汇丰-中国工业软件：需求温和复苏下亮点犹存-China Industrial Software：Bright Spots Remain amid a Mild Demand Recovery-20251224

4ZHSBCG。balnvestmentResearch

24December2025EquityResearchReport

ChinaIndustrialSoftware

Equities

Software

Brightspotsremainamidamilddemandrecovery

China

uRecoveryindomesticindustrialdigitalisationdemandislikelytoremainlukewarmin4Q25and2026

uPrefercompanieswithoverseasexpansionpotentialandthoseservingdownstreamindustrieswithlesscompetitiveintensity

uUpgradeLongshinetoBuy(fromHold)andmaintainBuyratingsonBaosightandBOCHU,allwithlowerTPs

Milddemandrecoverylikelytocontinue;brightspotsinselectverticals.The

overallindustrialdigitalisationdemandremainedlukewarmin9M25,andmany

softwareplayerswitnessedlowcapexwillingnessordelayedprojectimplementations.SharepricesofBaosightandBOCHUcorrected29%and4%YTD,respectively,whilethesharepriceofLongshinerose26%YTD(vsCSI300up17%YTD)ondivergentresults.Lookingaheadinto4Q25and2026,weexpectmilddemandrecoverytocontinueinChina’sindustrialsoftwaresectorifthereisnomeaningfulpickupinmacroeconomicmomentum.However,selectverticalswithlowcompetitiveintensityshouldstandout.Wecontinuetoseesolidgriddigitalisationdemanddrivenbyimprovingnewenergypenetrationandnewelectricitysystemconstructionrollouts,whilewebelievesteel

digitalisationdemandmightremainweakduetodestockingandintensecompetitionindownstreamsectors.Againstthisbackdrop,wepreferindustrialsoftwareplayerswith1)overseasexpansionpotential(e.g.,BOCHU)and2)largerexposuretomoredefensivedownstreamsectors,suchasutilities(e.g.Longshine).

PreferLongshine(upgradetoBuyfromHold).WepreferLongshine(lowerTPtoRMB19.00fromRMB22.00),asweexpectrobustearningsrecovery(2025-27enet

profitCAGRof42%),drivenbysteadygrowthinitsgriddigitalisationbusiness,the

EVchargingplatformnearingbreakeven,androbustgrowthinpowertrading.In

addition,Longshine’svaluationlooksattractiveposttherecentcorrectionasitisnowtradingata0.6x2026PEG(vsthepeeraverageof0.8x).WealsolikeBOCHU’s

continuedoverseasexpansionandsmoothprogressinsmartwelding(lowerTPto

RMB153.00fromRMB160.71).ForBaosight(lowerTPtoRMB23.00fromRMB32.00),wepreviouslyunderestimatedtheimpactfromdestockinginthedownstreamsteel

industryanditsrelatedrevenuein11M25missedourexpectations.Wenowbelievethatsteeldigitalisationmightfaceshort-termdemandpressure,andwelowerour

2025-27softwaredevelopmentrevenueby32-37%,leadingtoa30-31%cutinour2025-27netprofit.However,westillexpecta16%netprofitCAGRover2025-27,

andremainpositiveonitslong-termearningsoutlook,aswebelievethecompanyiswell-positionedtobenefitfromdigitalisationinthesteelindustryandAItrends.Seedetailedearningsrevisions,valuation,andrisksinthecompanysection.

YiranLiu*(Reg.No.S1700520040001)

HeadofA-shareITSoftwareResearch

HSBCQianhaiSecuritiesLimited

yiran1.liu@

+861057952349

HengZhang*(Reg.No.S1700524050001)

Analyst,A-shareITSoftwareResearch

HSBCQianhaiSecuritiesLimited

heng.zhang@

+861057952384

*Employedbyanon-USaffiliateofHSBCSecurities(USA)Inc,andisnotregistered/qualifiedpursuanttoFINRAregulations

Pushingtheacceleratorinto2026

The22ndeditionoftheEMSentimentSurvey

Clicktoview

Exhibit1.Summaryofchangesinnetprofitestimates,targetprice,andratings

____________________Netprofitestimates(RMBm)__________________

Current_______TP____________Rating_____Upside/________2025e_____________2026e_______________2027e_______

