\u3000\u3000 Perfect World Co.Ltd(002624) (002624)
Event: Perfect World Co.Ltd(002624) released the performance forecast for 2021. It is estimated that the annual net profit attributable to the parent company will be 350-390 million yuan, a year-on-year decrease of 74.8% – 77.4%; Deduct non net profit of RMB 100-120 million, a year-on-year decrease of 88.5% – 90.4%. Among them, the net loss attributable to the parent company in Q4 in a single quarter was 410-450 million yuan, and the non net loss deducted was 440-460 million yuan.
The impairment loss of film and television business is accrued due to the impact of epidemic and other factors: in 2016, the company’s fund signed a single film investment and strategic cooperation agreement with Universal Pictures. Affected by repeated overseas epidemics and other factors, the income of some film projects was lower than expected. According to the preliminary calculation, the impact of the decline in fair value of the single investment on the net profit attributable to the parent company during the reporting period was about 260 million yuan, which was included in the non recurring loss. At present, the whole investment is coming to an end, and there are still two films that have not been released. The company has made a relatively stable prediction on the subsequent recovery.
Streamline the game business and focus on the main track: due to the suspension of edition numbers and other reasons, the game industry has changed the previous extensive research and development method of setting up a large number of projects, and turned into a high-quality production mode. In order to comply with this trend, the company streamlined and optimized the game team in 2021. The main R & D team of the company focused on two relatively large directions, one is the relatively traditional MMO and “MMO +” direction, and the other is the multi person open world and card types that favor young users. The optimization cost of this part has caused the increase of management expenses to a certain extent.
“Magic tower” will become the performance increment in 2022: the company’s key product “magic tower” was officially put into public beta in December 2021, with nearly 500 million water in the first month and more than 10 million new secondary users. Magic tower adopts the strategy of light buying volume and more strategies of community word-of-mouth marketing and product absorption to obtain users, forming a high ROI. Due to the deferred income, the contribution of magic tower to the revenue in 2021 has not been released, which is expected to become the main increment of the company’s performance in 2022.
Investment suggestion: we predict that the company will realize the net profit attributable to the parent company of RMB 380 million, RMB 1.556 billion and RMB 2.082 billion from 2021 to 2023. Based on the company’s strong self-research ability, the company will be given a “overweight” rating of 20 times of the net profit in 2022 and a target price of 16.04.
Risk warning: the flow of new products is less than expected; The film and television business is affected by the epidemic: the release of version number is delayed.
