The game version number starts issuing again after an interval of 8 months, and the game sector may welcome the double boost of valuation and performance
On April 11, 2022, the State Press and Publication Administration released the first batch of game edition numbers issued in 2022. There are 39 online games approved by switch on the 4th and 8th of this month, including 4 online games approved by switch. A number of games of listed companies have been approved, including G-Bits Network Technology(Xiamen)Co.Ltd(603444) tower hunter, Wuhu 37 Interactive Entertainment Network Technology Group Co.Ltd(002555) dream voyage, Yoozoo Interactive Co.Ltd(002174) chronicles of the Three Kingdoms: Pocket battle, Party star of heart company, beware of fire and candle, friendship time, relic zero, Kingsoft, Jianwang 3: origin, etc. We believe that the overall valuation of the game industry has been suppressed since 2021 due to the slowdown in the growth of the game industry, the anti addiction policy for minors and the suspension of the issuance of game version numbers. The re issuance of game version numbers is expected to boost the overall valuation of the industry. In addition, various game manufacturers reserve high-quality games and launch them successively after obtaining the version number, which is expected to drive the overall growth rate of the game industry.
The acceleration of the game going to sea is expected to contribute considerable performance increment to relevant companies
According to the data of sensor tower, in 2021, a total of 42 Chinese mobile games earned more than US $100 million in overseas market, with an increase of 5 models year-on-year. The top 30 overseas revenue lists include games owned by Tencent, Netease, Wuhu 37 Interactive Entertainment Network Technology Group Co.Ltd(002555) and other manufacturers. Among them, Wuhu 37 Interactive Entertainment Network Technology Group Co.Ltd(002555) “Puzzles & survival” has become one of the few new games on the list with its unique “three consumer + SLG” playing method. In addition, Perfect World Co.Ltd(002624) “magic tower”, ” G-Bits Network Technology(Xiamen)Co.Ltd(603444) Yinian Xiaoyao”, “flashparty”, “T3” and other products of Xinxin company are preparing or have been launched overseas, and the process of mobile travel to the sea is accelerating. We believe that Chinese game manufacturers have the leading advantage of mobile game R & D ability and experience. The commercialization of tiktok is expected to further drive the increase of overseas market share of Chinese mobile game and contribute considerable performance increment to relevant companies.
Open world games may be the prototype of meta universe products, further opening up the growth space of the game industry
After continuous development and evolution, open world games have become the top category in the field of PC and host, and gradually expanded from host and PC to mobile phone, or become the main trend of mobile games in the future. According to data According to AI data, when the mobile open world game “original God” has been online for more than one year, it still won the first place in the 2022q1 global mobile game ranking. With the changes of the game market and the development of technology, other game manufacturers in China have also launched or arranged open world games. For example, the open world MMO game “magic tower” launched by Perfect World Co.Ltd(002624) has achieved 500 million yuan in the first month, and Tencent has approved the open world mobile game “King’s glory: the world” based on the king’s glory IP. We believe that with the continuous improvement of game engine technology and design ability, the form of game content may usher in continuous changes, providing an important source of digital content and technical basis for the meta universe. In addition, the game playing methods in the open world are highly integrated, which can meet the needs of multiple users, or effectively improve the scale of game users and game life cycle, release greater commercial value, and further open the growth space of the game industry.
Investment advice
We suggest that we propose to strengthen the allocation of game sectors at the current valuation low, and we propose to strengthen the allocation of game sectors at the current valuation low, with the focus on G-Bits Network Technology(Xiamen)Co.Ltd(603444) 44 , Hangzhou Electronic Soul Network Technology Co.Ltd(603258) , Hangzhou Shunwang Technology Co.Ltd(300113) , Hubei Century Network Technology Inc(300494) .
Risk tip: the performance of the new game is less than expected, and the number of game version numbers is less than expected.