CompanyTickerCurrencypriceOldNewOldNewDownsideOldNewDiff%OldNewDiff%OldNewDiff%

Longshine300682CHRMB15.2122.0019.00HoldBuy25%519446-14%708666-6%8809043%

BOCHU688188CHRMB131.39160.71153.00Baosight600845CHRMB20.3832.0023.00

BuyBuy

BuyBuy

16%1,1111,067-4%1,3611,297-5%1,6731,582-5%13%2,6571,861-30%3,0652,151-30%3,6432,501-31%

Source:Wind,HSBCQianhaiSecuritiesestimates.Note:Pricedatcloseof22December2025.

Disclosures&Disclaimer

ThisreportmustbereadwiththedisclosuresandtheanalystcertificationsintheDisclosureappendix,andwiththeDisclaimer,whichformspartofit.

Issuerofreport:HSBCQianhaiSecuritiesLimited

ViewHSBCQianhaiSecuritiesat:

2

4

HSBCQianha

https://www

Equities●Software24December2025

Longshine(300682CH,UpgradetoBuy,TPRMB19.00)

Estimatechanges

Our2026-27totalrevenueestimatesarelargelyunchanged.Wemarginallylowerour2025revenueestimatesby1%tofactorinaloweronlineutilitypaymenttradingvolumeandEVchargingvolumein11M25.Weraiseour2027grossmarginestimatesby1ppt,asweexpectbetterpricingforthe

EVchargingplatformbusinessoverthemediumtermgivenstabilisingcompetition.

Inaddition,giventhenewchargingpilerealworldassets(RWAs)andelectricitytrading

businessmightrequiremoreinvestmentandresources,weraiseour2025,2026and2027coreexpenseratioestimates(selling,administrative,andR&Dexpensescombined)by1.5ppt,

0.8pptand0.5ppt,respectively.

Aftertheabovechanges,welowerour2025and2026netprofitestimatesby14%and6%,respectively,andraiseour2027netprofitestimatesby3%.

Exhibit2.Revenueestimatechanges,bysegment

2025e

2026e

2027e

_________

___

_________

_________

___

_________

_________

___

_________

(RMBm)

Old

New

Change

Old

New

Change

Old

New

Change

Energydigitalisation

2,184

2,184

0%

2,293

2,293

0%

2,408

2,408

0%

EnergyInternet

2,135

2,103

-1%

2,493

2,486

0%

2,852

2,856

0%

InternetTV

439

439

0%

443

443

0%

452

452

0%

Totalrevenue

4,758

4,726

-1%

5,230

5,222

0%

5,712

5,716

0%

Source:HSBCQianhaiSecuritiesestimates

Exhibit3.Revenueandearningsestimatechanges

2025e2026e2027e

(RMBm)OldNewChangeOldNewChangeOldNewChange

Revenue4,7584,726-1%5,2305,2220%5,7125,7160%

Costs2,4902,475-1%2,6742,6710%2,8832,830-2%

Grossprofit2,2682,251-1%2,5552,5510%2,8282,8862%

Sellingexpenses7177302%7497632%7857992%

Administrativeexpenses4735138%4925175%5215383%

R&Dexpenses5185241%5695690%6116110%

Financingexpenses-4-4-3%-3-2-21%-5-4-24%

Taxandextracharges2625-1%28280%31310%

Assetimpairmentlosses4847-1%37370%29290%

Otheroperatingincome49490%52520%55550%

Operatingprofit540465-14%735692-6%9139373%

Non-operatingincome110%110%110%

Non-operatingexpenses660%660%660%

Profitbeforetax535460-14%730687-6%9079313%

Incometax55-14%77-6%993%

Profitaftertax530455-14%723680-6%8989223%

MinorityInterest119-14%1414-6%18183%

Netprofit519446-14%708666-6%8809043%

Source:HSBCQianhaiSecuritiesestimates

HSBCQianhaiSecuritiesestimatesversusconsensus

Our2025-27revenueestimatesand2025netprofitestimatesarebelowconsensus,aswearemorecautiousontheInternetTVhardwareandnon-gridenergydigitalisationbusinesses.

