Soochow: ZCode completes rectification and goes open source; expected to have limited impact on fundamentals; maintain Buy rating on Z.AI (02513)

Soochow released a research report maintaining a "Buy" rating on Z.AI (02513). The bank noted that the company has completed rectification regarding ZCode product security issues and has open-sourced ZCode, and expects the incident to have limited impact on fundamentals. The company disclosed that it has completed rectification regarding ZCode product security issues raised by the community and has open-sourced ZCode, handing it over to community oversight; the company will establish a normalized product security vulnerability response mechanism; regarding the code data mentioned in the community, the company promises that it was not retained and was never used for model training; after completing rectification, the company has passed a third-party security audit. Soochow's main points are as follows: 1) The market is concerned about whether this incident will affect model training The company's disclosure this time emphasizes that the relevant cloud data was never used for model training, so it can be determined that there is no impact on subsequent model training. Because ZCode has undergone deep joint debugging and specialized optimization around the company's self-developed models, the models, tools, and execution workflows are more tightly integrated. Therefore, after open-sourcing, the company is capable of achieving optimal configuration of the model and Harness while maintaining openness. 2) Harness is the new moat, and different Harnesses have a significant impact on model delivery results Previous OpenCode evaluations showed that ZCode's cache hit rate reached 98.6%, ranking first among all Harnesses participating in the evaluation; recent third-party evaluations show that ZCode + GLM-5.3/5.3 Flash has a competitive evaluation pass rate and lower cost. 3) The bank expects this incident to have limited impact on ZCode ZCode maintained rapid growth in its early stage, reflecting high market recognition: one month after launch (mid-August), its user count exceeded 1 million, and by mid-September the user count had doubled again. It is currently a top-three coding agent in China.