\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 986 Zhewen Interactive Group Co.Ltd(600986) )
Key investment points
The company’s main business has formed the layout of three sectors: brand marketing, effect marketing and innovative business, and the multi-dimensional empowerment of state-owned shareholders
The company has advanced from digital marketing to digital culture strategy. In 2021, the company further strengthened risk control, comprehensively focused on the main business of digital marketing, actively laid out the digital ecological track, steadily promoted equity restructuring, introduced Zhejiang cultural investment as the controlling shareholder of the company and relocated to Hangzhou (Zhejiang Provincial Department of Finance became the actual controller of the company). The preliminarily established mixed ownership governance structure of state-owned relative holding is conducive to the steady development of the company, from the introduction of business resources, financing, credit enhancement Assistance in project implementation and other dimensions.
Reduce goodwill in 2019, optimize the main business, conduct epidemic stress test in 2020, achieve steady growth in the main business of digital marketing in 2021, and expect new business increment from 2022 to 2023
In 2021, the company stripped off traditional businesses such as real estate and focused on the main business of digital marketing. In 2021, the company’s brand and effect marketing revenue were 3.05 billion yuan and 11.096 billion yuan respectively (accounting for 21% and 78% of the total revenue), and its attributable profits were 189 million yuan and 118 million yuan respectively (with a year-on-year growth rate of 127% and 237.7%). In 2021, the company’s main business of digital marketing increased steadily, in which the automobile industry dominated brand marketing. On the profit side, from 2018 to 2021, the company’s profit attributable to the parent company was 263 million yuan, – 25.1 million yuan, 94 million yuan and 294 million yuan respectively (the year-on-year growth rate was – 43%, – 1054%, 104% and 212% respectively), and the company’s revenue was 14.2 billion yuan, 18.9 billion yuan, 9.3 billion yuan and 14.3 billion yuan respectively (the year-on-year growth rate was 50%, 33%, – 51% and 54% respectively). On the goodwill side, the company’s provision for goodwill impairment in 20182019 was RMB 270 million and RMB 2.597 billion respectively. By the end of 2021, the company’s goodwill balance was RMB 976 million. The proportion of goodwill book value in the company’s net assets decreased from 27% in 2020 to 25% in 2021 (the proportion decreased and the company identified the goodwill impairment test as a key audit event, and the potential impact of goodwill factor gradually decreased); In 2021, exploring new tracks and incubating new businesses, such as digital assets in metauniverse, E-sports event prediction and live e-commerce, will lay the foundation for the redevelopment from 2022 to 2023, and the new volume can be expected.
How does the company’s meta universe economy speed up innovation?
In the yuan universe sector, the company cuts in from digital assets and virtual people, and forecasts the layout of E-sports events, which are expected to promote the extension of the company’s main business from end B to end C. Digital human side, the company independently develops and incubates Guofeng virtual IP junruojin and z-generation virtual IP LAN LAN, and its new business can also empower the company’s original brand advertisers; At the digital collection end, Mita digital art platform is set up, which has resources such as museum, film and television and E-sports IP, and tens of millions of end users; At the prediction end of E-sports events, the company is committed to building an E-sports fan community. The products provide functions such as event data analysis, entertainment prediction and playing methods, derivative points consumption (the events in the middle of the 2022 sports year are conducive to promoting the development of the business), and retain a large number of E-sports fan users to provide an accurate flow pool for yuanyuzhou ecology.
Profit forecast
For the first coverage, give a “recommended” rating. On December 29, 2021, the company plans to issue no more than 165 million shares (raising 800 million yuan) to Bowen investment, a wholly-owned subsidiary of Zhejiang cultural investment, a state-owned shareholder. If the fixed increase is completed, the shareholding proportion of Zhejiang cultural investment will be further increased. Based on the principle of prudence, the impact of the fixed increase on the company’s performance will not be considered temporarily. We expect the company’s revenue from 2022 to 2024 to be 16.93 billion yuan, 19.25 billion yuan and 20.95 billion yuan respectively, and the profit attributable to the parent will be 380 million yuan, 490 million yuan and 560 million yuan respectively, EPS is 0.29, 0.37 and 0.42 yuan respectively, and the corresponding PE of the current stock price is 23.8, 18.7 and 16.3 times respectively.
In 2021, the company completed the change of actual controller, and the mixed ownership governance structure has achieved initial results. In 2022, the company will actively develop the digital economy on the basis of consolidating the basic sector. The advantages of state-owned shareholders are conducive to endorsing the company’s E-sports event prediction business, and set up a new driving force for yuancosmos incubation and growth (seizing the leading position of yuancosmos automobile marketing, and integrating resources such as virtual people and digital collections is also expected to empower the main business), Based on the steady growth of the main business, the innovative business is flexible, and then the “recommended” investment rating is given.
Risk tips
The risk of examination and approval of non-public offering of shares, the risk of core brain drain, the risk of accounts receivable, the risk of impairment of goodwill, the risk of concentration of media traffic suppliers, the risk of tax policy, the risk that the promotion of new business is not as expected, the risk of intensified market competition, the risk of covid-19 epidemic fluctuation and the risk of macroeconomic fluctuation.