However,asLongshine’ssharepricehascorrected39%sincethebeginningofSeptember(vsCSI300up3%overthesameperiod),webelievetheaforementionedheadwindshavebeen

pricedin.Inaddition,our2026-27netprofitestimatesareaboveconsensusaswearemoreoptimisticonLongshine’sgrossmarginexpansionandexpensecontrol.

3

HSBC

Qianhai

https://www

Equities●Software24December2025

Exhibit4.HSBCQianhaiSecuritiesestimatesversusWindconsensus

(RMBm)

HSBC

Qianhaiest

imates

W

indconsensus

2027e

2025e

Difference

2026e

2027e

___2025e

2026e

2027e

2025e

2026e

Revenue

4,726

5,222

5,716

4,994

5,904

7,119

-5.4%

-11.6%

-19.7%

Netprofit

446

666

904

473

656

877

-5.7%

1.6%

3.1%

Source:Wind,HSBCQianhaiSecuritiesestimates

Earningssensitivityanalysis

Weanalysethesensitivityofnetprofittovariationsinthegrossmargin.Asillustratedbelow,every1pptchangeinthegrossmarginmayleadtoa6-9%changeinnetprofitinthesamedirection.

Exhibit5.Sensitivityanalysisofestimatednetprofitattributabletotheparent

_____________________________________

Changesinnetprofitattributabletotheparent

Changesingrossmargin

2025e

2026e

2027e

+1ppt

9.2%

7.5%

6.2%

0ppt

0.0%

0.0%

0.0%

-1ppt

-8.6%

-6.9%

-6.5%

Source:HSBCQianhaiSecuritiesestimates

UpgradetoBuy(fromHold);lowerPEmultiple-basedtargetpricetoRMB19.00(from

RMB22.00)

WecontinuetouseatargetPEmultipleandrefertotheA-sharepeergroup’svaluationsto

valuethestock.WeestimateLongshine’sEPSCAGRat42%over2025-27(from30%)versusthepeergroup’saverageof28%.Notethatthepeergroup’saverage2026ePEmultipleis21x;therefore,weapplyatargetPEmultipleof31x(42/28*21;from33x)tovalueLongshine.

Basedonour2026EPSestimateofRMB0.61(fromRMB0.65),wearriveatournewtargetpriceofRMB19.00(fromRMB22.00).Ourtargetpriceimplies25%upsidefromthecurrentshareprice.Therefore,weupgradeourratingonthestocktoBuyfromHold.

Longshine’scurrentvaluationlooksattractivetousasitistradingata0.6x2026PEG(vspeeraverageof0.8x)aftertherecentsharepricecorrection.Weexpectacceleratedearningsgrowthandasharepricerebound,drivenbytheXindiantubusiness’stransitiontoprofitabilitybyend-2025andthecompany’sexitfromtheInternetTVhardwaresegment.

Exhibit6.PowerITcomparablecompanies’valuations

Target

MktCapADTVPricePriceEPSGrowthRevenueGrowth___PE(x)___PS(x)___PEG____ROE___

Ticker

Company

Rating

USDbnUSDm

RMBRMB2025e2026e2025e2026e2025e2026e2025e2026e2026e2025e2026e

300682CH

Longshine*

Buy

2.3

76

19.00

15.21

49%

6%

10%

37

25

3.5

3.1

0.6

6%

9%

600131CH

StateGridInformation&Telecommunication

NR

2.7

26

-

16.05

31%

20%

29%

14%

22

18

2.0

1.8

1.1

12%

13%

688100CH

WillfarInformation

NR

2.5

18

-

36.58

16%

22%

15%

21%

25

20

5.7

4.7

0.9

19%

20%

002335CH

KehuaData

NR

3.9

294

-

53.55

75%

56%

21%

24%

45

29

3.0

2.4

0.6

11%

15%

300001CH

Tgood

NR

3.8

132

-

25.73

27%

29%

15%

18%

23

18

1.5

1.3

0.6

14%

16%

000682CH

DongfangElectronics

NR

2.2

44

-

11.67

24%

20%

17%

17%

19

15

1.8

1.5

0.8

15%

15%

A-shareaverage2.99834%33%17%17%28212.92.50.813%15%

Note:Pricedasof22December2025.*CoveredbyHSBCQianhaiSecuritiesandHSBCQianhaiSecuritiesestimatesareused.NR-NotRated.NA-NotApplicable/Available.NM-NotMeaningful.

