\u3000\u3000 Zhewen Interactive Group Co.Ltd(600986) (600986)
Event: the company recently released a performance forecast. The company expects to realize a net profit attributable to the parent company of RMB 278-317 million in 2021, with a year-on-year increase of 195% to 236%; Deduct non net profit of RMB 222-261 million, with a year-on-year increase of 209% to 264%.
Focusing on the main business, the marketing business rebounded rapidly. During the reporting period, the company operated steadily, stripped off real estate and other businesses in an all-round way (generating more non recurring income), continued to focus on the development of its main business, deepened its digital marketing business, continuously improved its core competitiveness, and its business scale increased significantly,. The ability of expanding customers in the automobile marketing sector continued to increase, and the number of new orders increased significantly; The precision marketing sector focuses on core media resources, and the average daily consumption scale continues to climb.
We will continue to promote the introduction of fixed growth and state-owned assets. The company plans to issue no more than 165 million non-public shares and raise no more than 800 million yuan in total for businesses including AI intelligent marketing system, live broadcast and short video intelligent marketing ecological platform projects. After the completion of the fixed increase, Zhejiang cultural investment is expected to hold 16.47%, which will empower listed companies from multiple dimensions such as industrial resources, policies, credit and licenses. At present, the intelligent marketing platform of live short video has several live teams in Hangzhou. Later, it will increase the layout and try to combine other film and television and star resources.
The virtual human market broke out and the company’s business has been implemented. At present, the Zhejiang an Guohe team of the joint venture company has independently developed and successfully incubated two virtual characters of overseas wind virtual IP “Jun ruojin” and z-generation virtual IP “Lan Lan”. Among them, China Wind virtual IP “Jun ruojin” was officially launched in the whole network on November 13, 2021. Generation Z virtual IP “Lan Lan” is positioned as a virtual artist. At the same time, the company has opened personal accounts for virtual human images in many social media public platforms in China, such as xiaohongshu and microblog. At present, virtual human related businesses have orders from customers in automobile, food, e-commerce, real estate and other industries.
Maintain the “overweight” rating. Since 2019, the company has introduced state-owned shareholders, improved the governance structure and stabilized the team, realized the overall recovery of business, and actively arranged a number of new businesses including virtual people. Not considering the fixed increase for the time being, it is estimated that the net profit attributable to the parent company in 21-23 years will be RMB 304 / 408 / 549 million, and the corresponding PE will be 27 / 20 / 15 times respectively, maintaining the “overweight” rating.
Risk tip: the risk that the market competition intensifies and the growth of new business does not meet expectations.
