Tiger TV Media (01163.HK) achieved a total income of 140 million yuan in the first half of 2021, an increase of 16.7 percent in the same period last year, and profits decreased by 409% to 1376.3 million yuan compared with the same period last year. The rapid recovery of overseas regional operations and the expansion of the central region are designed to increase the momentum, but the low profit rate and high expenditure ratio during the transition period weaken the profitability of the market.
R & D expenditure is a qualitative factor: Tiger Media (01163.HK) intends to strengthen I) investment in online shopping systems and logistics management systems, ii) applications and iii) AdTensor. According to our forecast, every 5 million yuan of people's investment is the shadow of the 1.3% profit rate of the market, while we think that the level of 5 million yuan to 1000 yuan is currently regarded as a reasonable level.
The importance of China's region is increasing, but it has not been fully reflected: Tiger TV Media (01163.HK) spent about 4464.0 yuan on expenditure in the second quarter of 2021, with an environmental growth of 1.3 x in the first quarter of 2021. We agree that the progress of the Chinese region is slow and that the gathering may take more time to cultivate the area, but we still believe that the Chinese region will be one of the major sources of income in the future.
Overseas regional sales are expected to be fast: in the first half of 2021, 01163.HK overseas regional services are expected to recover quickly, and total expenditure is expected to increase by more than 30% in the same period last year. I am grateful for the strength of overseas regions, especially in India, one of the major markets, due to political factors, which means that areas outside India have recorded satisfactory growth. We expect that the growth of overseas regional services in the future will remain in the single digits.
The progress is slow but does not show the correct direction of development: Tiger TV Media (01163.HK) handed over a reasonable price in the first half of the year, and strong overseas regions offset the slow progress of China's regions. Our profit forecast for the market is about 17.4%-22.9%. At the same time, the target is cut to HK $1.10 per share, which is equivalent to the 27.4x/12.0x/7.8x forecast price-to-earnings ratio of 2021 / 2022 / 2023.