Source:Bloomberg,Windconsensus(forNotRatedstocks),HSBCQianhaiSecuritiesestimatesforcoveredstocks.

4

HSBC

Qianhai

https://www

Equities●Software

24December2025

Exhibit7.Longshine:One-yearforwardPEband

90

80

70

60

50

40

30

20

10

60%

50%

40%

30%

20%

10%

0%

-10%

-20%

-30%

-40%

-50%

Jan-20Jul-20Jan-21Jul-21Jan-22Jul-22Jan-23Jul-23Jan-24Jul-24Jan-25Jul-25Jan-26Jul-26Jan-27Jul-27

Earningsgrowth(RHS)PEMean+1SD-1SD

Source:Wind,companydata,HSBCQianhaiSecuritiesestimates

Note:Weexclude2023-24dataasLongshinereportednetlossin2024.

Potentialsharepricecatalysts

uTheXindiantuplatformachievingbreakevenin2025:WeexpecttheXindiantuplatformtoachievebreakevenin2025,backedbyabettercustomermix(moreprivatevehicleridersandlessprice-sensitivecommercialvehicleriders)andimprovingEVpenetration.This

shouldbringmarginexpansionandlowermarketingexpenses,drivingavaluationre-ratingofthestock.

uTheintroductionoffavourablepolicies.Weexpectthegovernmenttocontinueto

introducefavourablepoliciestoaccelerategriddigitalisationandimplementmarket-basedelectricitypricetransactions,whichshouldincreasedemandforsoftwareupgradesofgridsoverthemid-to-longterm.

Keydownsiderisks

uConcentrationofmajorclients:Thecompany’sdownstreamclientsarehighlyconcentrated,withthetopfiveclientsrepresenting66%,60%and54%ofitstotalrevenuein2022,2023and2024,respectively.Changesinordersbyasinglemajorclientmayleadtovolatile

revenueforLongshine.

uTougher-than-expectedindustrycompetition:Industrypeerswithstate-owned

enterprisebackgroundmayhaveadvantagesinordergainsoverLongshine,giventheiraffiliationwithgovernment-ownedgridcompanies.Ifmorestate-ownedsoftware

companiesenterthemarket,competitioncouldintensifyforLongshine.

uGoodwillimpairmentrisk:Asofend-2024,Longshine’sgoodwillwasRMB1.15bn,c12%ofitstotalassets.Potentialgoodwillimpairmentmayleadtolower-than-expectednetprofit.

uMajorshareholdersellingshares:YueQiCapital(IDG),Longshine’smajorearly-stageinvestor,heldc5%ofLongshine’ssharesasofend-3Q25.IDGisaprivateequityinvestorandinvestedinLongshinein2010.Potentialsalesfrommajorshareholdersmightput

pressureontheshareprice.

5

4

HSBCQianha

https://www

.

Equities●Software24December2025

Financials&valuation:LongshineBuy

Financialstatements

Yearto12/2024a12/2025e12/2026e12/2027e

Profit&losssummary(CNYm)

Revenue

4,479

4,726

5,222

5,716

EBITDA

-252

522

754

1,000

Depreciation&amortisation

-64

-66

-69

-73

Operatingprofit/EBIT

-393

456

685

928

Netinterest

25

4

2

4

PBT

-368

460

687

931

HSBCQianhaiPBT

-368

460

687

931

Taxation

-116

-5

-7

-9

Netprofit

-250

446

666

904

HSBCQianhainetprofit

-250

446

666

904

Cashflowsummary(CNYm)

