\u3000\u3 Shengda Resources Co.Ltd(000603) 444 G-Bits Network Technology(Xiamen)Co.Ltd(603444) )
Event:
The company issued the 2021 annual report.
Comments:
Self developed products contribute to the increment of income, and high dividends highlight the long-term value
In 2021, the company achieved a revenue of 4.619 billion yuan, a year-on-year increase of 68.44%. It mainly contributed to the steady growth of the core product “ask” series, and the self-developed mobile game “Yinian Xiaoyao” contributed the main incremental revenue. By the end of 2021, the registered users of the product had exceeded 10 million. “Moore Manor”, “eight wastes of ghost Valley” and “underground castle 3” were launched. The net profit attributable to the parent company was 1.468 billion yuan, a year-on-year increase of 40.34%. The net profit deducted from non parent company was 1.226 billion yuan, with a year-on-year increase of 36.24%. The profit growth rate is lower than the revenue growth rate, which is mainly due to the high marketing expenditure of Yinian Xiaoyao. The Hong Kong, Macao and Taiwan version was launched in October 21, and the promotion cost has not been profitable yet. Affected by amortization cycle and R & D share confirmation rules, products such as Moore Manor, underground castle 3 and world ejection story have not generated profits yet. The gross profit margin was 84.88%, a year-on-year decrease of 1.12pct, mainly due to the increase in the proportion of agency product revenue of joint operation. The sales expense ratio was 27.57%, with a year-on-year increase of 16.66pct, mainly due to the increase of marketing expenses such as the launch of many new games in China and the overseas layout of Q4 in 21 years. In a single quarter, Q4 achieved a revenue of 1.134 billion yuan, a year-on-year increase of 63.68%. The net profit attributable to the parent company was 263 million yuan, a year-on-year increase of 4.48%. The sales expense ratio was 38.69%, up 12.78pct month on month. The online and overseas promotion expenses of Xinyou were mainly concentrated in Q4. In terms of dividends, the company plans to pay 160 yuan for 10 shares, and the high dividends highlight the long-term value.
Acting IP mobile game “Obi island”, a variety of reserved products have obtained version numbers
In terms of pipeline, the company will act as an agent for the Baiao family interactive R & D community to develop the mobile game Obi Island: a dream country. Obi Island, as another emotion of a wide audience, has registered more than 300 million page games to IP. It is expected that the product will be launched within 22 years. At present, the number of reservations on the official website has exceeded 4.15 million. In addition, there are also products such as roguelike shooting mobile game “dawn elite”, cultivating RPG “flowers fall in Chang’an”, adventure RPG “lost four places”, simulated operation “project g”, ARPG “ancient treasures” (with edition numbers), SLG mobile game “project s”, national style RPG “Fengshen fantasy world”, simulated operation “Shendu kitchen king”.
Investment advice and profit forecast
The R & D side of the company adheres to the high-quality strategy of “small step and fast running”, converges the layout of the track, focuses on the advantageous categories such as placement, MMO and SLG, operates stably for a long time, and the self-developed game has made a breakthrough and contributed to the increment. We expect the company to realize a net profit attributable to the parent company of RMB 1.766/21.43/2.561 billion in 22-24 years, corresponding to eps24.5 billion 58 / 29.82/35.64 yuan, pe15x / 13X / 10x, maintaining the “buy” rating.
Risk tips
The flow of old games in the head is declining rapidly, the launch of new games is less than expected, and the industry policy risk
