Guoyuan International has issued a research report forecasting that CHINASOFT INT'L (00354) will achieve revenues of RMB 18.185 billion (+6.8%), RMB 19.586 billion (+7.7%), and RMB 21.74 billion (+1.1%) for the years 2026 through 2028, respectively.
Net profit attributable to shareholders is projected to be RMB 584 million (+81.74%), RMB 676 million (+15.7%), and RMB 780 million (+15.4%) for the same period.
The report suggests that the company can unlock future revenue growth by accelerating the expansion of its AI software and hardware business.
Concurrently, the firm is exploring a business model upgrade that involves converting computing power into tokens.
Consequently, the company's future revenue and profit growth potential is viewed as flexible, and a valuation based on a 2026 price-to-earnings (P/E) ratio of 23 times is considered reasonable.
This valuation corresponds to a target price of HK$5.65 per share, representing an approximate 30% upside from the current price, leading to a 'Buy' rating.
Core Analysis Points
In 2025, the company reported operating revenue of RMB 17.027 billion, marking a year-on-year increase of 0.5%, with service income growing by 2.3%.
Sales from its full-stack, full-scenario AI products and services business reached RMB 2.0 billion, surging 109.2% year-on-year, signifying a successful transition to a new role as an enterprise Agentic AI architect and integrator.
Attributable profit to shareholders declined by 37.3% to RMB 321 million, impacted by workforce optimization and goodwill impairment losses.
Adjusted pre-tax profit grew by 0.2%, indicating stable core business profitability.
Focus on Physical AI Business
Leveraging the Harmony (Hongmeng) ecosystem, the company is prioritizing the development of its Physical AI business as part of its 'One Body, Two Wings' strategy.
The AI Harmony business is positioned as the foundation for integrating enterprise AI into the physical world, aiming to provide high-quality data support for AI platforms.
By capitalizing on the dual advantages of KaihongOS and the Meta platform, the company adheres to an integrated software-hardware development strategy and is deeply involved in the large-scale deployment of Harmony-powered smart cities.
Development of the allmeta Operating System
The company is vigorously advancing the research and development of its enterprise intelligent business operating system, allmeta.
The allmeta product system comprises allmetaEcore, allmetaOntology, and allmetaAgentic.
Through a three-tier 'Base-Cognition-Execution' architecture, it creates a closed loop where data nourishes the ontology, the ontology drives actions, and actions, in turn, feed back into data.
This grants enterprises a life-like self-evolution capability, building core competitiveness.
The company is utilizing allmeta to enter sectors like energy, power, and finance, creating digital employees tailored for full-scenario B2B applications and exploring the conversion of computing power into tokens to upgrade its business model.
Risk Factors to Consider
Key risks include the global development trajectory of AI and the potential for the company's business expansion to fall short of expectations.
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