][7] - The company has completed personnel structure optimization in line with its 2025 strategic deployment [7] R&D and Cost Management - R&D expenses increased by 5.79% year-on-year, primarily due to software amortization [5] - The company has established a flexible budget control mechanism to manage expenses effectively throughout the year [10] Impact of External Factors - Tariffs have a limited direct impact on the company's business, as most operations are domestic with minimal international exposure [11][12] - The company is optimistic about the growth potential in urban renewal, which currently represents a small portion of its revenue [9]