Topsec(002212) 华创证券·2024-11-04 10:09Investment Rating - The report maintains a "Recommend" rating for Tianrongxin (002212) with a target price of 9.8 RMB [1][3] Core Views - Q3 2024 revenue growth turned positive YoY, with a 10.21% increase in Q3 revenue to 709 million RMB [1] - Net profit attributable to shareholders turned positive in Q3 2024, reaching 36.49 million RMB compared to a loss of 36.22 million RMB in the same period last year [1] - Cloud security revenue grew significantly by 126.40% YoY in the first three quarters of 2024 [1] - The company's cost reduction and efficiency improvement strategy led to a 5.26% YoY decrease in total expenses for the first three quarters of 2024 [1] Financial Performance - Total revenue for the first three quarters of 2024 was 1.582 billion RMB, a 3.98% YoY decrease [1] - Net loss attributable to shareholders narrowed to 169 million RMB in the first three quarters of 2024, compared to 248 million RMB in the same period last year [1] - Cloud computing and cloud security products/services revenue grew 11.58% YoY to 188 million RMB in the first three quarters of 2024 [1] Business Development - The company has been expanding into new security business areas, including smart rail transit network security, vehicle-road-cloud integrated security, and smart hospital cloud security [1] - Revenue from new businesses such as cloud security and Xinchuang (信创) grew significantly by 126.40% and 57.96% respectively in the first three quarters of 2024 [1] Financial Forecasts - Revenue is expected to grow to 3.408 billion RMB in 2024, 3.903 billion RMB in 2025, and 4.346 billion RMB in 2026 [2] - Net profit attributable to shareholders is forecasted to be 228 million RMB in 2024, 324 million RMB in 2025, and 408 million RMB in 2026 [2] - EPS is projected to be 0.19 RMB in 2024, 0.28 RMB in 2025, and 0.35 RMB in 2026 [2] Valuation - The report gives a 2025 PE multiple of 35x, corresponding to a target price of 9.8 RMB [1] - Current price is 7.11 RMB as of November 1, 2024 [3]