In the third quarter of 2023, Geling Shentong's revenue fell by 14% year-on-year48% to 06.7 billion yuan, and the net profit attributable to the parent company was -0RMB1.9 billion was mainly due to a decrease in revenue and an increase in R&D investment.
Investment Times researcher Wang Zixi.
A few days ago, the news of "Hebei rich man found his son who had been separated for 25 years" was swiped on the Internet, and Beijing Geling Shentong Information Technology Co., Ltd., which provided technical support for the search for relatives, is referred to as Geling Shentong, 688207SH) has also received attention from the outside world.
As the "first AI vision stock on the Science and Technology Innovation Board", Geling Shentong was listed in March 2022. In the year of listing, the company achieved profitability, and the net profit attributable to shareholders of the parent company (hereinafter referred to as the net profit attributable to the parent company) achieved 03.3 billion yuan. But soon, the company fell into the red again. According to the financial report data, in the third quarter of 2023, Geling Shentong's revenue fell by 14% year-on-year48% to 06.7 billion yuan, and the net profit attributable to the parent company was -0RMB1.9 billion was mainly due to a decrease in revenue and an increase in R&D investment. In the quarter, the company's R&D investment accounted for 70% of revenue73%。
It should also be noted that the main business income of Geling Shentong comes from four major areas such as smart finance and urban management, but in the field of smart finance, the customer concentration is high, and if it cannot continue to obtain orders from large customers or effectively develop new customers, the company's revenue may fluctuate to a certain extent. And the data shows that as of the end of 2022, the book value of the company's accounts receivable accounted for 51 percent of revenue57%, the change in this indicator also indicates the quality of the company's revenue growth to a certain extent.
In the secondary market, as of December 13, 2023, the company's share price closed at 225 yuan shares (no reinstatement, the same below), the total market value is less than 6 billion yuan, which is about 900 million yuan lower than the market value on the day of listing.
In response to the situation of the "cross-age same-related face comparison algorithm", the difficulty of making profits of artificial intelligence enterprises, and the risk management and control of large customer collection, the researchers of "Investment Times" emailed the communication outline to the relevant departments of the company, but have not received a reply as of press time.
The stock price trend of Geling Shentong since its listing(Yuan).
Data**: wind
The "AI family search" message swiped the screen
On December 3, Geling Shentong posted on the official Weibo, saying, "The rich man of Hebei found his son who had been separated for 25 years with the help of **. Behind the reunion of relatives is the power of science and technology in play, and the 'cross-age and related face comparison algorithm' independently developed by Geling Shentong has made great contributions."
Or affected by this, the next day, Geling Shentong's intraday stock price rose by more than 17%.
On December 4, the company issued another statement saying, "The company mainly cooperates with ** to provide tools such as technology and algorithms, and then hands them over to ** to apply";"The company has not developed the so-called 'paid version of the family tracing app', nor has it authorized any unit or individual to sell related software. ”
In fact, this is not the first child that Geling Shentong has used face recognition and face comparison algorithms to assist relevant departments in retrieving it. Prior to this, successful cases of the application of this technology also included "Chuan Chuan", who had been abducted for 22 years, and Ms. Wu's son, who had been missing for 25 years.
Researchers from the Investment Times noted that face recognition is one of the earliest and most mature technologies in the field of AI. In addition, there are a large number of listed companies in China's face recognition industry, which are distributed in various industrial chains. Among them, the midstream of the industrial chain is mainly face recognition algorithms and software services, and listed companies include SenseTime-W (0020.).HK), Hikvision (002415SZ), Hanwang Technology (002362SZ), Cloudwalk Technology—UW (688327.)sh) and so on. At present, face recognition products are mainly used in security, finance, commerce and other fields.
In the investor research activities, Geling Shentong said that the company ranked among the best in the face recognition algorithm test held by international authoritative institutions and organizations, and its technical capabilities have been verified, but because the company's strategy is to select high-quality businesses with high gross profit margins and good returns, the current business volume in the security field is not particularly large. Now, the company's brand influence has been further enhanced, which may boost the sales of the company's other security-related products. At the same time, the company will also pay attention to whether the technology has the possibility of developing C-end products.
Stuck in the quagmire of losses again
Founded in 2013, Geling Shentong focuses on integrating advanced computer vision technology, big data analysis technology, robotics and human-computer interaction technology with application scenarios to provide artificial intelligence products and solutions for smart finance, urban management, commercial retail, rail transit operation and maintenance, sports and health and other fields.
