Investment Rating - The report initiates coverage with a "Buy" rating for the company [5]. Core Insights - The company is transforming into a "digital ecosystem operator" by leveraging its resources in the Guangdong-Hong Kong-Macao Greater Bay Area, focusing on residential and urban renewal projects [1][2]. - A significant acquisition of Wisdom Knight Holdings Limited for HKD 977 million positions the company strategically in the AI and green energy computing sectors [2]. - The traditional business model is now a growth driver, with a successful debt-to-equity conversion plan reducing the interest-bearing debt ratio from 45% to 7% [2]. - The integration of AI computing services and energy management is expected to enhance operational efficiency and profitability [3]. Financial Summary - The company forecasts net profits for 2025, 2026, and 2027 to be CNY 718 million, CNY 579 million, and CNY 789 million, respectively, with growth rates of +139.13%, -19.41%, and +36.41% [3][4]. - Revenue projections show a significant increase from CNY 801.54 million in 2025 to CNY 6,432.54 million in 2027, reflecting a growth rate of 470.13% [4]. - The company’s earnings per share (EPS) is expected to improve from -CNY 3.32 in 2024 to CNY 0.70 in 2027 [4]. Strategic Development - The company’s "urban ecosystem" strategy aims to convert idle factories and land into high-performance computing centers, aligning with its capabilities in urban development [3]. - The acquisition of high-value B-end resources from major cloud service providers and leading AI companies is anticipated to open new growth avenues [3]. - The dual business model of AI computing services and lifecycle management is validated commercially, enhancing the company's resilience and profitability [3].

Group 1 - The company Shenzhen Zhishang Technology Co., Ltd. plans to acquire 99.8555% equity of Hengyang Data through a combination of issuing shares and cash payment [1][12][17] - The transaction aims to enhance the company's strategic layout in the data communication and intelligent computing sectors, transitioning from "data transmission" to "intelligent data transmission and processing" [17][22] - The acquisition is expected to increase the company's total assets from approximately 310,082.62 million to 448,402.33 million, and net profit from 2,358.55 million to 3,131.63 million post-transaction [21][20] Group 2 - The transaction will result in an increase in the company's total share capital from 128,680,995 shares to 147,335,805 shares, without changing the actual control of the company [19][22] - The company has committed to ensuring fair and reasonable pricing for the transaction by hiring qualified accounting firms and asset evaluation agencies [23][22] - The performance commitment for Hengyang Data includes achieving a cumulative net profit of no less than 300 million over three years, with specific annual targets set for 2025, 2026, and 2027 [12][22]

Core Viewpoint - The company reported strong financial performance in Q1 2025, with significant growth in revenue and net profit, driven by expansion in AI computing and leasing business [1][2] Financial Performance - Q1 2025 revenue reached 2.077 billion yuan, an increase of 18.11% year-on-year [1] - Net profit attributable to shareholders was 169 million yuan, up 4.29% year-on-year [1] - Non-recurring net profit was 165 million yuan, reflecting a year-on-year growth of 1.91% [1] Asset and Cash Position - Total assets as of Q1 2025 amounted to 9.997 billion yuan, representing a 36.85% increase year-on-year [1] - Cash and cash equivalents increased significantly, with monetary funds at 2.466 billion yuan, up 61.44% year-on-year [1] - Short-term borrowings rose to 1.974 billion yuan, a 51.64% increase, while long-term borrowings surged to 1.780 billion yuan, up 334.42% [1] Business Expansion - The company is heavily investing in server procurement, with prepayments for equipment reaching 559 million yuan, a 217.72% increase year-on-year [1] - Contract liabilities grew to 98 million yuan, reflecting a substantial increase of 364.8% year-on-year [1] - Inventory levels rose to 2.202 billion yuan, marking a 16.48% increase year-on-year [1] Operational Costs and Challenges - The increase in net profit was impacted by personnel expansion, with sales expenses rising to 13 million yuan, a 140.34% increase year-on-year [2] - Management expenses increased to 34 million yuan, up 20.84% due to higher stock incentive costs [2] - Credit impairment losses expanded to 39 million yuan, a 128.60% increase year-on-year, attributed to aging accounts [2] Future Outlook - The company is focusing on developing its AI computing center and leasing business, aiming to create a multi-level growth engine [2] - Revenue projections for 2025-2027 are estimated at 10.732 billion, 13.635 billion, and 16.946 billion yuan, respectively, with net profits expected to reach 1.108 billion, 1.629 billion, and 2.114 billion yuan [2]