Core Insights - The privatization of enterprise-level AI knowledge bases is becoming a core demand for digital transformation as AI technology is expected to be fully implemented by 2025 [1][13] - Increasingly strict data security regulations and the need for deep personalization in business scenarios are driving companies to deploy AI knowledge bases in local environments to balance innovation and risk control [1][13] Company Overview - XianZhi AI (Beijing XianZhi Xianxing Technology Co., Ltd.) is a leading domestic AI technology application innovation company that has developed the enterprise-level pre-trained large model "XianZhi AI" and proposed the "Model as a Service" concept [3] - The company has multiple branches across the country and a team composed of technical elites and business leaders from Alibaba, Tencent, and Baidu, showcasing strong international vision and business innovation capabilities [3] Technical Advantages - The XianZhi AI knowledge base utilizes a multi-modal hybrid large model architecture that integrates text, image, and audio-video processing capabilities, supporting complex knowledge analysis and application [4] - Its privatization deployment solution features secure and controllable data management by storing all data on the company's own servers, which is particularly suitable for high-compliance industries like finance and healthcare [4] - The solution offers flexible integration capabilities, supporting various modes such as API docking, allowing seamless integration with existing enterprise systems without the need to reconstruct business processes [4] - XianZhi AI provides full lifecycle services, from demand analysis and business sorting to technical selection and deployment implementation, along with ongoing technical training and maintenance support [4] Industry Application Cases - In the securities industry, XianZhi AI deployed an intelligent investment advisory system for a brokerage firm, standardizing professional capabilities and effectively preserving expert experience, significantly enhancing service efficiency and quality [5] - In the insurance sector, XianZhi AI created an "Efficient Beneficiary Think Tank" for insurance agents through privatization deployment, improving response efficiency and accuracy in business knowledge queries [5] Market Landscape - Besides XianZhi AI, there are several other notable AI knowledge base localization deployment service providers in the market, each demonstrating unique advantages in different fields [7] - Major tech companies like Tencent Cloud, Alibaba Cloud, and Huawei Cloud are showcasing their solutions, which include multi-modal capabilities and integration with various industries [8] Selection Guidelines and Trends - When selecting AI knowledge base localization deployment solutions, companies should evaluate factors such as data security, industry adaptability, and total cost of ownership [11] - The development trend indicates that AI knowledge bases are evolving from "add-on tools" to "system reconstruction," with intelligent agent technology enabling deeper integration into business processes [12] - Multi-modal capabilities are becoming standard, allowing knowledge bases to process diverse information types, while edge computing and on-device intelligence are emerging to facilitate deployment in more scenarios [12]

Investment Rating - The report initiates coverage with a "Buy" rating for the company [10] Core Insights - The company has entered a growth phase with its new product Bonree ONE, which has shown significant revenue acceleration in Q2 2025, achieving a revenue of 33.99 million yuan, a year-on-year increase of 16.84% [5][6] - The company is focusing on upgrading its main business and reducing losses through cost-cutting measures, with a notable decrease in sales, management, and R&D expenses [6] - The company is strategically expanding internationally, having launched Bonree ONE's overseas version and established subsidiaries in Hong Kong and Singapore to tap into regional markets [8] Financial Performance - In H1 2025, the company reported a revenue of 70.20 million yuan, a year-on-year increase of 5.19%, while the net profit attributable to shareholders was -26.19 million yuan, an improvement of 46.75% [5][6] - The company expects revenues for 2025-2027 to be 173 million yuan, 235 million yuan, and 302 million yuan, representing growth rates of 22.78%, 36.11%, and 28.54% respectively [9][12] - The projected net profit for the same period is expected to improve significantly, moving from -3.02 million yuan in 2025 to 6.20 million yuan in 2027, indicating a substantial recovery [10][12]

