Chinasoft International Ltd (CFTLF)

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Citi: China Software International reiterates its buy rating target price rises to 18.5 Hong Kong dollars.

source
https://finance.sina.com.cn/stock/hkstock/hkgg/2021-08-11/doc-ikqcfncc2208087.shtml

August 11, 2021 12:29 Sina Hong Kong Stocks

Citi issued a research report saying that it reiterated China Software International "Buy" rating, the target price was raised from 13.1 Hong Kong dollars to 18.5 Hong Kong dollars, and 2021-23 revenue and profit forecasts were adjusted to 0 %-3%.

According to the report, it is estimated that the company's revenue growth in the first half of the year will be slightly better than expected, and profit growth will be rapid, mainly due to the expansion of gross profit margin. Considering the acceleration of Hongmeng's user adoption and the recent increase in cooperation with Huawei, it is believed that the company's business is fast increase.

The bank said that in terms of interim results, its revenue is expected to increase by 33% year-on-year to RMB 8.06 billion (the same below), and gross profit margin is expected to improve year-on-year. However, part of the impact is offset by the increase in marketing expenses. Net profit will rise 37% year-on-year to 550 million yuan. According to media reports, as of August 6, Huawei Hongmeng has more than 50 million users. Huawei will increase its user target from 300 million to 400 million by the end of this year. It is believed that Hongmeng’s main partners include ChinaSoft International.