\u3000\u3 China Vanke Co.Ltd(000002) 555 Wuhu 37 Interactive Entertainment Network Technology Group Co.Ltd(002555) )
Event: the company released the 21st Annual Report and 22q1 performance forecast on the evening of April 25, 22 Wuhu 37 Interactive Entertainment Network Technology Group Co.Ltd(002555) 21 years, the revenue reached 16.216 billion yuan, yoy + 12.62%; The gross profit is 13.75 billion yuan and the gross profit margin is 84.79%, yoy-3.00pct. In 21 years, the company’s sales expense was 9.125 billion yuan, yoy + 11.11%, and the sales expense rate was 56.27%, yoy-0.77 PCT; The management fee is 463 million yuan, yoy + 26.37%, the management fee rate is 2.85%, yoy + 0.31pct; Financial expense is -55 million yuan, yoy-139.88%, financial expense rate is -0.34%, yoy-0.18pct; The R & D cost is 1.25 billion yuan, yoy + 12.37%, and the R & D cost rate is 7.71%, yoy-0.02pct. In the 21st year, the net profit attributable to the parent company was 2.876 billion yuan, yoy + 4.15%, higher than the upper limit of advance notice (2.80 ~ 2.85 billion yuan in advance notice); Deduct 2.627 billion yuan of non return to parent, yoy + 9.82%. In 21 years, the company plans to distribute cash dividend of RMB 3.7 (including tax) for every 10 shares, with a total amount of RMB 821 million and a cash dividend rate of 28.54%. At the same time, the company predicted that the net profit attributable to the parent company in 22q1 was 740 million ~ 770 million, yoy + 533.71% – 559.40%, deducting 740 million ~ 770 million, yoy + 1920217% – 1998469%, which was mainly due to the low base caused by the high promotion cost of new tour in 21q1 and the entry of 22q1 products into the profit recovery period.
Overseas strategy continues to grow and accelerate globalization. In 21 years, the revenue of overseas Games was 4.777 billion yuan, yoy + 122.94%, accounting for 29.46% of the revenue, yoy + 14.58pct, mainly due to the outstanding performance of products such as Puzzles & survival, call me the big shopkeeper, the song of cloud going to the city and Douluo mainland: Duel between soul masters. Among them, by the end of the 21st century, the accumulated flow of “three consumers + SLG” mobile game “Puzzles & survival” had exceeded 2.5 billion yuan, ranking fourth in the global mobile game revenue growth list in the 21st year according to sensortower. Different world adventure MMO mobile game “song of Cloud City” entered the top 5 of the best-selling list in South Korea, and ranked among the top 20 of the overseas revenue list of domestic mobile games.
Strengthen the integration of research and operation, and continue to increase R & D investment. In 21 years, the R & D investment was 1.25 billion yuan, yoy + 12.37%, and the R & D personnel exceeded 1900, accounting for 48.97% of the total employees. The company has developed AI big data computing power research and operation platform “Zeus”, which can flexibly carry out in-depth learning and calculation to realize operation and maintenance automation, cost reduction and efficiency increase. The company’s self-developed card “Douluo mainland: duel between soul masters” is distributed in content. After going online, it ranks the highest in the best-selling list of IOS games, ranking 11th on average, which is an effective verification of the enhancement of the company’s research and transportation strength.
The subsequent reserve games are rich, and the beneficial version number returns to normal. The company reserves MMO, SLG, cards, simulation operation and other multi category games, covering magic, immortal Xia, city, women and other types of themes. The diversified product matrix has begun to take shape. Among them, MMO mobile Tour “dream Voyage”, “dawn plan”, “handed down light”, card mobile Tour “the last primitive man” and “fortress of the air: sailing” have won Chinese version numbers.
Keep up with the development trend of science and technology, and layout the meta universe enabling innovation business Wuhu 37 Interactive Entertainment Network Technology Group Co.Ltd(002555) cut into the fields involved in the bottom of the multi-element universe through investment, and invested in a number of high-quality enterprises including optical modules, optical displays, AR glasses, VR content, cloud games, space intelligent technology and semiconductor materials. At present, the related enterprises of metauniverse invested or acquired by the company include archiact, waveoptics, raxium, digilens, chenjing technology, yingmu technology, Guangzhou semiconductor, JingZhan semiconductor, fast disk cloud game, etc.
Investment suggestion: we expect the company’s net profit of 22-24 years to be RMB 3.312/37.95/4.266 billion, with a year-on-year increase of 15.17% / 14.59% / 12.40%, corresponding to the valuation of 13X / 12x / 10x. Give 20xpe for 22 years, and the target price for 22 years is 29.8 yuan, maintaining the “buy” rating.
Risk warning: the running water does not meet expectations, the industry supervision is becoming stricter, and the release of version number is less than expected; The specific data disclosed in the first quarter of 2022 shall prevail
