Source: Gelonghui

Influenced by the issuance of the first batch of imported game versions in 2023, game stocks in the Hong Kong A market collectively rose today.

As of press release, in terms of Hong Kong stocks,$OURGAME (06899.HK)$An increase of nearly 14%,$BILIBILI-W (09626.HK)$,$FRIENDTIMES (06820.HK)$An increase of about 4%,$XD INC (02400.HK)$An increase of more than 3%.

In terms of A-shares, Tianyu Mathematics and Lianwei rose nearly 10%, Kunlun Wanwei rose more than 9%, Shenzhou Taiyue rose more than 8%, Glacier Network and Giant Network rose nearly 4%, and Yao Ji Technology and Youzu Network followed suit.

Overall, with the normalization of the distribution of editions and AIGC revitalizing the industry in the second spring, the game market has gradually picked up since 2023. Among them, the A-share gaming sector has seen a cumulative increase of nearly 41%.

27 imported online games approved

Yesterday,The State Press and Publication Administration announced the approval information for imported games in 2023. A total of 27 imported games have been reviewed.(Click for more details)

Among them, Xindong's “Painted World” and “The Legend Mage”, NetEase's “Dance Company: National Party”, Tencent's “Manor Synthesis”, “Mecha Team” by Chuangqing Bao, “The Hungry Painter”, and Bilibili's “Shine! “The Handsome Girl” and others are on the list.

Since this year, the State Information Administration has announced 96 game versions in January and 87 game versions in February, and this time they are issuing imported game versions. It is worth mentioning that this time it is less than 3 months since the approval numbers for the 44 imported online games announced on December 28 last year were issued.

Looking back,From the approval of imported game versions over the past three years, the number of imported game versions issued in 2020 was 97 throughout the year, dropped sharply to 76 in 2021, and dropped to 44 in 2022.

According to some market analysts, the 2022 imported game version number was only distributed once. This year's imported game version number was announced in March, which indicates that imported game versions may be issued again this year. Whether in terms of frequency or quantity, version number distribution has stabilized.

The DataEye Research Institute stated:

“Generally speaking, the imported edition is only sent once a year. Although the number of imported versions is small today, the imported edition will be sent again within 3 months, so we can't help but look forward to the fact that the imported edition will probably be issued more than once this year. The review is still strict, and there aren't many expectations each time. However, behind this, it shows that the boosting effect of game versions on the Internet economy is still obvious and unquestionable to all.”

In addition to the signals released by the return to normalization of editions, with the explosion of the AIGC/ChatGPT trend this year, and the application launch with it, the game industry has also inspired limitless new room for imagination.

Currently, OpenAI has launched an enhanced version of GPT-4, and many tech giants have also announced that they will apply it to scenarios in game development.

Among them, Microsoft announced that the GDC2023 conference on March 22 will lead game developers to explore innovative development tools, business strategies and ecological projects through 33 agendas to accelerate game development, customer acquisition and growth.

On the domestic side, there are also technology and game companies that have vigorously begun to lay out the AI field. Baidu Wenxin's one-word cloud service will be launched on March 27. Perfect World has now applied AI-related technology to intelligent NPCs, scene modeling, AI plot, AI drawing, etc. in the game; Dentorm Network has applied AI technology such as AI image generation and AI battle games in the development of some games...

It is foreseeable that with the implementation of AIGC's application in game development and operation, it will drive changes in the long-term development and operation model of games, while greatly reducing costs and increasing efficiency and bringing about an increase in monetization capabilities.It is an important catalyst for sector valuation.

Will 2023 welcome the big year of supply and demand?

As the pace of release of domestic game versions gradually returns to normal, key projects of major manufacturers are also accelerating, and the game industry is expected to drive revenue growth through high-quality products. In addition, the core products of leading game companies have received version numbers and been launched one after another, and the supply side is driving the industry boom.

CICC believes that, benefiting from the normalization of version numbers and the recovery of supply and demand, after the game sector rose more than 40% from its low in the second half of 2022, the valuation was still lower than the average for the past five years, and the market did not revise profit expectations as the external environment improved. There may be a slight double click in the future. Specifically, leading manufacturers are fully stocked with product and version reserves. Their performance is robust, their valuations are still at the bottom, and they have a good investment cost performance ratio; small and medium-sized companies pay more attention to transactional opportunities in the product cycle.

On the other hand, AICG may open a new chapter in the industry as it pushes for a paradigm upgrade in game production.

Guojin Securities pointed out that AIGC technology and products have now been partially applied in the game industry. In the medium to long term, they have a strong effect on reducing costs and increasing the efficiency of game production and improving content quality. Currently, game versions are being distributed on a regular basis, and uncertainty on the policy side is reduced. It is expected that the product cycle will be the key driver of performance, and focus on the launch of game products.

Everbright Securities also said that recent developments in the centralized release of AIGC are beneficial to the game industry. Entertainment-based game content is highly tolerant of AIGC's potential reliability risks, and recognition for its creativity and interactivity is high. AIGC's promotion progress may exceed expectations, and the valuation of the game sector is expected to increase.

Focus on the AIGC industry chain: 1) Internet giants have accumulated deep AI technology to help strengthen their advantages & sell products to the B end; 2) AI text content creation assistance; 3) the promotion of AI applications in multi-modal content, content generation enhances productivity in film production; 4) AI marketing digital people enhance their intelligence level: recommend mango supermedia; 5) data elements in AIGC development are scarce and are in line with the main line of digital China.

edit/ruby