Bairong’s share price have performed well recently, with the VoxOne launch and expansion into non-credit use cases marking further progress in its transformation. The shares closed at HKD5.91 on 3 November, up approximately 20% from 30 September. The company has introduced the Bairong Voice brand and VoxOne, its unified voice intelligence foundation, spanning enterprise-grade AI customer service, intelligent marketing and an open voice interaction platform to extend its AI Contact Center (AICC) business into more industries. A flagship logistics deployment is expanding its service scope, while deployments for airline and securities brokerage clients are also progressing. In our view, the key developments are voice AI’s growing ability to handle more complete customer service workflows and the extension of outcome-based pricing into non-credit use cases. Near term, contraction in legacy businesses continues to weigh on overall results. We expect cost controls to take greater effect in 2H26, potentially narrowing losses versus 1H26. Medium-term growth will depend on customer go-lives and service volume ramp-ups in new use cases. BUY.
Near-term pressure persists; cost controls could narrow losses
Contraction in legacy businesses may continue to weigh on near-term financial performance, but we expect cost controls to help narrow losses in 2H26. In 1H26, revenue fell 43% YoY to RMB914mn, gross margin declined 20pp YoY to 53%, and the company recorded a net loss of RMB322mn. External risk events pose challenges for the online lending industry in 2H26, potentially keeping overall revenue under pressure. However, the company has undertaken workforce and related cost optimization measures this year, the benefits of which were not fully reflected in 1H26. We expect 2H26 losses to narrow versus 1H26, with 2027 results potentially benefiting further from lower costs and stabilization in legacy businesses. For new use cases, we expect 2H26 growth to remain close to the rapid pace recorded in 1H26.
Earnings forecast and valuation
With the company’s business transformation progressing steadily, we maintain our 2026/2027/2028 attributable NP forecasts of -RMB590mn/-120mn/170mn. We maintain our DCF-based target price of HKD7.8 (cost of equity: 8%).
Risks: regulatory volatility; intensifying industry competition; failure in core client revenue expansion and expense control