Core Insights - Siemens and Capgemini are expanding their strategic partnership to co-develop AI-native digital solutions for product engineering, manufacturing, and operations, focusing on 16 high-impact capability areas to enhance production efficiency, time-to-market, quality, and sustainability [1][2] Partnership Details - The collaboration aims to address long-standing challenges in integrating IT and operational systems by leveraging technologies such as industrial AI, digital twins, and next-generation automation [2] - The partnership will utilize orchestrated AI agents to enhance collaboration across engineering and manufacturing silos [2] Leadership Statements - Siemens' CEO Cedrik Neike emphasized the partnership's role in guiding customers through digital transformation with speed and precision, while Capgemini's CEO Aiman Ezzat highlighted the ambition to help clients achieve operational efficiency and tangible business impact [3] Client Case Studies - For Airbus, the partnership is focused on decarbonizing four industrial locations, targeting a 20% reduction in energy consumption and an 85% reduction in Scope 1 and 2 emissions by 2030, utilizing energy system twins for optimal decarbonization roadmaps [3][4] - In the case of Sanofi, the collaboration is standardizing production processes and accelerating the rollout of Manufacturing Execution Systems (MES), resulting in a 70% reduction in review time and an 80% decrease in deviations [4] - For GravitHy, the partnership aims to digitalize industrial processes, targeting a hydrogen production cost reduction of up to 10% [6] Industry Focus - The joint initiative will concentrate on key industries such as aerospace, automotive, and life sciences, as well as emerging markets like hydrogen and water/wastewater [7] - Capgemini plans to expand its pool of certified experts to enhance its Siemens technology capabilities [7] Company Background - Siemens generated revenue of €75.9 billion and net income of €9.0 billion in fiscal 2024, employing around 312,000 people globally [10] - Capgemini reported global revenues of €22.1 billion in 2024, with a workforce of 420,000 team members across more than 50 countries [11]

Summary of Shanghai Baosight Software (600845.SS) Conference Call Company Overview - **Company**: Shanghai Baosight Software - **Ticker**: 600845.SS - **Industry**: Software and Automation for Manufacturing, particularly in the Steel Industry Key Financial Results - **4Q24 Results**: - Revenue: Rmb3,888 million, down 5% YoY - Gross Profit: Rmb1,226 million, down 4% YoY - EBIT: Rmb348 million, down 41% YoY - Net Income: Rmb335 million, down 51% YoY - Gross Profit Margin: 32%, flat YoY - Operating Profit Margin: 9%, down 5 percentage points YoY - Net Profit Margin: 9%, down 8 percentage points YoY - All figures missed Goldman Sachs estimates by 7% to 53% [1][2][8] Related-Party Revenue - **2024 Related-Party Revenue**: Rmb6,916 million, down 5% YoY, missing prior guidance by 39% [1][6] - **2025 Guidance**: Targeting Rmb10,200 million in related-party revenue, indicating a 10% decline from 2024 [2][6] Industry Outlook - **Steel Industry Investment**: Continued uncertainties expected, with depressed capacity utilization and margins forecasted for 2025 [2] - **Steel Demand**: Anticipated to stabilize YoY after a prolonged contraction since 2021 [2][3] Revised Financial Forecasts - **Net Income Forecasts**: Revised down by 12-14% for 2025-2030 to reflect current results and industry outlook [2][7] - **New Revenue Estimates**: - 2024: Rmb13,644 million - 2025E: Rmb15,286 million - 2026E: Rmb17,091 million - 2027E: Rmb19,529 million - 2028E: Rmb22,269 million - 2029E: Rmb25,496 million - 2030E: Rmb28,996 million [7] Investment Thesis - **Growth Drivers**: - Increased spending on production software to enhance manufacturing efficiency - Continued consolidation in the steel industry by Baowu Steel Group - Proven track record of expanding into new markets and customers - **Risks**: - 51% of revenue from related-party transactions, exposing the company to fluctuations in spending from Baowu [10][11] Valuation - **12-Month Price Target**: Rmb28.5, based on a 27X 2026E PE discounted back to 2025E with a 10.5% cost of equity [2][11] - **Current Price**: Rmb28.46, indicating a minimal upside of 0.1% [12] Conclusion - The company is rated as Neutral, reflecting a fair valuation compared to peers in the China Industrial Tech sector, with significant reliance on related-party revenue and a challenging outlook for the steel industry [10][11]