Bluefocus Intelligent Communications Group Co.Ltd(300058) (300058)
Recommendation logic: 1) the company is a leading marketing technology enterprise fully empowered with enterprise intelligence management,] ranking No. 8 among global public relations companies in 2021, with outstanding business strength; 2) According to the in-depth industry report of virtual digital human, it is estimated that China’s virtual human market will reach 270 billion yuan in 2030; The company is a pioneer in the virtual human industry, or will enjoy the expansion bonus; 3) Sea going business: in 2021h1, the sea going business revenue increased by 41.6% year-on-year, and the gross profit margin increased by 0.61pp; Brand superposition and rich overseas media resources are expected to accelerate growth.
The virtual human market continues to expand, and industrial policies release positive signals. 1) Market side: according to the in-depth industry report of virtual digital human, it is estimated that the overall market scale of Chinese virtual human will reach 270 billion yuan by 2030; 2) Policy side: since 2017, China has included core technologies such as virtual reality and AI into the scope of encouragement, and proposed to accelerate the development of virtual reality industry. With the iteration of technology upgrading and the decline of production cost, the C-end application of virtual human may be popularized on a large scale, and the industry is expected to enter the fast lane of development.
“Content + marketing + technology” complement each other, and marketing technology enables virtual IP. The company is a marketing technology company that fully enables the intelligent operation of enterprises. It is the first batch of marketing institutions with digital transformation, and has a deep digital foundation. Since 2019, the company has designed, produced and operated virtual images for customers, and its representative works include many well-known virtual people; On the first day of 2022, the company’s independent IP virtual person “Su Xiaomei” was officially launched. Content marketing and technology driven are expected to help the company’s virtual human business advance steadily.
In fields related to the overweight universe, new growth momentum is expected to appear. When the meta universe layout is in progress: 1) officially launch the independent IP virtual human; 2) Work with ALI Dharma academy to build virtual live studio business, build virtual human version 1.0, and enable e-commerce transactions; 3) Establish a wholly-owned subsidiary of blue universe; 4) Explore the integration of online virtual space and offline physical space with danghong Qitian and its subsidiary Qile infinite, as well as the wider marketing application of XR technology; 5) In terms of AI technology, it has reached strategic cooperation with Baidu xirang to jointly promote the combination of meta universe technology and marketing. A number of initiatives may form a significant synergy between the company’s own IP, technology and marketing, and build a new growth pole of performance.
Profit forecast and investment suggestions. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be RMB 660 million, RMB 830 million and RMB 980 million respectively, and the corresponding PE will be 41 times, 32 times and 27 times respectively. As a leading advertising and marketing enterprise, the company has significant advantages in its main business. “Content + marketing + technology” helps virtual human IP business realization and application scenario expansion, or is a new growth point of potential performance. The company’s meta universe layout deserves attention. To sum up, we give the company a valuation of 40 times in 2022, corresponding to the target price of 13.2 yuan. It is covered for the first time and given a “buy” rating.
Risk warning: market competition intensifies risk, advertising industry downside risk, sea business is less than expected risk, and the progress of metauniverse strategy is less than expected risk
