Haitong Securities published a research report saying that as a leading marketing and sales SaaS company, Maifushi (02556) has a full-link product system and a strong sales and service network. It targets both small and medium-sized enterprise customers (SMB) and large customer (KA) groups, and two-wheel drive opens up long-term market space. Haitong Securities expects the enterprise SaaS business to grow at an accelerated pace as the company's product system continues to be optimized, AI application maturity continues to improve, and major customers continue to expand. Referring to comparable companies, the reasonable market value range is RMB 25.64-27.148 billion, and the corresponding reasonable value range is RMB 109.03-115.44 (HK$118.51-125.48, converted to HK$1 = RMB 0.92) /share. It was covered for the first time and gave a “superior to the market” rating.
Haitong Securities views are as follows:
A leading SaaS vendor in marketing and sales. Established in 2009, Marketingforce is the largest marketing and sales SaaS company in China and the world's leading intelligent marketing cloud platform. The company ① provides marketing and sales software solutions to Chinese enterprise customers through software as a service (SaaS), and ② provides accurate marketing services to help advertisers advertise on leading media platforms and effectively reach target audiences. In 2021-2023, the company's SaaS business revenue accounted for 50.0%/46.4%/57.0%, respectively, and precision marketing services accounted for 50.0%/53.6%/43.0%, respectively.
One-stop, full-link, full-scenario SaaS products to help digitalize marketing and sales. The company has built a multi-tiered Marketingforce platform, which closely integrates technical infrastructure, data center and SaaS products with each other. By the end of 2023, the functional module platform included 237 functional modules, covering six key stages of the entire marketing and sales process, including content and experience, advertising and promotion, social and relationship, sales and pleasure, data and analysis, and strategy and management. The MarketingForce platform enables SaaS product development, iteration, and customization. Ready-to-use functional modules can reduce the time and resources required for development, and new modules can be easily added to users' subscriptions without disrupting existing products. According to the common needs of specific customer groups, the company designed and launched two iconic SaaS products, namely the marketing of the SaaS product T-Cloud and the sale of SaaS products, which include pre-configured functional modules selected from a matrix of functional modules to form an appropriate marketing method. Additionally, users can flexibly customize their subscription versions by customizing combinations or adding other functional modules.
The SaaS business continues to grow rapidly, and Zhenke Professional Edition helps increase customer unit prices. The company's SaaS business grew rapidly from 0.15 billion yuan in revenue in 2019 to 0.702 billion yuan in 2023, with a compound growth rate of 47.13%, mainly due to ① the company continues to launch new functional modules and improve the effectiveness of existing functional modules to better meet the changing needs of customers; ② the sales network is growing rapidly; ③ the company provides high-quality services to help customers succeed. The number of users in the company's SaaS business increased to 25,495 in 2023, and the average contract value per user increased to RMB 51238, of which the number of customers contributing more than 0.2 million yuan increased from 376 in 2022 to 501 in 2023. High-value customers with relatively large operating scales mainly purchased the Professional Edition of Zhenke and required more user accounts and/or large-scale data usage for marketing content distribution, leading to higher consumption under the Professional Edition pricing model.
The quality and efficiency of operations improved, and net losses continued to narrow. The company's adjusted net loss for 2021-2023 (non-IFRS measurement) was 0.131/0.132/0.028 billion yuan, respectively. The loss reduction in 2023 was clearly mainly due to an increase in gross profit due to an increase in revenue contribution to the SaaS business, and a decrease in R&D expenses due to improved efficiency and cost efficiency of R&D work. According to the company's prospectus, citing Frost & Sullivan, SaaS solution providers often lose money when expanding their business due to the time gap between revenue recognition and operating expenses. The company plans to continue to expand its customer base and optimize product capabilities to retain more users by implementing marketing strategies, promote continuous revenue growth to achieve profits, and control costs and expenses by improving operational efficiency.
The combined growth rate of the marketing and sales SaaS market is nearly 30%, and the prospects are broad. Compared with other solutions that mainly focus on improving the efficiency of back-end operations, such as human resources management and supply chain management, enterprises are more willing to pay for marketing and sales SaaS solutions, which can improve lead acquisition and promote revenue growth, with the most remarkable results. According to Frost & Sullivan's prospectus, the marketing and sales SaaS solutions market grew from RMB 7.3 billion in 2018 to RMB 20.6 billion in 2022, with a compound annual growth rate of 29.7%; the market size of marketing and sales of SaaS solutions is expected to reach 74.5 billion yuan in 2027, with a compound annual growth rate of 29.3% from 2022 to 2027.
Empowered by AI, start automating marketing and sales growth. The company deployed AI-related products earlier. For example, Zhenwen, Zhentu, and Zhenshi's three artificial intelligence content generation modules were the predecessor of AIGC. The intelligent cloud in the company's current six-cloud system combines analytical AI and generative AI technology. The intelligent cloud capability deployment includes large industry models (Tforce big model), marketing automation, intelligent question count and data analysis, model application components, knowledge base and AI robots, and generative AI applications. Intelligent clouds not only use AI technology to provide enterprises with in-depth data analysis and prediction models, but also automatically generate efficient marketing content and strategies to help enterprises achieve accurate marketing and customer relationship management, optimize customer interaction experiences, and enhance conversion rates and market competitiveness. Based on the Tforce model, MarketingForce is deeply integrating AI technology into the core services of various modules such as marketing and sales to create a next-generation marketing platform.