CLSA has released a research report reaffirming its "Outperform" rating on Kingdee International (00268) with a target price of HK$12.6.

The company's subscription services annual recurring revenue (ARR) grew 19.3% year-on-year to RMB 4.604 billion for the third quarter ended September, while net new ARR jumped 46.9% year-on-year in the third quarter, driven by strong demand for Kingdee's AI suite and Lingee.

CLSA noted that the contract value of Kingdee's AI-native products reached RMB 1.002 billion in the first three quarters of 2026, implying approximately RMB 397 million in new additions during the third quarter, up from RMB 375 million in the second quarter and RMB 230 million in the first quarter. This reflects that the company's AI-native products are bringing incremental recurring revenue while its existing core subscription services business continues to grow healthily.

In the third quarter, Kingdee signed contracts with enterprises including CRRC Corporation (01766), China Everbright Group, and H World Group-S (01179), with clients spanning state-owned enterprises, financial services, consumer services, and new energy sectors.