研究报告全文：MN2Mar2023CMBInternationalGlobalMarketsEquityResearchCompanyUpdateChinasoft354HKUSisreviewingHuaweiexportlicensepolicyTargetPriceHK914AccordingtoWSJtheBidensadministrationisreviewingHuaweiexportlicensePreviousTPHK914policyTheUSmaynotgrantnewlicensestoUScompaniesegQualcommUpDownside531IntelforsalestoHuaweiovernationalsecurityconcernsThenewactionwouldCurrentPriceHK597extendthecoveredproductsfrom5Gtechnologytoevenolder4GproductsWethinkthiscouldaffectHuaweisproductdevelopmentroadmapandthusChinaSoftwareITServicesChinasoftsrevenueandmarginoutlookSuggestinvestorstofocusonmarginMarleyNGANtrendinMarresultsannouncement85239163719marleyngancmbicomhkUSmayfurtherrestrictexportstoHuaweiincludingolder4GproductsWSJreportedthattheBidensadministrationisconsideringrevokingexportBowenLIlicenseissuedtoUSsuppliersegQualcommIntelforsalestoHuawei85237618957overnationalsecurityconcernsHuaweiwasplacedontheEntityListsincelibowencmbicomhk2019butthattechnologybelow5GcouldbesoldtoHuaweibyUSsuppliersunderexistingrulesThenewactionwouldextendthecoveredproductsfromStockData5Gtechnologytoevenolder4GproductsAccordingtothenewstheWhiteMktCapHKmn170421Avg3mthstoHKmn67HouseistellingCommercetocutoffthe4GsalesofHuaweiAccordingto52wHighLowHK817483CommerceDepartmentsspokesmantheCommerceapprovedroughlyTotalIssuedSharesmn3027070oftheexportcontrollicenseapplicationslastyearinvolvingChinaOnSourceFactSettheotherhandBIShasapprovedHuaweilicensesvaluedatUS614bnShareholdingStructurebetweenNov2020andApr2021afterHuaweibeingputintotheEntityListChenYuhong-Chairman108HuaweiproductdevelopmentplancouldbeaffectednegativetoUBSGroupAG100SourceHKExChinasoftrevenueandmarginWethinkthemoveimpliesaheightenedUS-ChinatensionAlthoughHuaweishouldhavepiledupinventoryfortheSharePerformanceshort-termusebutitmayhurtHuaweisproductdevelopmentplanChinasoftAbsoluteRelativeprovidesITservicessuchassoftwareandhardwareproductdevelopment1-mth-180-953-mth-151-202testinglifecyclemanagementetctoHuaweiTheCompanyderived546-mth-88-80ofrevenuefromHuaweiinFY21basedonourestimateThepotentialnewSourceFactSetrestrictionsmayaffectHuaweisproductdevelopmentroadmapandhence12-mthPricePerformancerevenueandmargintoChinasoftSharepricecouldbeunderpressureintheneartermwaituntilmorecolorsonmarginWhilewearepositiveonthelong-termsoftwarelocalizationtrendandenterprisesITspendingrecoverypostCOVIDweareconcernedtheearningsdownsideriskthatHuaweimaysqueezesuppliersmarginfurtheramidtougherbusinessenvironmentWehavenotadjustedourearningsforecastMaintainBUYwithunchangedtargetpriceofSourceFactSetHK914EarningsSummaryRelatedReportsYE31DecFY20AFY21AFY22EFY23EFY24E1Chinasoft354HKBenefitingRevenueRMBmn1410118398208652443627773fromlocalizationtrendwithKaihongOS11Jan2023linkYoYgrowth171305134171137NetprofitRMBmn9549113691171514351167412Chinasoft354HKFY1H22beatworkforcerestructuringinprogressDilutedEPSRMB03203603804605430Aug2022linkYoYgrowth12612953225167ConsensusEPSRMB032036042050061DilutedPEx14926113811397EVSalesx1007050403Yield0503060708ROE12511297108114Netgearing228312436424444SourceCompanydataBloombergCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1MOREREPORTSFROMBLOOMBERGRESPCMBRGOORhttpwwwcmbicomhk2Mar2023FocusChartsFigure1RevenueandgrowthFigure2RevenuemixFY1H22Rmbmn20000451800040Cloud1600035smart1400030business1200032251000020