BIDU(BIDU) 招银国际·2025-04-28 02:21Investment Rating - The report maintains a "Buy" rating for Baidu with a target price of 90.74 [2][9]. Core Insights - Baidu is actively promoting its business transformation by integrating more generative AI-related search results to enhance user experience and engagement. Although the monetization of these search results has not yet begun, it is expected to start by the end of Q2, which should help boost advertising revenue growth and operating profit margins [9]. - The company has introduced several AI applications, including the Wenxin large model 4.5 Turbo and X1 Turbo, which feature multi-modal capabilities, strong reasoning, and reduced costs. The input price for the Wenxin 4.5 Turbo is only 0.8 RMB per million tokens, and the output price is 3.2 RMB, marking an 80% price reduction compared to its predecessor [9]. - Baidu's cloud business is anticipated to maintain strong revenue growth driven by increasing demand for digitalization and AI solutions, supporting overall revenue growth for the group [9]. Financial Summary - The financial forecast for Baidu shows expected sales revenue of 137,622 million RMB in FY25, with a projected growth rate of 3.4%. The adjusted net profit is expected to be 26,943.5 million RMB, reflecting a slight decrease of 0.2% [10][11]. - The company’s operating profit is projected to be 21,430 million RMB in FY25, with a slight increase in operating margin to 15.6% [11]. - Baidu's total assets are expected to grow from 427,780 million RMB in FY24 to 457,698 million RMB in FY25, indicating a healthy balance sheet [11].