\u3000\u3 Shengda Resources Co.Ltd(000603) 444 G-Bits Network Technology(Xiamen)Co.Ltd(603444) )
Core conclusion
Event: the company released the annual report of 2021, and achieved an annual revenue of 4.619 billion yuan, a year-on-year increase of 68.44%; The net profit attributable to the parent company was 1.468 billion yuan, a year-on-year increase of 40.34%.
The proportion of independent operating income continued to increase, and the investment in marketing and promotion was large. Among the game revenue, the independent operation revenue was 2.039 billion yuan (YoY + 70.19%), accounting for an increase of 0.46 percentage points to 44.27%, and the revenue scale was similar to that of joint operation products. The sales expense rate was 27.57%, a significant increase of 16.66 percentage points year-on-year. The company has maintained a high investment in marketing and promotion this year mainly due to the launch of many heavy mobile games such as “Yinian Xiaoyao”, “underground castle 3: Soul poem” and “Moore Manor” during the reporting period, as well as the holding of the fifth anniversary of “ask mobile games”.
“Yinian Xiaoyao” contributed to the main profit increment, and “ask for a hand tour” made steady progress. In 2021, the company’s main profit increment comes from the new research Tour “Yinian Xiaoyao”. Since its launch in early February, it has ranked 10th in the best-selling list of Qimai data IOS games on average. It is expected that the game will continue to make steady contributions to the flow of water. According to Qimai’s data, IOS ranked 20th on average in the best-selling list in 2021, significantly higher than the average ranking of 26th in 2020, and the overall flow maintained a stable growth.
Abundant product reserves and accelerated overseas market layout. Looking forward to 2022 and beyond, among the company’s agent product reserves, “Obi Island: a dream country”, “dawn elite”, “Hualuo Chang’an”, “lost four territories” and “ancient treasures” have obtained edition numbers and diversified categories. At the same time, the company actively adjusts its strategy and will further increase its investment in going to sea in the future. In addition to gradually transplanting Chinese mature products to the world, the company has positioned the global market since the beginning of the project, which is expected to open up space for improvement.
Profit forecast and investment suggestions: we expect the net profit attributable to the parent company in 2022 / 23 / 24 to be RMB 1.821/21.86/2.554 billion, with a year-on-year increase of 24.0% / 20.0% / 16.8%. Maintain the “buy” rating.
Risk tip: the head game is aging, the new tour water is less than expected, the competition is intensified, and the policy risk is high