800015TraditionalIT6000outsourcing400010682000500201120132015201720192021RevenueYoYSourceCompanydataCMBIGMestimatesSourceCompanydataCMBIGMestimatesFigure3RevenuemixbycustomerFY1H22Figure4Margins3530Others302520Huawei1551Alibaba103PingAn530TencentHSBCHonor20112012201320142015201620172018201920202021472GPMOPMNPMSourceCompanydataCMBIGMestimatesSourceCompanydataCMBIGMFigure5ForwardrevenueandemployeesgrowthFigure6ChinasoftemployeetrendEmployeesno70100000706090000605080000504070000403060000205000030104000020030000200820102012201420162018202010-1020000100000EmployeesYoY1-yearfwdrevenueYoY0-101H092H101H122H131H152H161H182H191H21SourceCompanydataCMBIGMSourceCompanydataCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE22Mar2023OperatingmodelFigure7OperatingmodelRMBmn202020212022E2023E2024ERevenues1410118398208652443627773Costofsales998313494158041867521085GrossProfit41184904506257606688Grossmargin292267243236241RD9301249134716591855SGA20312699288933113791OperatingIncome95279689711751372Operatingmargin6743434849Non-OperatingIncome83456351382440ProfitBeforeTax10351252124815571812Incometaxexpensegain8711578123140Minorities70212NetIncometoShareholders9551137117114351674Netmargin6862565960EPSRMB033037038046054FullydilutedEPSRMB032036038046054RevenuebreakdownIToutsourcing1083013063137161549917049Emergingcloudbusiness327153357149893710724Huawei8030988099791097712404HSBC8301180135714931642Tencent500706720792951Alibaba400590602662861PingAn450550605666732Others389154927603984711184GrowthYoYRevenues1730131714Grossprofit151931416OperatingIncome15-16133117EPS71322317SourceCompanydataCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE32Mar2023Figure8Semi-annualoperatingmodelRMBmn1H202H201H212H211H222H22E1H23E2H23ERevenues6059804283411005710025108401107813358GrossProfit16492469229426102482258026413119Operatingprofit421531423374485412567608Netprofitloss401554518619572600590846EPSRMB016019019020020019019027MarginsGrossmargin272307275260248238238234Operatingmargin6966513748385146Netmargin6669626257555363GrowthHoHRevenues-73342108221GrossProfit-1850-714-54218Operatingprofit526-20-1230-15387Netprofitloss238-620-85-243GrowthYoYRevenues92438252081123GrossProfit5223968-1621Operatingprofit-1320-3015101748Netprofitloss1141291210-3341SourceCompanydataCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE42Mar2023ValuationChinasoft354HKBUYTPHK914WehavenotadjustedourearningsforecastMaintainBUYwithtargetpriceofHK914basedon15xfullydilutedFY24EPEin-linewith3yearmeanFigure9PeersvaluationSalesEPSMkCapPriceTPPEROECAGRCAGRCompanyTickerRatingUSmnLCLCFY23EFY24EFY23EFY24EFY21-24FY21-24Chinasoft354HKBUY2758712914113971081141513iSoftStone301236CHNR36453885NA1371031611742229DigitalChina000034CHNR22292274NA153129159162980InfosysINFOINNR76007148070NA2542203213451814TataConsultancyTCSINNR150111334490NA2922564474651515Mean1891592402541630Median1381531291611715SourceBloombergCMBIGMFigure1012MforwardPEbandFigure1112MforwardPBbandxHK3525302025152015101055--Jul-20Jul-21Jul-22Jan-23Jan-21Jan-22Mar-20Mar-21Mar-22Nov-20Sep-20Sep-21Nov-21Sep-22Nov-22May-20May-21May-22Jul-20Jul-21Jul-22Jan-21Jan-22Jan-23Mar-20Mar-21Mar-22Nov-22Sep-20Nov-20Sep-21Nov-21Sep-22May-21May-22May-20ClosingPx64x125x1-yrfwdPEMeanMean1SDMean-1SD186x247x309xSourceCompanydataCMBIGMSourceCompanydataCