【True Insight Hong Kong Stock Masters】VSTECS (00856.HK) benefits from the rapid development in the fields of AI and computing power scheduling

Vice Chairman of the Hong Kong Society of Financial Analysts, Mr. Pan Tieshan, pointed out that $VSTECS(00856.HK) VSTECS (00856.HK) has demonstrated multiple growth highlights in its 2024 financial performance. Firstly, the group's revenue in the first half of the year reached RMB 40 billion, a year-on-year increase of 17.8%. This significant growth was primarily driven by its rapid development in the AI and computing power scheduling sectors. The contract order value for AI management products has reached 30%, and collaborations with companies such as Huawei, AI servers, NVIDIA, PowerLeader, and SenseTime have all achieved rapid double-digit growth, providing new momentum for the group's expansion.

Additionally, VSTECS has performed exceptionally well in overseas markets, particularly in Southeast Asia, where revenue reached RMB 13.66 billion, a year-on-year increase of 60.9%. This growth was attributed to the group's deepened collaborations with international brands in the region and the receipt of multiple awards from manufacturers, such as the "2023 Best Growth Master Distributor Award" from HPE Singapore. These accolades underscore the company's strong competitiveness and brand influence in overseas markets.

The development of domestic innovation businesses is another major growth highlight for VSTECS. The group has begun to focus on innovation-driven businesses, with domestic brands accounting for over 60% of sales in China. The rapid growth in this sector has created new opportunities for the company. VSTECS has also recognized the future importance of cybersecurity and has actively supported Chinese cybersecurity companies, such as Kingsoft, in bringing their products to market, achieving notable results. This further highlights the prominent position of innovation-driven businesses in the industry.

Overall, VSTECS's 2024 financial performance showcases rapid development in AI and computing power scheduling, outstanding performance in overseas markets, and robust growth in domestic innovation-driven businesses. These factors collectively demonstrate the group's leadership in technology product channel development and integrated technical solution services. Vice Chairman Pan Tieshan of the Hong Kong Society of Financial Analysts suggests considering buying at HK$4.80, with a target price of HK$5.20 and a stop-loss at HK$4.50.

Vice Chairman of the Hong Kong Society of Financial Analysts, Pan Tieshan

(The author does not hold the relevant shares, but the author's clients hold the relevant shares)