Event: On December 19, on the occasion of the 19th anniversary of the listing of Wasion Holdings Limited, Wasion Information successfully held its annual Innovation Summit and Investor Research Conference. At the meeting, the company signed a strategic cooperation agreement with a number of top universities and scientific research institutions, and jointly established three major consortia: new energy system and smart grid innovation, digital city simulation innovation, and artificial intelligence supercomputing innovation.

R&D and innovation inject new momentum into development, and carry out "chip + artificial intelligence" cooperation with Huairou Laboratory. In 2024, against the backdrop of the restructuring of the global manufacturing industry, the surge in demand for AI computing power, and the transformation of the new energy system, Wasion Information has successfully launched more than 30 innovative products and solutions to meet the needs of the market for digitalization and intelligence. In the first half of 2024, the company will carry out "chip + artificial intelligence" cooperation with Huairou Laboratory, a state-level new scientific research institution in the energy field approved by the central government, to implement the industrialization of scientific research results. The company has established a joint project team with the research center of the new power system of Huairou Laboratory to develop AI-based advanced SOC chips and devices for the digital scenario of power distribution and consumption in the new power system, improve the value of core products in software and hardware, and promote the digitalization and intelligence of power. In the first three quarters of 2024, the company's R&D investment was 176 million yuan, accounting for 9.1% of revenue; There are 447 R&D personnel, accounting for 51.3% of the total.

Actively promote the application of artificial intelligence, and integrate it into the construction of new power systems and digital smart cities. As the vice chairman unit of the Artificial Intelligence Alliance of the Power Industry, the company actively promotes the application of artificial intelligence technology in the field of power and new energy. For example, at present, the company is focusing on the key technology of the transparent station area of the new power system, through the edge of the intelligent equipment for real-time communication and information collection of hundreds of meters, through artificial intelligence technology to monitor and predict the situation, and finally achieve the effect of optimal control, so as to improve the operation efficiency and safety of the power grid.

The chip business is progressing smoothly, and it continues to win bids to consolidate the cornerstone of performance. The company's Zhuhai Zhonghui's high-speed power line carrier and wireless dual-mode communication chip WTZ30 won the 19th "China Chip" and "Excellent Market Performance Product" award, and the company's chip module has grown strongly and has become the company's primary product. Self-developed chips cover domestic finance? Internationally, the high-speed broadband carrier communication technology and chips of the power Internet of Things have been internationally recognized, and the new generation of dual-mode communication chips have passed the testing and certification of the State Grid and China Southern Power Grid, and the market share has continued to increase; Wi-SUN communication module technology has passed the evaluation of scientific and technological achievements, and a number of products have obtained international certification, which can provide power AMI communication solutions for more than 70% of the world's countries. Recently, in the 80th batch of bidding projects of the State Grid Headquarters in 2024, Wasion Information won the bid of 86 million yuan, and the State Grid Headquarters won the bid of 218 million yuan for centralized procurement throughout the year, which reflects the company's strong competitiveness and is conducive to the stable growth of future revenue stream and business.

Investment suggestion: The company takes "the world of things, the future of the core" as its development strategy, focuses on digital power grids and digital smart cities, and has the ability to provide comprehensive solutions at all levels of the energy Internet of Things. In addition, the company actively grasps overseas development opportunities, and the coverage area is gradually spreading to blue ocean markets such as the Arab region, and the revenue of overseas markets is expected to continue to grow rapidly. We expect that the company's net profit attributable to the parent company from 2024 to 2026 will be 6.55/8.43/1.096 billion yuan respectively, with the corresponding growth rate of 25%/29%/30% and the corresponding PE of 27.7 X/21.5X/16.5X respectively, maintaining the "highly recommended" investment rating.

Risk warning: the risk of international exchange rate fluctuations, the risk of market expansion being less than expected, the risk of downstream capital expenditure being lower than expected, and the risk of intensifying market competition.