\u3000\u3 China Vanke Co.Ltd(000002) 624 Perfect World Co.Ltd(002624) )
Core view
Event: Perfect World Co.Ltd(002624) released the annual report of 2021 and the report of the first quarter of 2022: the total operating revenue in 2021 was 8.518 billion yuan, a year-on-year decrease of 16.69%, the net profit attributable to the parent company was 369 million yuan, a year-on-year decrease of – 76.16%, the basic EPS was 0.19 yuan and the average roe was 3.49%. In 2022q1, the operating revenue was 2.128 billion yuan, a year-on-year decrease of 4.60%, the net profit attributable to the parent was 840 million yuan, an increase of 80.99% year-on-year, and the net profit not attributable to the parent was 414 million yuan, a year-on-year increase of 30.15%. The basic EPS is 0.19 yuan and the average roe is 3.49%.
Performance pressure in 2021: the flow of old games is declining, overseas projects and film and television investment have suffered a one-time loss, and the profits of new games need to be released. The flow of old games declines with the life cycle, the online rhythm of new games is slow, and the effect of some projects is less than expected, which puts great pressure on the performance. “Dream new kill immortal” accumulated nearly 1.6 billion yuan in the whole year; The first month of magic tower is nearly 500 million yuan, and its performance contribution will be gradually released in 2022.
2022q1: the performance has improved significantly. Magic tower and dream new kill immortal contribute profits. In 2022q1, the company’s game business realized a revenue of 1.973 billion yuan, an increase of 23.01% over the same period of last year. The increase mainly came from “magic tower” and “dream new kill immortal”. Driven by games such as “dream new kill immortal” and “magic tower”, the gross profit margin of game business increased compared with the same period of last year.
Product trends: phantom tower is launched in version 2.0, focusing on the performance of core products at sea. The company’s core product “magic tower” version 2.0 “Vera space-time” was launched on April 25, and has started overseas testing this month. It is planned to officially launch overseas within the year, and Tencent will take over the Distribution Agency in some regions. “Dream new immortal” was launched in overseas market in March 2022.
Reserve items in 2022: the category reserves are abundant, and the comprehensive strength is expected to be enhanced. Mobile games include “black cat anecdote society”, “Tianlong Babu 2”, “Kingdom of morning and night”, “one punch Superman: the world”, “million King Arthur”, “killing immortals 2”, “perfect Shanghai New World Co.Ltd(600628) ” magic land 2 “; The end tour includes “immortal world”, “perfect new world” and “have a nice death”; In the preparation of cage, IP series, etc.
With the restart of the game version, the online progress of the company’s new tour is expected to accelerate, and the sea of key products will also improve the performance flexibility of the company. In 2022 / 2023 / 2024, the revenue will be 10.194 billion yuan / 11.630 billion yuan / 13.404 billion yuan, the corresponding net profit attributable to the parent company will be 1.881 billion yuan / 2.225 billion yuan / 2.501 billion yuan, and the corresponding EPS will be 0.94 yuan / 1.11 yuan / 1.24 yuan. Based on the closing price on April 26, PE is 14 times / 12 times / 11 times, maintaining the “buy” rating.
Risk tips: macro environmental factors; Regulatory policy factors; Project promotion factors; Content infringement factors