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE52Mar2023FinancialSummaryINCOMESTATEMENT2019A2020A2021A2022E2023E2024EYE31DecRMBmnRevenue120421410118398208652443627773Costofgoodssold8459998313494158041867521085Grossprofit358341184904506257606688Operatingexpenses275631674108416545865316Sellingexpense618729943106412461416Adminexpense119613021756182520652374RDexpense8099301249134716591855Others13420515970385329Operatingprofit82795279689711751372Interestexpense1661511001108595Others138235555461467535Pre-taxprofit79910351252124815571812Incometax428711578123140Minorityinterest270212Netprofit7559551137117114351674BALANCESHEET2019A2020A2021A2022E2023E2024EYE31DecRMBmnCurrentassets81981039413520140791629818362Cashequivalents252637875556751082019342Restrictedcash329745805894484359906700Othercurrentassets237520272069172721082320Non-currentassets254726933383347635033527PPE8028581220101410941169Intangibles1101108610371021968917Othernon-currentassets6437491126144014401440Totalassets107451308716902175551980121889Currentliabilities315027183986473256516189Short-termborrowings1523368917202722992474Accountpayables122917532252246330533382Othercurrentliabilities397597817242298333Non-currentliabilities106215921290215215215Long-termborrowings92814211021000Othernon-currentliabilities134171269215215215Totalliabilities421143115276494758666404Sharecapital116132139139139139Capitalsurplus314547356294622362236223Retainedearnings367744925760677881059655Otherreserves471605589554554554Totalshareholdersequity6468875311604125861391315463Minorityinterest662323222222Totalequityandliabilities107451308716902175551980121889PLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE62Mar2023CASHFLOW2019A2020A2021A2022E2023E2024EYE31DecRMBmnOperatingProfitbeforetaxation79910351252124815571812Depreciationamortization197170221140123126Taxpaid84832078123140Changeinworkingcapital5165338871043882559Others35856439636700Netcashfromoperations754115396227206751239InvestingCapitalexpenditure105159287150150150Others120322426015351Netcashfrominvesting224192530751203201FinancingDividendpaid48527088108125Netborrowings5221717388273175Others653196127437012Netcashfromfinancing650362137736916652NetchangeincashCashatthebeginningoftheyear264625263787555675108201Exchangedifference162403545351Cashattheendoftheyear252637875556751082019342GROWTH2019A2020A2021A2022E2023E2024EYE31DecRevenue138171305134171137Grossprofit10414919132138161Operatingprofit15151163126310168Netprofit5526519130225167PROFITABILITY2019A2020A2021A2022E2023E2024EYE31DecGrossprofitmargin298292267243236241Operatingmargin696743434849ReturnonequityROE12112511297108114GEARINGLIQUIDITYACTIVITIES2019A2020A2021A2022E2023E2024EYE31DecNetdebttoequityx000203040404Currentratiox263834302930Receivableturnoverdays98611691153836882868Inventoryturnoverdays231944424443Payableturnoverdays878734523632601561VALUATION2019A2020A2021A2022E2023E2024EYE31DecPE11412523012910590PEdiluted12314926113811397PB141625121110Divyield060503060708EV188351169128152919134270130085120418EVSales161208050403SourceCompanydataCMBIGMestimatesNoteThecalculationofnetcashincludesfinancialassetsPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE72Mar2023DisclosuresDisclaimersAnalystCertificationTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportinwholeorinpartcertifiesthatwithrespecttothesecuritiesorissuerthattheanalystcoveredinthisreport1alloftheviewsexpressedaccuratelyreflecthisorherpersonalviewsaboutthesubjectsecuritiesorissuerand2nopartofhisorhercompensationwasisorwillbedirectlyorindirectlyrelatedtothespecificviewsexpressedbythatanalystinthisreportBesidestheanalystconfirmsthatneithertheanalystnorhisherassociatesasdefinedinthecodeofconductissuedbyTheHongKongSecuritiesandFuturesCommission1havedealtinortradedinthestockscoveredinthisresearchreportwithin30calendardayspriortothedateofissueofthisreport2willdealinortradeinthestockscoveredinthisresearchreport3businessdaysafterthedateofissueofthisreport3serveasanofficerofanyoftheHongKonglistedcompaniescoveredinthisreportand4haveanyfinancialinterestsintheHongKonglistedcompaniescoveredinthisreportCMBIGMRatingsBUYStockwithpotentialreturnofover15overnext12monthsHOLDStockwithpotentialreturnof15to-10overnext12monthsSELLStockwithpotentiallossofover10overnext12monthsNOTRATEDStockisnotratedbyCMBIGMOUTPERFORMIndustryexpectedtooutperformtherelevantbroadmarketbenchmarkovernext12monthsMARKET-PERFORMIndustryexpectedtoperformin-linewiththerelevantbroadmarketbenchmarkovernext12monthsUNDERPERFORMIndustryexpectedtounderperformtherelevantbroadmarketbenchmarkovernext12monthsCMBInternationalGlobalMarketsLimitedAddress45FChampionTower3GardenRoadHongKongTel85239000888Fax85239000800CMBInternationalGlobalMarketsLimitedCMBIGMisawhollyownedsubsidiaryofCMBInternationalCapitalCorporationLimitedawhollyownedsubsidiaryofChinaMerchantsBankImportantDisclosuresTherearerisksinvolvedintransactinginanysecuritiesTheinformationcontainedinthisreportmaynotbesuitableforthepurposesofallinvestorsCMBIGMdoesnotprovideindividuallytailoredinvestmentadviceThisreporthasbeenpreparedwithoutregardtotheindividualinvestmentobjectivesfinancialpositionorspecialrequirementsPastperformancehasnoindicationoffutureperformanceandactualeventsmaydiffermateriallyfromthatwhichiscontainedinthereportThevalueofandreturnsfromanyinvestmentsareuncertainandarenotguaranteedandmayfluctuateasaresultoftheirdependenceontheperformanceofunderlyingassetsorothervariablemarketfactorsCMBIGMrecommendsthatinvestorsshouldindependentlyevaluateparticularinvestmentsandstrategiesandencouragesinvestorstoconsultwithaprofessionalfinancialadvisorinordertomaketheirowninvestmentdecisionsThisreportoranyinformationcontainedhereinhavebeenpreparedbytheCMBIGMsolelyforthepurposeofsupplyinginformationtotheclientsofCMBIGMoritsaffiliatestowhomitisdistributedThisreportisnotandshouldnotbeconstruedasanofferorsolicitationtobuyorsellanysecurityoranyinterestinsecuritiesorenterintoanytransactionNeitherCMBIGMnoranyofitsaffiliatesshareholdersagentsconsultantsdirectorsofficersoremployeesshallbeliableforanylossdamageorexpensewhatsoeverwhetherdirectorconsequentialincurredinrelyingontheinformationcontainedinthisreportAnyonemakinguseoftheinformationcontainedinthisreportdoessoentirelyattheirownriskTheinformationandcontentscontainedinthisreportarebasedontheanalysesandinterpretationsofinformationbelievedtobepubliclyavailableandreliableCMBIGMhasexertedeveryeffortinitscapacitytoensurebutnottoguaranteetheiraccuracycompletenesstimelinessorcorrectnessCMBIGMprovidestheinformationadvicesandforecastsonanASISbasisTheinformationandcontentsaresubjecttochangewithoutnoticeCMBIGMmayissueotherpublicationshavinginformationandorconclusionsdifferentfromthisreportThesepublicationsreflectdifferentassumptionpoint-of-viewandanalyticalmethodswhencompilingCMBIGMmaymakeinvestmentdecisionsortakeproprietarypositionsthatareinconsistentwiththerecommendationsorviewsinthisreportCMBIGMmayhaveapositionmakemarketsoractasprincipalorengageintransactionsinsecuritiesofcompaniesreferredtointhisreportforitselfandoronbehalfofitsclientsfromtimetotimeInvestorsshouldassumethatCMBIGMdoesorseekstohaveinvestmentbankingorotherbusinessrelationshipswiththecompaniesinthisreportAsaresultrecipientsshouldbeawarethatCMBIGMmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreportandCMBISwillnotassumeanyresponsibilityinrespectthereofThisreportisfortheuseofintendedrecipientsonlyandthispublicationmaynotbereproducedreprintedsoldredistributedorpublishedinwholeorinpartforanypurposewithoutpriorwrittenconsentofCMBIGMAdditionalinformationonrecommendedsecuritiesisavailableuponrequestForrecipientsofthisdocumentintheUnitedKingdomThisreporthasbeenprovidedonlytopersonsIfallingwithinArticle195oftheFinancialServicesandMarketsAct2000FinancialPromotionOrder2005asamendedfromtimetotimeTheOrderorIIarepersonsfallingwithinArticle492atodHighNetWorthCompaniesUnincorporatedAssociationsetcoftheOrderandmaynotbeprovidedtoanyotherpersonwithoutthepriorwrittenconsentofCMBIGMForrecipientsofthisdocumentintheUnitedStatesCMBIGMisnotaregisteredbroker-dealerintheUnitedStatesAsaresultCMBIGMisnotsubjecttoUSrulesregardingthepreparationofresearchreportsandtheindependenceofresearchanalystsTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportisnotregisteredorqualifiedasaresearchanalystwiththeFinancialIndustryRegulatoryAuthorityFINRATheanalystisnotsubjecttoapplicablerestrictionsunderFINRARulesintendedtoensurethattheanalystisnotaffectedbypotentialconflictsofinterestthatcouldbearuponthereliabilityoftheresearchreportThisreportisintendedfordistributionintheUnitedStatessolelytomajorUSinstitutionalinvestorsasdefinedinRule15a-6undertheUSSecuritiesExchangeActof1934asamendedandmaynotbefurnishedtoanyotherpersonintheUnitedStatesEachmajorUSinstitutionalinvestorthatreceivesacopyofthisreportbyitsacceptancehereofrepresentsandagreesthatitshallnotdistributeorprovidethisreporttoanyotherpersonAnyUSrecipientofthisreportwishingtoeffectanytransactiontobuyorsellsecuritiesbasedontheinformationprovidedinthisreportshoulddosoonlythroughaUS-registeredbroker-dealerForrecipientsofthisdocumentinSingaporeThisreportisdistributedinSingaporebyCMBISingaporePteLimitedCMBISGCompanyRegnNo201731928DanExemptFinancialAdviserasdefinedintheFinancialAdvisersActCap110ofSingaporeandregulatedbytheMonetaryAuthorityofSingaporeCMBISGmaydistributereportsproducedbyitsrespectiveforeignentitiesaffiliatesorotherforeignresearchhousespursuanttoanarrangementunderRegulation32CoftheFinancialAdvisersRegulationsWherethereportisdistributedinSingaporetoapersonwhoisnotanAccreditedInvestorExpertInvestororanInstitutionalInvestorasdefinedintheSecuritiesandFuturesActCap289ofSingaporeCMBISGacceptslegalresponsibilityforthecontentsofthereporttosuchpersonsonlytotheextentrequiredbylawSingaporerecipientsshouldcontactCMBISGat6563504400formattersarisingfromorinconnectionwiththereportPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE8