Market Insight | Tianjudihe surged more than 16% at one point on its first day of trading, but fell sharply at the close, breaking below the IPO price. The company's net profit margin has declined significantly

TIANJUDIHE surged more than 16% in early trading, worth noting that the stock skyrocketed over 40% on its listing day, but plunged and broke on the closing bell. As of the time of writing, it is up 12.47% at HKD 67.65, with a turnover of HKD 119.16 million. TIANJUDIHE is known for providing customers with standardized API services and customized data governance solutions. According to a Frost & Sullivan report, in terms of revenue in 2022, the company is China's largest comprehensive API data circulation service provider with a market share of 6.1%. The company's clients include well-known enterprises such as Tencent, Alibaba, as well as many other internet companies, app developers, and individuals. The prospectus shows that from 2021 to 2023, TIANJUDIHE's revenue will be RMB 260 million, RMB 329 million, RMB 441 million respectively; net profits will be RMB 45.966 million, RMB 41.284 million, RMB 35.061 million respectively; gross profit margins will be 34.6%, 32.7%, 28.3% respectively; net profit margins will be 17.7%, 12.6%, 7.9% respectively. It is reported that the company's gross profit margin and net profit margin have declined significantly, mainly due to intensified market competition leading to price reductions and increased outsourcing research and development expenses