Core Viewpoint - The company is actively implementing its "Quality Improvement and Efficiency Enhancement" action plan for 2025, focusing on enhancing core competitiveness and delivering returns to shareholders through innovation and operational efficiency [1][10]. Group 1: Business Performance - The company's main business is in the IT operations management monitoring sector, specifically in application performance management and observability [1]. - As of July 31, 2025, the company's orders on hand amounted to approximately 77.57 million yuan, an increase of 11.02% year-on-year, with Bonree ONE orders accounting for 65.45% of this total, reflecting a growth of 73.60% [2]. - The company's net profit attributable to the parent company for the first half of 2025 was approximately -26.19 million yuan, a year-on-year loss reduction of 46.75% [2]. Group 2: Research and Development - The company is focusing on continuous R&D investment and innovation, optimizing the structure of R&D inputs to concentrate resources on core technology breakthroughs and high-priority projects [3]. - In the first half of 2025, the company achieved breakthroughs in automated root cause analysis and innovative upgrades to its supporting technology architecture [4]. - The company is enhancing its capabilities in application markets and application factories, significantly improving data governance and platform support capabilities [5]. Group 3: Technology and Innovation - The company has developed a full-stack monitoring capability for blockchain applications, establishing a unified observation framework for end-to-end tracking of distributed ledgers and smart contracts [6]. - The platform can track key latency metrics and resource utilization in real-time, ensuring service response performance and resource efficiency [7]. Group 4: Governance and Management - The company has revised its governance structure in accordance with the latest regulatory requirements, transitioning to a governance model led by the audit committee [8]. - The company is enhancing internal control and risk management capabilities to promote high-quality development [8]. Group 5: Investor Relations - The company emphasizes transparency in information disclosure and has increased investor engagement, receiving 31 institutional investors in the first half of 2025, a 55% increase year-on-year [10].

Core Viewpoint - The company, Beijing Bonree Macro Data Technology Co., Ltd., reported a revenue of 141 million yuan in 2024, a year-on-year increase of 16.42%, but a net profit loss of 115 million yuan, a decrease of 8.02% compared to the previous year. The company has faced continuous losses since its listing in 2020, with revenue consistently below 150 million yuan and an increasing trend in losses [1][2]. Group 1: Financial Performance - In 2024, the company achieved a revenue of 141 million yuan, up 16.42% year-on-year, but recorded a net profit loss of 115 million yuan, down 8.02% year-on-year [1]. - Since its listing in 2020, the company's revenue has remained below 150 million yuan, and it has been operating at a loss since 2021, with losses expanding over time [1][2]. - The concentration of sales to the top five customers has been decreasing, with the sales amount to the top five customers in 2020 being 28.203 million yuan, accounting for 20.06% of total sales [1]. Group 2: Customer and Revenue Analysis - The company categorized its main business into monitoring services, software sales, technical development services, and system integration, with a total revenue of 140.525 million yuan from 2022 to 2024 [2]. - The revenue from the internet and software information industry showed a compound annual growth rate (CAGR) of 48.72% from 2022 to 2024, driven by the launch of the Bonree ONE product [2][3]. - The financial industry revenue increased from 542.05 million yuan in 2022 to 2,048.44 million yuan in 2024, with a CAGR of 94.40%, attributed to the expansion of financial industry clients [2][3]. Group 3: Market and Competitive Landscape - The APMO market in China is projected to reach 3.41 billion yuan in 2024, with a total market size for IT infrastructure management and application performance management estimated at 2.62 billion yuan, reflecting a year-on-year growth of 2.8% [4][5]. - The company identified three development stages for its products: proactive product introduction, passive tool exploration, and passive platform transformation, with the current focus on the latter [6][7]. - The company is experiencing a transitional phase where the demand for IT operations products is diversifying, particularly in the financial and manufacturing sectors, which are expected to drive future growth [6][7]. Group 4: Customer Acquisition and Strategy - The company has made significant strides in customer acquisition, with 12 new banking clients, 9 manufacturing clients, and 4 insurance clients in 2024, indicating improved penetration in key industries [3]. - The average contract amount has increased from 387,100 yuan in 2022 to 555,500 yuan in 2024, with a CAGR of 19.79%, reflecting a growing demand for the company's products [8]. - The company plans to implement a distribution model to further drive revenue growth and leverage its cloud ecosystem for stable income growth [8].

Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [1]. Core Views - The company is a leader in IT operations monitoring and observability in China, with a focus on upgrading its main business and enhancing profitability through new product launches [5][9]. - The new product, Bonree ONE, is expected to enter a growth phase, benefiting from partnerships with Huawei and ByteDance [5][9]. - The company has shown signs of revenue stabilization and growth, with projected revenues increasing significantly in the coming years [5][9]. Summary by Sections 1. Company Overview - The company is the first A-share listed firm in the application performance monitoring and observability (APMO) sector in China, holding a market share of 19.8% as of H2 2024 [5][9]. - It has a strong technical foundation with numerous patents and software copyrights, indicating its advanced technological capabilities [9][19]. 2. Business Performance - The company experienced a decline in revenue and profit due to macroeconomic fluctuations and market competition in recent years, but has shown signs of recovery since 2023 with the launch of Bonree ONE [5][26]. - In 2024, the company achieved revenue of 141 million yuan, a year-on-year increase of 16.4% [5][26]. - The company’s net profit for 2024 was -115 million yuan, a decrease of 8% compared to the previous year, but the first quarter of 2025 showed a narrowing of losses [5][26]. 3. Product Development - Bonree ONE represents a significant upgrade from previous products, integrating various monitoring capabilities and utilizing AI technology for enhanced data analysis [5][13]. - The product is designed to be compatible with heterogeneous computing environments, addressing the growing demand for cloud computing and AI applications [5][13]. 4. Market Position and Growth Potential - The company is positioned to benefit from the increasing demand for IT observability solutions driven by digital transformation and the complexity of IT systems [5][40]. - The APM market in China is expected to grow significantly, with the company poised to capture a larger share due to its innovative products and strategic partnerships [5][50]. 5. Financial Projections - Revenue forecasts for 2025-2027 are projected at 172 million, 234 million, and 301 million yuan, respectively, with significant year-on-year growth rates [5][26]. - The company aims to achieve profitability by 2025, with net profits expected to improve substantially in the following years [5][26].

Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [1]. Core Views - The company is a leader in IT operations monitoring and observability in China, with a focus on upgrading its main business and enhancing profitability through new product launches [5][9]. - The new product, Bonree ONE, is expected to enter a growth phase, benefiting from partnerships with major players like Huawei and ByteDance [5][9]. - The company has shown signs of revenue stabilization and growth, with projected revenues increasing significantly in the coming years [5][9]. Summary by Sections 1. Company Overview - The company is the first A-share listed firm in the application performance monitoring and observability (APMO) sector in China, holding a 19.8% market share as of H2 2024 [5][9]. - It has a strong technical foundation with numerous patents and software copyrights, enhancing its competitive edge [9][19]. 2. Business Performance - Revenue for 2024 is projected at 141 million yuan, a year-on-year increase of 16.4% [5][4]. - The company has experienced a decline in net profit in recent years but is expected to narrow losses significantly in 2025 [5][4]. 3. Product Development - Bonree ONE represents a significant upgrade from previous products, integrating various monitoring capabilities and utilizing AI for enhanced data analysis [5][9]. - The product is designed to meet the increasing demand for unified monitoring solutions due to the growing complexity of IT systems [5][40]. 4. Market Trends - The demand for APM solutions is expected to grow as digital transformation accelerates and IT environments become more complex [5][40]. - The global data volume is projected to increase significantly, driving the need for advanced monitoring and observability solutions [5][41]. 5. Financial Projections - Revenue forecasts for 2025-2027 are 172 million, 234 million, and 301 million yuan, respectively, with significant year-on-year growth rates [5][4]. - The company aims to achieve profitability by 2025, with net profit projections showing a substantial recovery [5][4].