Cashflowfromoperations

554

181

481

720

Capex

-346

-106

-108

-109

Cashflowfrominvestment

-713

-120

-122

-124

Dividends

-270

-223

-333

-452

Changeinnetdebt

217

156

-32

-153

FCFequity

208

75

373

611

Balancesheetsummary(CNYm)

Intangiblefixedassets

2,289

2,285

2,284

2,284

Tangiblefixedassets

1,025

1,069

1,109

1,146

Currentassets

5,788

5,799

6,204

6,720

Cash&others

1,961

1,823

1,873

2,046

Totalassets

9,793

9,858

10,316

10,883

Operatingliabilities

2,403

2,218

2,310

2,387

Grossdebt

836

854

873

893

Netdebt

-1,124

-968

-1,000

-1,153

Shareholders'funds

6,818

7,041

7,375

7,827

Investedcapital

4,738

5,113

5,414

5,718

Ratio,growthand

pershare

analysis

Yearto

12/2024a

12/2025e

12/2026e

12/2027e

Y-o-y%change

Revenue

-5.2

5.510.5

9.5

EBITDA

-141.5

44.5

32.7

Operatingprofit

-183.1

50.1

35.5

PBT

-173.5

49.4

35.6

HSBCQianhaiEPS

-141.1

49.4

35.6

Ratios(%)

Revenue/IC(x)

0.9

1.0

1.0

1.0

ROIC

-7.6

9.5

13.1

16.7

ROE

-3.5

6.4

9.2

11.9

ROA

-4.9

4.6

6.7

8.7

EBITDAmargin

-5.6

11.0

14.4

17.5

Operatingprofitmargin

-8.8

9.6

13.1

16.2

EBITDA/netinterest(x)Netdebt/equity

10.2

-17.2

-14.3

-14.0

-15.2

Netdebt/EBITDA(x)4.5-1.9-1.3-1.2

CFfromoperations/netdebt

Persharedata(CNY)

EPSRep(diluted)

-0.23

0.41

0.61

0.83

HSBCQianhaiEPS(diluted)

-0.23

0.41

0.61

0.83

DPS

0.25

0.21

0.31

0.42

Bookvalue

6.28

6.49

6.79

7.20

Valuationdata

Yearto

12/2024a

12/2025e

12/2026e

12/2027e

EV/sales

3.3

3.1

2.8

2.5

EV/EBITDA

nm

28.2

19.5

14.5

EV/IC

3.1

2.9

2.7

2.5

PE*

nm

37.0

24.8

18.3

PB

2.4

2.3

2.2

2.1

FCFyield(%)

1.3

0.5

2.3

3.7

Dividendyield(%)

1.6

1.4

2.0

2.7

*BasedonHSBCQianhaiEPS(diluted)

ESGmetrics

EnvironmentalIndicators

12/2024a

GovernanceIndicators

12/2024a

GHGemissionintensity*3.7

Energyintensity*12.4

CO2reductionpolicyYes

SocialIndicators12/2024a

No.ofboardmembers

8

Averageboardtenure(years)[n/a]

Femaleboardmembers(%)25

Boardmembersindependence(%)37.5

Employeecostsas%ofrevenuesEmployeeturnover(%)

Diversitypolicy

36.3

18.6

Yes

Source:Companydata,HSBCQianhaiSecurities

*GHGintensityandenergyintensityaremeasuredinkgandkWhrespectivelyagainstrevenueinUSD‘000s

Issuerinformation

Shareprice(CNY)

15.21

Freefloat

97%

Targetprice(CNY)

19.00

Sector

Software

RIC(Equity)

300682.SZ

Country/Region

China

Bloomberg(Equity)

300682CH

Analyst

YiranLiu

Marketcap(USDm)

2,331

Contact

+861057952349

Pricerelative

29.60

24.60

19.60

14.60

9.60

4.60

29.60

24.60

19.60

14.60

9.60

4.60

202320242025

LongshineReltoCSI300Index

Source:HSBCQianhaiSecurities

Note:Pricedatcloseof22Dec2025

6

HSBC

Qianhai

https://www

Equities●Software24December2025

BOCHU(688188CH,Buy,TPRMB153.00)

Earningsestimatechanges

Wemarginallyraiseour2025,2026and2027revenueestimatesby1%,2%and2%,respectively,asweexpectfurtherimprovementinthebundlesalesratiooflasercuttingheads.

