WEAVER NETWORK(603039)：LAUNCH OF SEVEN SPECIAL APPLICATIONS;A NEW CHAPTER FOR THE OA SOLUTION BUSINESS

　　What's new
　　We attended the annual meeting of Weaver Network on January 22. At the meeting, management introduced the company’s new products and new strategies for 2022. First, Weaver’s digital collaboration platform provides corporate clients with solutions such as trusted digital identities, digital approval process, document management, e-signatures, and internal and external business collaboration. Second, Weaver unveiled seven special office automation (OA) applications, including human resource (HR), contract, purchase, expense, archive, and document management systems, as well as information collection product.
　　Comments
The launch of seven special applications proves our estimate that Weaver will enrich its OA product portfolio. Weaver’s OA solution　enhances workflow management and realizes data interaction with HR management and customer relationship management systems. As a key information technology enabling company management, the company’s OA product portfolio will continue to be enriched, in our view. Weaver’s seven special applications integrate reusable modules to meet different user cases. Our estimate that the company’s OA product portfolio will expand has been proved. We think the company is stepping up efforts in new product incubation.
　　Differentiated competitiveness of the seven special applications lies in the closer tie with business systems. As interfaces of a company’s　digital office system, Weaver’s seven integrated OA modules could boost synergies with the company’s business systems, in our opinion. Based on data interconnection, HR management system could reflect the real performance of workers and the company; document management and contract management systems could collect unstructured data and documents; and expense management system could power automatic accounting, in our view. The seven special applications are convenient and allow immediate system upgrading and optimization. We think the products are efficient and flexible.
　　Digital collaboration platform to help start a new chapter for OA　solutions. Technologically, Weaver’s digital collaboration platform integrates e-signature function, robotic process automation, and low-code development capability to meet diversified business management demand of a company. Weaver is focusing on developing new OA applications for　both workflow management and business management. Its new product (which can be used independently) is also under incubation. Weaver is transforming from a single solution supplier to a comprehensive digital solution provider, as it seeks to maintain long-term relationships with its OA business customers. In addition, we believe the joint development of its EBU team, agents, business partners, and companies incorporated into Weaver eteams’ Kunpen partnership plan will enrich its product portfolio.
　　Valuation and recommendation
　　We maintain our 2021 and 2022 earnings forecasts and introduce our 2023 earnings forecast. We expect Weaver’s attributable net profit to rise 23.8%, 30% and 29.9% YoY to Rmb284mn, Rmb369mn, and Rmb480mn over 2021-2023. The stock is trading at 32x 2022e price to operating cash flow ratio (P/OCF). We maintain an OUTPERFORM rating and our target price of Rmb97.2, implying 44x 2022 P/OCF with 39.9% upside.
　　Risks
　　Lower-than-expected acceptance of electronic signatures; lower-than- expected use of OA products in government departments.
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   【免责声明】本文仅代表第三方观点，不代表和讯网立场。投资者据此操作，风险请自担。