\u3000\u30 Zhongyan Technology Co.Ltd(003001) 82 Beijing Jetsen Technology Co.Ltd(300182) )
Event overview
On the evening of March 16, 2022, Beijing Jetsen Technology Co.Ltd(300182) disclosed the performance express of 2021 and released the performance forecast of the first quarter of 2022. In 2021, the company achieved a revenue of 3.772 billion yuan, a year-on-year increase of 18.49%, and a net profit attributable to the parent company of 461 million yuan, a year-on-year increase of 137.21%; In the first quarter of 2022, the company is expected to realize a net profit attributable to the parent company of 230260 million yuan, with a year-on-year increase of 136.21% – 167.02%.
Landing 1.8 billion yuan Tencent orders, and the performance forecast confirms the logic of “operation inflection point”
According to the company’s announcement, Xinjiang Huaxiu, a subsidiary of China television network gathering, has signed a film and television program authorization contract with Tencent of 1.8 billion yuan, and the revenue recognition amount is expected to be 600 million-1 billion yuan in 2022. Since the outbreak of covid-19 epidemic in 2020, the company has increased the distribution of large film libraries, further improved the liquidity of film libraries, and signed an authorization order of RMB 1.8 billion with Tencent to further verify the liquidity value of the company’s copyright libraries. The signing of Tencent’s orders will bring considerable and stable cash flow support for the company’s continued business expansion and development in the future. Combined with the company’s turnaround from loss to profit in 2021 and the better than expected performance of the first quarter report in 2022, we reaffirm the logical confirmation of the company’s “operation inflection point” (Note: our report “landing Tencent’s order of 1.8 billion yuan and the operation inflection point of copyright leader has reached” issued on February 13), Future growth can be expected!
Shiyou technology was selected as “specialized and special new”, and its performance doubled in 2021q4
According to the notice on the publicity of the list of the second batch of small and medium-sized enterprises to be recognized as “specialized, special and new” in Beijing in 2022 released by the Beijing Municipal Bureau of economy and information technology on March 14, 2022, the company’s participating yuancosmos company Shiyou technology won the title of “specialized, special and new” enterprise in Beijing with its leading real-time digital human technology, virtual studio technology, leading independent research and development ability and operation ability. According to the announcement of the company, Shiyou technology achieved a revenue of 343799 million yuan and a net profit of 8.0435 million yuan in 2021, including 116735 million yuan in the first three quarters and 3.339 million yuan in the net profit. It can be calculated that the Q4 single quarter in 2021 achieved a revenue of 227064 million yuan and a net profit of 4.7045 million yuan, and the Q4 single quarter performance doubled.
The spring breeze of industrial policies continued, and equity incentives and asset divestitures were implemented to ensure steady growth
Since the second half of 2021, policy documents such as the outline of strengthening the country with intellectual property rights, the 14th five year plan for the film industry, the detailed rules for the review of short video content, the 14th five year plan for the development of digital economy and the 14th five year plan for the development of Chinese TV dramas have significantly benefited the long-term development of the company’s film and television copyright operation business. The company invested in Shiyou technology in 2016 to advance the layout of virtual technology. 2022 is the first year of metauniverse. The company has made continuous breakthroughs in the underlying technology of metauniverse and continued to explore the business forms of metauniverse such as virtual copyright operation and virtual idol. In the third quarter of 2021, the company released the equity incentive plan, which targets the company’s senior executives and core business backbones, providing guarantee for the sustainable and healthy development of the company’s main business. In December 2021, the company completed the divestiture of assets, and in 2022, the young people will be put into battle, which is expected to achieve further growth in operating performance.
Investment advice: maintain and emphasize the “buy” rating
On the one hand, the landing of Tencent’s orders will have a positive and direct impact on the performance in 2022 (according to the announcement, the revenue is expected to be recognized in 2022 is 600-1 billion yuan). On the other hand, the delivery of orders will significantly improve the company’s capital situation, improve the capital turnover efficiency of copyright business and further expand the scale of new film distribution business. The performance forecast of the company’s first quarterly report exceeded expectations, so we further raised the company’s future profit forecast: the revenue forecast from 2021 to 2023 was adjusted from RMB 3.604/48.495564 billion to RMB 3.772/48.805623 billion, the net profit attributable to the parent company was adjusted from RMB 472 / 782 / 951 million to RMB 461 / 798 / 968 million, and the corresponding EPS forecast was increased from RMB 0.18/0.30/0.37 to RMB 0.18/0.31/0.38, corresponding to the closing price of RMB 5.48/share on March 16, 2022, PE was 31, 18 and 15 times respectively. At present, the company has high barriers to film and television copyright business, signed an order of 1.8 billion yuan with Tencent and supported by the performance forecast of the first quarter report, confirmed that the inflection point of the company’s operation has reached, the valuation level is expected to be further improved, and maintained and emphasized the “buy” rating.
Risk tips
The introduction progress of strategic investment shareholders is less than expected; The performance progress of film and television copyright contract is less than expected; Shiyou technology has a small volume, which will not have a significant impact on the company’s revenue and profit at present, and there is still uncertainty about the impact on the company’s performance and operating results in subsequent years.