Welowerour2025,2026and2027grossmarginestimatesby3ppt,4pptand4ppt,respectively,tofactorin:1)somepricingdiscountinbundledlaserheadsgivenintensecompetitionin

downstreamlasercuttingequipmentOEMs;and2)higherrevenuecontributionfromthesmartweldingcontrolsystemandprecisionprocessingbusinesses,bothwithmorehardwareand

relativelylowergrossmarginscomparedwiththelasercuttingcontrolsystembusiness.

Inaddition,weraiseour2025,2026and2027coreexpenseratioestimatesby1ppt,3pptand3ppt,respectively,asweexpecthigherpersonnelgrowthandmoreinvestmentonthenew

weldingcontrolbusinessandoverseaschannelbuildout.

Accordingly,welowerour2025,2026and2027netprofitestimatesby4%,5%and5%,

respectively.Despiteourlower2025-27earningsestimates,weremainoptimisticaboutthe

company’searningsgrowthoutlookwithrobustoverseasgrowthandsmoothprogressinsmartweldingandprecisionprocessing.WeexpectBOCHUtoachievea2025-27netprofitCAGRof22%(previouslya24%netprofitCAGRover2024-27).

Exhibit8.BOCHU:Revenueandearningsestimatechanges

(RMBm)

2

025e

2026e

2

027e

Old

Old

Old

New

Change

New

Change

New

Change

Revenue

2,120

2,141

1%

2,582

2,626

2%

3,161

3,223

2%

Costs

433

501

16%

536

640

19%

664

814

23%

Grossprofit

1,686

1,640

-3%

2,046

1,985

-3%

2,497

2,409

-4%

Sellingexpenses

114

125

9%

129

142

10%

143

158

11%

Administrativeexpenses

138

150

8%

155

168

8%

171

185

8%

R&Dexpenses

335

321

-4%

400

394

-2%

490

483

-1%

Financingexpenses

-26

-26

0%

-30

-30

-1%

-34

-33

-3%

Taxandextracharges

23

28

19%

26

32

22%

32

39

22%

Assetimpairmentloss

2

2

1%

2

2

2%

3

3

2%

Otheroperatingincome

172

176

2%

195

201

3%

222

230

4%

Operatingprofit

1,271

1,216

-4%

1,558

1,479

-5%

1,914

1,804

-6%

Non-operatingincome

0

0

0%

0

0

0%

0

0

0%

Non-operatingexpenses

1

1

0%

1

1

0%

1

1

0%

Profitbeforetax

1,271

1,215

-4%

1,558

1,478

-5%

1,914

1,803

-6%

Incometax

102

122

20%

125

148

19%

153

180

18%

Profitaftertax

1,169

1,094

-6%

1,433

1,331

-7%

1,761

1,623

-8%

MinorityInterest

58

27

-53%

72

33

-54%

88

41

-54%

Netprofit

1,111

1,067

-4%

1,361

1,297

-5%

1,673

1,582

-5%

Source:Companydata,HSBCQianhaiSecuritiesestimates

HSBCQianhaiestimatesvsWindconsensus

Our2025-27revenueandnetprofitestimatesarebelowWindconsensusexpectations,aswearemoreconservativeonthedomesticdemandformid-tolow-powerflatlasercuttingcontrolsystems.

However,asBOCHU’ssharepricehascorrected4%YTD(vstheCSI300up17%overthesameperiod),webelievetheabove-mentionedheadwindshavealreadybeenpricedin.

Moreover,weareoptimisticonBOCHU’slong-termearningsgrowthpotentialfromthesmartweldingcontrolsystemandprecisionprocessingcontrolsystembusinesses.

