Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [3][5]. Core Viewpoints - The company is a leading player in the indoor creative design sector, focusing on interior decoration design, with a strong asset quality and cash flow performance [1][3]. - The company is expected to recover steadily in performance as the peak of real estate impairment has passed, with a projected net cash ratio of 407% by the end of 2024 [1][3]. - The integration of AI technologies is anticipated to enhance the company's business model and operational efficiency, potentially leading to significant growth in profitability [2][3]. Company Overview - The company, established in 2010, has evolved into a prominent brand in the interior design industry, recognized for its creative output and industry influence [15]. - Its main business segments include space design and soft decoration, primarily serving real estate developers, with a growing presence in public and commercial sectors [23][27]. Financial Analysis - The company experienced a revenue decline in 2022 and 2023 due to the downturn in the real estate sector, but is projected to stabilize in 2024 with revenues of 5.3 billion yuan [27][30]. - The net profit for 2024 is expected to be 340 million yuan, showing a significant reduction in the decline compared to previous years [27][30]. - The company maintains a strong cash position, with over 1.08 billion yuan in cash assets, representing 78% of its current assets, and a low interest-bearing debt ratio of 1.8% [38][39]. Industry Analysis - The indoor design industry is considered a post-cycle sector of real estate, with a projected market size of approximately 96.9 billion yuan in 2024, influenced by new construction data [48]. - The demand for interior design services is closely tied to the new housing market, which has seen a decline in new construction over the past five years [1][48].

Group 1: Investor Relations Activity - The company held an annual online performance briefing on May 13, 2025, with interactive communication with investors [2] - As of March 31, 2025, the number of shareholders is 11,792 [2] - The company is gradually utilizing raised funds according to the investment plan [2] Group 2: 2024 Performance Overview - Total assets at the end of 2024 were CNY 207,653.85 million, a year-on-year increase of 2.68% [4] - Net profit attributable to shareholders was CNY 3,369.83 million, a decrease of 0.75% compared to the previous year [4] - Operating cash flow net amount was CNY 13,706.81 million, down 10.34% year-on-year [4] Group 3: Business Strategy and Development - The company aims to solidify its core business and adapt to market changes to seize new opportunities [10] - Emphasis on scientific management of clients and risk control to mitigate potential credit risks [10] - Plans to enhance talent acquisition and training to address industry uncertainties [10] Group 4: Market Position and Competitive Advantage - The company has established long-term partnerships with leading real estate firms, including China Resources Land and China Vanke [5] - It has received multiple prestigious design awards, enhancing its brand influence in the industry [6] - The company is positioned in the top tier of the industry in terms of business scale [7] Group 5: Financial Returns and Dividends - The company plans to distribute a cash dividend of CNY 3.50 per 10 shares, totaling CNY 63,000,000 based on the total share capital of 180,000,000 shares as of December 31, 2024 [9] Group 6: Challenges and Market Conditions - The domestic real estate market remains sluggish, leading to increased competition and a decline in overall gross margin [8] - Rising customer expectations for design quality have extended service cycles and increased costs [8]