Mango Excellent Media Co.Ltd(300413) content innovation and upgrading, drama integration and double line development, and user growth can be expected

\u3000\u30 Beijing Telesound Electronics Co.Ltd(003004) 13 Mango Excellent Media Co.Ltd(300413) )

Key investment points:

Active innovation and change, characteristic state-owned new media platform, and Hunan Satellite TV form a dual platform driven development. Mango TV was born in the third round of reform of Hunan Radio and television, forming a development pattern of “one body, two wings and double platform drive” with Hunan Satellite TV, and has a full license of IPTV / Ott. At the same time, relying on Hunan Satellite TV and China Mobile, we can fully obtain the collaborative advantage of “content + operator”.

Content output: talent based, drama integration and double line force. 1) Production system: establish studio system internally and iterate continuously; Further establish a variety project approval committee and a film and television drama Planning Committee to effectively control program costs and improve the yield of film and television dramas. External connection of Hunan Radio and television resources, two-way access to talent, content, incentive mechanism, etc; Expand third-party strategic cooperation and accelerate the layout of online content such as dramas and short videos. 2) Content: double line of drama synthesis, innovation and upgrading of content. Variety is the foundation of the platform. From the initial transplantation of Hunan Satellite TV to the reverse output of popular variety, mango IP operation is constantly iterative; It is estimated that more than 40% of the innovative variety shows will be launched in 2022, and the leading position of variety shows is expected to continue to be consolidated. The series focuses on making up for weaknesses and is committed to expanding the circle of users. In May 2021, the monsoon theater linked by the station network was launched, and the effective broadcasting accounted for 10% of the whole year; Adhering to the principle of improving the hit rate and good product rate, it is expected to harvest members and traffic at a lower cost.

Commercial realization: with long video as the core, content e-commerce expands the second growth curve. 1) Members: there is room for improvement in both quantity and price. By the end of 2021, mango has 50.4 million paying members, and it is expected that the medium and long-term potential paying members will exceed 80 million, with more than 60% growth space; In 2021, the ARPU value of members is 85 yuan (iqiyi 168 yuan), and there is more room for subsequent members to raise prices. 2) Advertising: the self-made S-level variety show and stable comprehensive N-generation have strong investment attraction ability, driving the counter trend growth of platform advertising. Diversification of advertising forms and customization of content; At the same time, the station network jointly attracts investment to maximize the brand value of content. 3) Xiaomang e-commerce: gather mango ecology and deeply integrate “video + content + e-commerce”. The daily activity peak will reach 1.26 million in 2021. More attention will be paid to Gmv assessment indicators in 2022. It is expected to introduce external strategic investors and strengthen resource support in terms of capital and user traffic.

Investment suggestion: the company’s content broadcasting situation will improve in 2022. It is still optimistic about the company’s excellent content production ability and perfect content marketing system for a long time. Xiaomang e-commerce platform is expected to develop. It is estimated that the company will achieve revenue of 15.353 billion yuan / 18.423 billion yuan / 21.739 billion yuan in 2021 / 2022 / 2023, EPS of 1.17 yuan / 1.37 yuan / 1.63 yuan, and corresponding PE of 27.14 times / 22.37 times / 18.80 times. We give the company 25-30 times PE based on 2022, with the corresponding price range of 34.25-41.10 yuan, maintaining the “recommended” rating.

Risk warning: policy supervision risk; Membership growth is less than expected; Advertising investment was less than expected.

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