7

4

HSBCQianha

https://www

Equities●Software24December2025

Exhibit9.HSBCQianhaiSecuritiesestimatesvsWindconsensus

(RMBm)

HSBC

Qianhaiest

imates

W

indconsens

us

Di

fference

___2025e

2026e

2027e

2025e

2026e

2027e

2025e

__________

2026e

2027e

Revenue

2,141

2,626

3,223

2,170

2,711

3,376

-1%

-3%

-5%

Netprofit

1,067

1,297

1,582

1,114

1,388

1,723

-4%

-7%

-8%

Source:Wind,HSBCQianhaiSecuritiesestimates

Earningssensitivityanalysis

WeanalysethesensitivityofnetprofittochangesintheR&Dexpenseratio.Asillustratedbelow,every1pptchangeintheR&Dexpense-to-salesratioleadstoac2%changeinnetprofitinthe

oppositedirection.

Exhibit10.SensitivityanalysisofnetprofittochangesintheR&Dexpenses-to-salesratio

ChangesinR&Dexpenses-to-salesratio

_______________________________________________

Changesinnetprofit

2025e2026e2027e

-1.0ppt

1.8%

1.8%

1.8%

0.0ppt

0.0%

0.0%

0.0%

+1.0ppt

-1.8%

-1.8%

-1.8%

Source:HSBCQianhaiSecuritiesestimates

MaintainourBuyrating;lowerPE-basedtargetpricetoRMB153.00(fromRMB160.71)WecontinuetousethePEapproachtovalueBOCHUandreferenceitshistoricalvaluation.

BOCHU’sadjustedhistoricalaverageone-yearforwardPEsinceitslistingstandsat42x

(excludingPEslargerthan1SDaboveitsoriginalhistoricalaverage)withanetprofitCAGRof28%over2019-25(previouslywerefertoa2019-24netprofitCAGRof29%).

AsweexpectnetprofittogrowataCAGRof22%over2025-27(previouslywerefertoa2024-27netprofitCAGRof24%),weapplya2026targetPEof34x(22/28*42x,unchanged)tovaluethestock.

Basedonour2026EPSestimateofRMB4.49(previouslyRMB4.73,automaticallyadjusted

fromRMB6.63on9June2025duetotheissueofbonusshares),wearriveatournewtarget

priceofRMB153.00(fromRMB160.71,automaticallyadjustedfromRMB225.00on9June2025duetotheissueofbonusshares).Ourtargetpriceimplies16%upsidefromcurrentlevels.WemaintainourBuyratingonthestock,asweexpectsolidearningsgrowthtosupportavaluationre-rating.

Exhibit11.BOCHU:One-yearforwardPEband

110

100

90

80

70

60

50

40

30

20

10

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

-10%

-20%

Aug-19Aug-20Aug-21Aug-22Aug-23Aug-24Aug-25Aug-26

Earningsgrowth(RHS)PEMean+1SD-1SDSource:Wind,companydata,HSBCQianhaiSecuritiesestimates

8

4

HSBCQianha

https://www

Equities●Software24December2025

Exhibit12.BOCHU:Comparablecompanies

Marketcap

ADTV

Current

TPprice_EPSgrowth

Revenuegrowth___PE(x)_____PS(x)__

PEG____ROE____

Ticker

Company

Rating

USDbn

USDm

RMBRMB2025e2026e

2025e2026e2025e2026e2025e2026e

2026e2025e2026e

688188CH

BOCHU*

Buy

5.3

40

153.00

131.39

20%

22%

23%

23%

36

29

17.7

14.4

1.3

18%

20%

600845CH

Baosight*

Buy

6.9

61

23.00

20.38

-19%

16%

-16%

8%

32

27

5.1

4.8

1.7

16%

18%

688083CH

ZWSOFT*

Hold

1.6

36

68.00

66.14

-1%

67%

6%

10%

176

106

11.9

10.8

2.0

2%

4%

688777CH

Supcon*

Hold

5.4

118

58.00

48.14

-19%

15%

3%

9%

42

36

4.0

3.7

2.5

9%

10%

300124CH

Inovance*

Buy

27.7

446

96.00

72.72

32%

20%

15%

16%

35

29

4.6

4.0

1.7

19%

19%

Average(China)9.41403%28%