Digital China(000034) 首创证券·2024-04-08 16:00Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The company reported a revenue of 119.62 billion yuan in 2023, a year-on-year increase of 3.23%, and a net profit attributable to shareholders of 1.17 billion yuan, up 16.66% year-on-year [2][3] - The company's cloud and self-owned brand strategic businesses experienced rapid growth, with total revenue from these two strategic businesses exceeding 10 billion yuan for the first time, growing by 42% year-on-year [2] - The company is embracing generative AI, establishing a new layout of "domestic computing power + intelligent computing," and has made significant advancements in product development and supply chain [2] - The distribution business remains solid, achieving revenue of 108.85 billion yuan in 2023, a slight increase of 0.53% year-on-year [2] Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 1196.24 billion yuan and a net profit of 11.72 billion yuan, with a significant increase in non-recurring net profit by 37.22% [2][3] - The company expects revenues of 1281.04 billion yuan, 1372.91 billion yuan, and 1498.23 billion yuan for 2024, 2025, and 2026 respectively, with net profits projected at 14.26 billion yuan, 16.42 billion yuan, and 19.87 billion yuan [2][3] Strategic Business Growth - The cloud business generated revenue of 69.31 billion yuan, up 37.98% year-on-year, with high-margin cloud integration services growing by 68.25% [2] - The self-owned brand business capitalized on the development opportunities in the domestic innovation sector, achieving revenue of 38.29 billion yuan, a year-on-year increase of 48.95% [2] Future Outlook - The company is expected to continue its growth trajectory with a projected EPS of 2.13 yuan, 2.45 yuan, and 2.97 yuan for the years 2024, 2025, and 2026 respectively [3] - The company maintains a stable gross margin and focuses on high-value, high-margin businesses in its distribution operations [2]