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Beijing Thunisoft:Earnings in Line with Expectations,Strong Growth Potential

发布时间:2016-02-23    研究机构:兴业证券

Company Profile

Beijing Thunisoft Corporation Ltd. develops and provides services for e-governmen tsystem software. The Company's main products are software systems for courts, taxdepartments and general sectors.

Event

Beijing Thunisoft Co., Ltd. released its 2015 annual report, stating that it made CNY1.352 billion in revenue in 2015, up 49.75% YoY. The net profit stood at CNY 208million, an increase of 41.44% compared to a year earlier. The Company was going togive out CNY 1 stock dividend per 10 shares and increase share capital by 100% fromaccumulation fund.

Comment

Revenue from providing information and system services to courts and procuratoratesgrew by 36.62% YoY and 30.21% YoY respectively to CNY 757 million and CNY 209million last year. Services related to food security contributed CNY 117 million income,rising by 71.6% YoY. And Beijing Thunisoft made over CNY 100 million in revenue in bigdata business last year. In addition, there are CNY 1.5 billion orders to be implementedin 2016, setting up sound foundations for sustainable high-speed growth.

Beijing Thunisoft conducted series of M&As last year and achieved good results inthese transactions. Earnings of Pudong Zhong Ruan, Wanhu Network and ThunsoftCredit all beat their commitment (CNY 23 million, CNY 30 million and CNY 22.08million) made previously with CNY 23.86 million, CNY 30.91 million and CNY 22.44million. (Beijing Thunisoft purchased 100% stake, 100% stake and 49% stakerespectively in the three companies.) We believe Beijing Thunisoft will move forward tobreak into new segments of government related business through acquiring leadingtargets in these fields, forming more comprehensive competitiveness on the market.

Supreme People’s Court and Supreme People’s Procuratorate both rolled out policiesto boost wider application of information systems. And Food Safety Law was officially launched on Oct 1 last year. Big data and establishment of autonomous & controllablesystems are also expected to bring about development opportunities for the Company.

Beijing Thunisoft announced a private placement plan the end of 2015, intending toraise CNY 1.07 billion to meet the increased demand.

Earnings Forecast and Investment Recommendations: We made EPS forecast forthe Company at CNY 0.90 in 2015, CNY 1.19 in 2016 and CNY 1.56 in 2017. ReiterateOUTPERFORM.

Potential Risks: intensified competition in the industry, M&A and R&D generateworse-than-expected results.

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