\u3000\u3 China Vanke Co.Ltd(000002) 555 Wuhu 37 Interactive Entertainment Network Technology Group Co.Ltd(002555) )
Event: the company released the 2021 annual report and 22q1 performance forecast. In the 21st year, the company realized a revenue of 16.216 billion yuan (YoY + 12.62%), and a net profit attributable to the parent company of 2.876 billion yuan (YoY + 4.15%); The company expects to realize a net profit attributable to the parent company of 740 ~ 770 million yuan (YoY + 533.7% ~ 559.4%) in 22q1.
The expansion of self-developed categories, excellent overseas performance, and the release of Xinyou profit drive the company’s performance to continue to increase. 21q1 / Q2 / Q3 / Q4 company realized a net profit attributable to the parent company of RMB 117 / 7.37 / 867 / 1.154 billion, with a year-on-year increase of – 84.0% / – 24.1% / + 54.8% / + 130.5%. The accelerated performance growth was mainly due to the profit release of the heavy self-developed new tour Douluo mainland: duel of soul masters and the excellent performance of the overseas market. From August to December, the company ranked among the top 5 in the global revenue list of Chinese mobile game publishers of sensortower.
1) Chinese market: in 21 years of operation, the highest monthly flow of mobile games in China is 1.7 billion + and the highest Mau is 4.6 million +. During the year, the newly launched self-developed Games “glory Archangel”, “Douluo mainland: duel between soul masters”, agent Games “Douluo mainland: Awakening of Wu soul” and “call me big shopkeeper” ranked 188 / 25 / 135 / 65 on the 22q1ios best seller list. Among them, the monthly flow of the self-developed card mobile game soul master has exceeded 700 million yuan, and has been ranked in the top 30 of the best-selling list so far. It is expected to continue to contribute to the stable flow of long-term operation. The excellent realization of the game is the Ranger verification of the company’s enhanced R & D strength. The R & D investment of 21y company ranges from + 12.37% to 1.25 billion yuan.
2) overseas market: in the past 21 years, the overseas revenue increased from + 122.9% to 4.777 billion yuan year on year, accounting for an increase of 14.6pct to 29.5% in the proportion of revenue. The highest monthly flow of overseas Games was 700 million + and the highest number of mau8.5 million people +. Among them, “Puzzles & survival” has accumulated more than 2.5 billion yuan by the end of the year, and the average ranking of 22q1 US / Japan IOS best seller list is 28 / 15 respectively, maintaining excellent liquidity; The Korean version of “song of cloud going to the city” ranked the top 5 on the IOS bestseller list in mid-21. The launch of the daily service version of “air brave group” in February 22 drove the overseas revenue of the game to + 19% month on month in February, and ranked 16th / 14th in the revenue of sensorpower’s Chinese mobile games in February and March respectively. It is expected that 22q1 “P & S” and “cloud going to the city” will continue to contribute to a stable flow of water. Recently, Chrono Legacy (Sanxiao + SLG), Douluo mainland: duel between soul masters, Three Kingdoms: glory of Heroes (self-developed SLG of Three Kingdoms), ant Legion (ant theme developed by easy entertainment) and other new tours have been launched / launched in different overseas regions, which is expected to contribute to the increment of overseas performance in the future.
The restart of the version number may drive the recovery of the industry, and the global issuance of the company’s reserved products can be expected. In April of 22, the version number of domestic online games was resumed, and a total of 45 new games obtained the version number. The company reserves nearly 30 products at home and abroad. The agent games such as dream sailing, dawn plan, the last primitive man and fortress of the air: set sail have obtained edition numbers. The key reserve games such as self-developed game code magic m (Western magic MMO), code C6 (multi civilization theme card) and code ancient style (ancient style MMO) are planned to be released globally, which is expected to support performance growth in the future.
The release of the employee stock ownership plan demonstrates confidence in long-term development. The company plans to grant a total of 16.3 million shares (accounting for 0.74% of the total share capital) to no more than 650 employees. The target is that the growth rate of the company’s operating revenue / net profit (based on 21 years) will not be less than 15% / 25% / 35% respectively in 22-24 years, and the amortization expenses of the employee stock ownership plan in 22-25 years are expected to be 102 / 122 / 59 / 17 million yuan respectively.
Investment suggestion: the company has excellent performance in self research + going to sea and rich product reserves, which is expected to support future performance growth. Combined with the latest financial report, we raised the company’s profit expectation. It is expected that the company will realize the net profit attributable to the parent company of 33.35/38.08 yuan in 22 / 23, with a year-on-year increase of + 16.0/14.2% respectively, maintaining the “buy” rating.
Risk tip: industry competition intensifies, policy supervision risks, and product launch is less than expected.
