\u3000\u3000 Mango Excellent Media Co.Ltd(300413) (300413)
On February 24, the company will lift the ban on about 90.34 million shares, accounting for 9.70% of the tradable shares before the lifting of the ban and 4.83% of the total share capital; The type of shares lifted this time is the placement of shares by private placement institutions. The number of shares lifted by China mobile capital, China Europe Fund and Xingquan fund are 60.23 million shares, 16.06 million shares and 14.05 million shares respectively. Among them, China mobile capital is the second largest shareholder of the company and has participated in the fixed increase of the company twice. So far, China mobile capital holds 131 million shares of the company, accounting for 7.01% of the total share capital. We believe that from the perspective of CMCC capital, as a strategic investor, the cooperation between China Mobile and mango will continue to deepen. The main purpose of China Mobile's investment in mango is to deeply layout the pan entertainment industry around the upstream and downstream industrial chain. On November 28, 2021, the company announced that the cooperation between mango and China Mobile will further deepen, The cooperation amount in the next three years will not be less than 3.5 billion yuan (including 800 million yuan this year). From the perspective of splitting, it is expected to have a positive impact on the operator business of Mango (the business revenue has increased by more than 30% for three consecutive years). At present, the Migu video of China Mobile is out of the circle due to the live broadcast of the Olympic Games and the interpretation of Wang Meng. It has a significant force in the pan entertainment business, even in the direction of 5g, VR and metauniverse. In addition, the current valuation of the company is low. According to wind, the current PE of the company is about 29x, and the PE of the company from 2020 to 2021 is between 30x-100x.
What do you think of 2022? The period of reshaping the industry structure is also an opportunity period for mango, with large follow-up growth space:
1) by the end of the year 21, the company has reached the target of 50 million members (+ 40%). Based on the content recognition and channel advantages (China Mobile), the growth of members in 2022 is still optimistic;
2) the launch of "big detective 7", the follow-up of "sound never stops" (expected to be broadcast in March), several key variety shows of "brother" and "sister" will be launched quarterly, and the launch of the big play "Shangshi" on February 22 will drive the gradual restoration of performance. The program "big detective 7", which was broadcast on January 28, has remained popular after it was changed to the program of legal education and reasoning. Up to now, the number of broadcasts in 23 days of release is 710 million, and the number of single episodes is about 100 million, ranking the top three in weekly popularity (Guduo data);
3) Xiaomang is expected to enter the development stage. According to the company's announcement, Xiaomang in the strategic cultivation period reached the goal of 1 million Dau in 2021, and the income end assessment of Xiaomang will be increased in the future; In addition, the structure of mango film and television, mango entertainment and mango mutual entertainment has been adjusted;
4) at the industry level, first, in terms of policy, in the second half of 2021, due to the influence of industry content supervision and Qinglang movement, the scheduling of some programs of the company was postponed, and now the content production and scheduling have returned to the normal rhythm; Second, the price of mango has been raised by members; Third, the State Administration of radio, film and television recently issued the "14th five year plan for the development of Chinese TV dramas", which once again emphasizes the whole chain protection of intellectual property rights in the field of TV dramas and the "sky high price film remuneration" of actors, which will reshape the pattern of content supply in the industry; Fourth, we are optimistic about the next round of IP incubation and commercialization in the meta universe era. According to our stock selection logic, mango is at the forefront of subdivided industries, which stems from its own IP and strong ability of its own operation.
Investment suggestion: mango has the attribute of media platform + content self-made gene, has outstanding innovation ability in the field of variety arts, and pays attention to the effect of subsequent key variety shows and dramas on advertising, investment promotion and members. Considering the impact of media Internet industry policies and the adjustment of the company's business structure since 2021, we lowered our profit expectation for the company. We expect the company's net profit from 2021 to 2023 to be RMB 2.04/25.9/2.99 billion respectively, corresponding to EPS of RMB 1.09/1.38/1.60 and PE of 34 / 27 / 23x. We give a valuation of 40x in 2022, corresponding to the target price of RMB 55.2, and maintain the "Buy-A" rating.
Risk tip: the industry policy supervision is becoming stricter, the performance of content broadcasting is lower than expected, the growth rate of platform user scale is lower than expected, and the expansion of new businesses such as e-commerce and offline entertainment is lower than expected.
