Futu News reported on December 29 that$51WORLD (06651.HK)$ The stock closed 23.54% higher in the gray market today, at HKD 37.68 per share. With each lot consisting of 200 shares, excluding handling fees, investors gained HKD 1,436 per lot.
Source of market data: Futu Securities
Investment Highlights
Leading industry position: The company is the absolute leader in China’s digital twin industry, ranking first in 2024 with a market share of 2.4%, far surpassing the second-place competitor's 1.7%. As the only service provider capable of offering one-stop solutions, its business spans over 10 fields including cities, water conservancy, and automobiles, serving more than 1,000 enterprise clients across 19 countries and regions. Core metrics rank among the best in the industry, with revenue and financing amounts topping the list in 2024. It is also the first digital twin enterprise to achieve annual revenue exceeding HKD 250 million. The company has completed numerous benchmark projects, such as the Xiaolangdi Digital Twin project, accumulating extensive experience in smart city applications.
Policy-driven advantages: The company’s operations align closely with national strategic priorities, focusing on areas like digital twins, artificial intelligence, and autonomous driving simulation, which are key focus areas of the 14th Five-Year Plan and the “Artificial Intelligence+” Action Plan. The industry demonstrates strong growth potential, with China’s digital twin solutions market reaching RMB 16 billion in 2024, a year-on-year increase of 31%, and expected to grow to RMB 50 billion by 2029, achieving a compound annual growth rate (CAGR) of 33% over the next four years. As a technology-focused company listed under Chapter 18C of the Hong Kong Stock Exchange, it enjoys exemptions from profit thresholds and other listing conveniences, making it easier to attract investors focused on high-growth tech stocks.
Risk Factors
Customer concentration risks: The company’s customer concentration has been increasing annually, with revenue from the top five customers rising from 23.6% in 2022 to 51.5% in the first half of 2025, meaning over half of its revenue depends on a small number of clients. Stability among core customers is lacking, as major clients vary significantly across periods, indicating an absence of long-term, stable core client relationships. The customer base primarily consists of government agencies and large enterprises, whose payment cycles are affected by budget approval processes. Combined with sales and implementation cycles lasting between 1 and 13 months, this results in slow cash collection and ties up significant working capital.
Intense industry competition: The industry remains highly fragmented, with the top three players collectively holding only 5.7% of the market in 2024. Fierce competition exists among peers such as UINO Technology and Chenxi Surveying. The company faces pressure from tech giants like Alibaba Cloud and Tencent Cloud, whose “Cloud+AI+Twinning” models leverage ecosystem advantages to squeeze market space. Additionally, it must contend with global competitors like NVIDIA’s Earth-2, where gaps remain in high-end technological fields.
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Editor/Jamie