Industry core view:
Last week, the media industry (Shenwan) rose 0.7%, ranking 12th in the market, outperforming Shanghai and Shenzhen 300. Shenzhen Zqgame Co.Ltd(300052) the chairman released the demonstration video of wine maker. We believe that the playability of the game mainly focuses on virtual mapping reality and online and offline wine extraction. From the perspective of art style, the picture refinement needs to be improved, and the sense of immersion is far from the concept of meta universe virtual world. We will continue to pay attention to the update of future versions. Shanghai Xuhui’s layout of “meta universe” hopes to boost the exponential growth of digital economy, and meta universe is expected to make great strides forward. We believe that this can promote more mutual integration and output of enterprises and technologies in relevant fields, and help the regional digital economy achieve exponential growth during the 14th five year plan period. Key investment points:
Games: 1) Gamma data released the China game investment and financing report. There were 209 investment events in 2021, with a total amount of nearly 26 billion. 2) Sensortower released the global revenue ranking of national tour publishers in mid December 2021, attracting a total of nearly $2.1 billion. Among them, Perfect World Co.Ltd(002624) new tour “magic tower” ranked first in China’s IOS mobile game download list for 6 consecutive days and entered the top three of the best-selling list with its popular open world setting and two-dimensional science fiction theme. The income of issuers rose sharply, with a month on month increase of 106.4%. 3) The chairman of Shenzhen Zqgame Co.Ltd(300052) released the demonstration video of the meta universe game “winemaker”. After that, it will also launch “2D, 3D (including lock perspective), VR, overseas and Robles versions”. 4) Tencent wholly acquired Letong excellence, which once developed the “my name is Mt” series.
Internet application: 1) Shanghai Xuhui’s layout of “meta universe” hopes to boost the exponential growth of digital economy, and meta universe is expected to make great strides forward. In 2022, the two sessions of Xuhui District will be held. The “meta universe” will be written into the government work report for the first time, so as to seize the vent of digital economy development, explore the establishment of meta universe innovation alliance, promote the integrated development of artificial intelligence and cultural creativity, green low-carbon and intelligent manufacturing, promote product R & D, production and application in relevant fields, and create a new highland of digital economy. 2) Station B enters NFT, the first digital art avatar. It is particularly noteworthy that the threshold for users who can participate in the subscription of avatars is very high – users with lv6 and use BiliBili every day from January 1, 2021 to December 31, 2021. This measure may be to strictly prevent speculation. 3) The National Radio and television work conference was held, and Beijing Bureau: comprehensively stop idol cultivation network integration and delay and change drama. Play a good “combined fist” in comprehensive management of culture and entertainment. Resolutely handle the public opinion event of iqiyi’s “youth has you 3”, timely release measures and strengthen the management of online variety shows. We will carry out in-depth special research, comprehensively stop online film and television dramas with the theme of “idol cultivation” and “delay change”, seriously carry out special inventory in the field of online film and television dramas, short videos and live broadcasting, and strive to create a clean and healthy online cultural space in the capital.
Investment suggestion: comply with the strict regulatory environment of the policy, promote industrial reform, and grasp the innovation needs brought by the post epidemic era and Z era. 1) Game: the epidemic dividend has faded. It is suggested to pay attention to the individual stocks in the product line that are developed for the new generation of users, have well-known IP, have high expectations and good test feedback; At the same time, driven by the concept of “meta universe”, it is expected that the ecological construction of VR content will become the focus of the market in 2022; 2) Film and television cinemas: focus on leading cinemas and individual stocks; 3) Film and television series: diversified theatres and mini dramas will be the focus of the development of the video industry. It is suggested to pay attention to individual stocks with strong content IP commercialization ability; 4) Advertising marketing: focus on individual stocks of ladder media.
Risk factors: stricter regulatory policies, delayed launch and less than expected performance of Xinyou, increased risk of overseas business, repeated epidemic risk and goodwill impairment risk.
