In March 2022, the media (CITIC) index fell by 3.74%, outperforming the performance of Shanghai Stock Exchange and Shenzhen Composite Index in the same period. China concept stocks bottomed out in mid March, which also led to the valuation repair of A-share media sector. Repeated outbreaks in Shenzhen, Shanghai and other places are expected to have a certain impact on outdoor advertising, cinema, publishing and other sectors. The performance of yuancosmos theme market is relatively scattered. From the industrial level, the layout of overseas giants is still continuing. Meta plans to establish a new engineering center in Canada. The mass production version of metacambria (Seacliff) may be ready. Sony psvr2 official website has been officially launched and registered. ChinaByte may raise Pico’s sales target from 1 million to 1.8 million. Ar glasses manufacturer nreal announced that it has completed the round C + financing of 60 million US dollars (about 380 million yuan), It is recommended to maintain continuous attention. In April, it entered the intensive period of annual report and first quarterly report, focusing on high performing companies in the short term; In the medium term, we will pay attention to the recovery of the affected sectors of the epidemic and the recovery of entertainment advertising and investment promotion. All sectors of the media are stepping up efforts to go to sea, including games, video, marketing, online text and other fields. It is suggested to continue to track the industrial trend and related opportunities. We are optimistic about the development opportunities brought to the media industry by entertainment going to sea and the next generation Internet. Based on this, we give the industry a “recommended” rating.
Looking ahead to 2022, focus on the following opportunities:
1) high quality content companies, mainly including game and video sectors. At present, the valuation of the game sector is 14-17x. After the bottom rebound of zhonggai shares in mid March, the game sector has also achieved a good rebound. At present, the core focus of the market on the sector is still the distribution progress of Chinese game titles. We keep a constant focus on the game going to sea. Highlight Wuhu 37 Interactive Entertainment Network Technology Group Co.Ltd(002555) , G-Bits Network Technology(Xiamen)Co.Ltd(603444) , Perfect World Co.Ltd(002624) . The video sector pays attention to the impact of changes in industry pattern, price increases and controllable factor costs on performance in the medium and long term, and the improvement of investment attraction of variety advertising in the medium and short term. We recommend a platform with leading self-control ability, focusing on Mango Excellent Media Co.Ltd(300413) .
2) new content and new consumption companies with private domain capabilities. Tide play is one of the sectors with the highest growth rate in the pan entertainment field. We pay attention to the changes of supply and demand. We believe that the core driver of tide toy sector is to create demand for supply and pay attention to companies with leading IP exploration and operation capabilities. Bubble mart is highly recommended.
3) companies benefiting from the increase of flow price. Highlight Focus Media Information Technology Co.Ltd(002027) , the company’s medium-term logic remains unchanged, and the scarce brand media value highlights under the background of rising traffic prices. Pay attention to the impact of the epidemic and the subsequent inflection point in the short term.
4) meta universe theme, mainly copyright and IP related owners and application related (VraR content, exhibition, virtual human, digital collection). Focus on Visual China Group Co.Ltd(000681) , Shanghai Fengyuzhu Culture Technology Co.Ltd(603466) , Bluefocus Intelligent Communications Group Co.Ltd(300058) , Three’S Company Media Group Co.Ltd(605168) , etc. In the education sector, it is suggested to continue to pay attention to the reform of vocational education system, including opportunities related to secondary vocational education, vocational undergraduate education and quality education, with emphasis on Jiangsu Chuanzhiboke Education Technology Co.Ltd(003032) , China Oriental Education and higher education.
Risk tips: stricter policy supervision, less than expected launch progress and market performance of key products, less than expected performance of key companies, intensified market competition, risk of lifting the ban and reducing holdings, corporate governance risk, market style switching, relevant data are for reference only, etc.