The Company's self-developed artificial intelligence products mainly include Zhiyuan intelligent front-end products, Lingxi data intelligence platform and deep pupil industry application platform. AI products can be sold in a standardized model, or combined according to customer needs, and delivered to customers in the form of total solutions.
On March 17, 2022, Geling Shentong landed on the Science and Technology Innovation Board of the Shanghai Stock Exchange, becoming the "first AI vision stock on the Science and Technology Innovation Board". On the day of listing, the company's stock price closed at 3746 yuan shares, with a total market value of about 6.9 billion yuan.
In the year of listing, Geling Shentong achieved revenue of 35.4 billion yuan, a year-on-year increase of 2047%；The net profit attributable to the parent company was 03.3 billion yuan, an increase of more than 100 million yuan over the same period last year. Researchers from the Investment Times noted that the company's net profit attributable to the parent company turned positive for the first time, in addition to the growth of revenue, but also by the growth of software revenue brought about by the growth of value-added tax, the decrease in share-based payment expenses, the significant increase in interest income and other factors.
But the good times did not last long, and after making a profit in the year of listing, the company soon fell into a loss again. According to the data of the third quarterly report, in the first three quarters of 2023, Geling Shentong achieved revenue of 22.5 billion yuan, a year-on-year increase of 1476%；The net profit attributable to the parent company was 01.7 billion yuan, and the net profit loss attributable to the parent company after deducting non-profit was about 02.2 billion yuan, both increased over the same period last year.
In the third quarter, the company's revenue fell by 14 year-on-year48% to 06.7 billion yuan, the net loss attributable to the parent increased to 0 year-on-year$1.9 billion. The company explained in its financial report that the negative profit was mainly due to the year-on-year decrease in revenue and the increase in R&D investment.
According to the data, as of the end of June 2023, the number of R&D personnel of Geling Shentong is 321, accounting for 65% of the company's total number, an increase of 45 people from the end of 2022. In the first three quarters of 2023, the company's R&D investment was 12.5 billion yuan, a year-on-year increase of nearly 40%, accounting for 55% of the company's revenue46%；Among them, R&D expenses in the third quarter were 04.7 billion yuan, an increase of 44 over the same period last year46%, accounting for 70 percent of operating income73%。
CITIC believes that although the company's short-term performance is less than expected, the company's continuous investment in R&D and the gradual clarification of commercialization scenarios in the future will help the company achieve greater value in the application link with its low-cost and high-efficiency model development capabilities.
R&D investment and revenue since 2018(100 million yuan).
Data**: wind
Smart finance relies on large customers
From the perspective of business composition, Geling Shentong's main business income comes from smart finance, urban management, commercial retail, rail transit operation and maintenance, and it also carries out business layout in the fields of sports and health, metaverse and other fields. However, in the field of smart finance, the company's customer concentration is high, and it is necessary to pay attention to the risk of revenue fluctuation and payment collection caused by relying on large customers.
According to the company's prospectus, from 2018 to 2020, the company's end customer in the field of smart finance was only Agricultural Bank of China, and from 2021, the company began to cooperate with China Construction Bank.
From 2018 to 2020, the company's revenue from Agricultural Bank was 468680,000 yuan, 2373970,000 yuan, 4697090,000 yuan, accounting for the proportion of the main business income in each period. 36%。As of the end of 2019 and the end of 2020, the book balance of accounts receivable attributable to ABC was 2,302660,000 yuan, 2357030,000 yuan, accounting for more than 32% of the company's accounts receivable balance.
It should be noted that as of the end of 2022 and the end of September 2023, the book value of accounts receivable of Geling Shentong was 18.2 billion yuan, 20.9 billion yuan, accounting for revenue. 95%。Considering the seasonal characteristics of the company's revenue, the proportion of revenue in the fourth quarter to the annual revenue is relatively high, and whether the proportion of accounts receivable in revenue can be lower at that time may indicate the quality of the company's revenue growth.
In addition, since the beginning of this year, shareholders including "Zhen** Sequoia Capital, Hyundai Motor, etc. have been deeply preached. Among them, Sequoia Capital **443950,000 shares, involving an amount of about 13.4 billion yuan;"True Grid** 296720,000 shares, involving an amount of about 08.4 billion yuan;Hyundai Motor and Hyundai Mobis combined**470530,000 shares, involving an amount of more than 100 million yuan. Although its investment in Geling Shentong is relatively early and there is a need to withdraw funds, concentration** may also have an impact on investment sentiment.