CICC: Maintains outperform rating on SHOUCHENG (00697), target price of HK$2.7.

CICC releases research report, stating that considering the investment excess returns and service franchise income of SHOUCHENG (00697), an estimated revenue of 640 million Hong Kong dollars in 2027 is introduced (+97% and +6% respectively). It maintains an outperform industry rating with a target price of 2.7 Hong Kong dollars, corresponding to 2.2 times the 2026 price-to-book ratio, implying a 62% upside potential from the current stock price. The company is currently trading at 1.3 times the 2026 price-to-book ratio. Key points from CICC: SHOUCHENG announces 2025 performance Revenue and gross profit increased by 18% and 11% respectively to 1.437 and 0.565 billion Hong Kong dollars year-on-year, with a net profit of 310 million Hong Kong dollars, corresponding to a basic earnings per share of 0.409 Hong Kong dollars. The company declared a final dividend of 0.39 billion Hong Kong dollars (interim dividend of 2.71 billion Hong Kong dollars), plus a special dividend of 0.47 billion Hong Kong dollars. The annual dividends correspond to a dividend yield of about 5.6% at the current closing price. In 2025, the company's overall revenue increased by 18% year-on-year to 1.437 billion Hong Kong dollars, mainly driven by revenue from parking operation services and investment income. Dual drivers of "industry fund + asset management" On the fund side, the company disclosed that it will launch two funds focusing on strategic emerging industries and asset restructuring (special opportunities). On the asset side, the company continues to improve the "experience-sales-service" closed loop of Siasun Robot&Automation products; at the same time, it promotes technology-enabled infrastructure operations, achieving dual improvement in asset efficiency and value. Focus on the progress of Siasun Robot&Automation related companies' IPO The company's industry fund has deeply deployed in the Siasun Robot&Automation track, with the investment portfolio covering top companies such as Yushu Technology, Songyan Power, and Galaxy General. According to the annual report, as of the end of 2025, the valuation of the Beijing Siasun Robot&Automation Industry Development Investment Fund managed by the company has increased by about 4 times. CICC suggests to continue to pay attention to the progress of the IPO of invested companies, which they believe may have a positive catalytic effect on performance and stock price. Risk warning: Progress of Siasun Robot&Automation related companies' IPO is slower than expected; dividend amount is less than expected.