Gigabit (603444): Fast-growing company with strong game development and operation capabilities
Event: The company released its semi-annual report for 2019 and achieved operating income of 10 in the first half.
$ 7.1 billion, an increase of 37 per year.
70%; net profit attributable to mothers4.
650,000 yuan, an increase of 38 in ten years.
95%; net profit after deduction is returned to mother 4.
42 ppm, an increase of 45 in ten years.
Event comment: The company earnestly researched and developed independently and maintained higher investment in research and development.
The independent research and development ability is the core factor that determines the quality of an online game, which directly determines the stability, playability, and balance of the product. In addition, it affects the realization mode of the product and the penetrability of realization ability.
The company’s continuous high R & D investment provides guarantee for independent innovation.
As of June 30, 2019, the company had a total of 323 R & D personnel, accounting for 53 of the company’s total number of employees.
83% of the company’s R & D expenses in 2017, 2018, and the first half of 2019 accounted for 16 of its operating income during the same period.
Self-developed product: “Ask Mobile Games” has become more popular, and the newly launched “Alien Land” has performed well.
“Ask” has accumulated a large number of loyal user groups over the past ten years, creating the IP value of “Ask”. After the launch of “Ask Mobile”, the company continued to listen to user opinions and quickly iterate to meet the player experience in a timely manner.Demand, excellent operational capabilities make this game enduring.
In April 2019, the 3rd Anniversary of the “Ask Mobile Games” opened, and Zhou Huajian was invited to endorse and carry out a series of activities. Player feedback was good and the flow continued to rise.
In the first half of 2019, “Ask for Mobile Games” ranked 25th on the App Store’s best-selling list, up to number 5 on the list. As of June 30, 2019, “Ask for Mobile Games” gradually registered users.The number exceeds 33 million.
In May 2019, “Ask for Mobile Games” won the “2019 Best Popular Game Award” at the Samsung Developer Conference.
The Land of Alienation is a horizontal version of the action game with Roguelike random elements independently developed by the company. The game was launched on the App Store on May 16, 2019. It was recommended by TapTap editors on the same day.TapTap Hot List # 1.
In the first month of launch, “The Land of Alienation” has been on the top of App Store games for 24 days every day.
Since its launch, Alienation has received multiple recommendations from the App Store, such as today ‘s new tour recommendation, Today ‘s special recommendation, new tour banner and icon recommendation, and topical recommendation. As of June 30, 2019, Alienation is available on the App商店 商店游戏近似榜平均排名为第3名.
Agency-operated products: A number of games performed well.
The company has strong game operation capabilities, and many of the agents’ games have performed well. Among them: “Fantastic Maze” in the first half of 2019 in the App Store game rankings highest to 22nd, as of June 30, 2019, “The cumulative number of registered 淡水桑拿网 users of “Mysterious Maze” exceeds 16 million; in January 2019, “Greedy Cave 2” was shortlisted in “TapTap Annual Game Awards Most Popular Game”, and “Greedy Cave 2” was ranked in the App Store in the first half of 2019The highest ranking is 13th, up to 1st in the list; in the first half of 2019, “Underground Castle 2” was recommended by the App Store for the best update icon and 2 times of TapTap editor recommendations, ranking highest in the App Store to 4th。
In addition, the newly launched “Over the Star Arc” in 2019, “Fury Survivor” also achieved good results.
Investment suggestion: Under the assumption that the company’s game business maintains rapid growth, we expect the company’s EPS in 2019, 2020 and 2021 to be 12 respectively.
51 and 16.
64 yuan, corresponding P / E is 19 respectively.
57 times, 16.
47 times and 14.
At present, the latest P / E ratio (TTM, holistic method, excluding negative values) of the mobile Internet service industry is 19.
56 times, the company has strong game development and operation capabilities, and reserves a rich variety of games, we think the company’s estimate does have a certain room for improvement, so maintain its “overweight” level.
Risk reminders: Single game revenue accounts for relatively high risks; new game product development and operation risks; market competition risks; industry policy risks.