Incident: The company disclosed its 2013 performance report, with revenue of 1,672 million yuan and net profit of 313 million yuan. The year-on-year changes were -11.1% and 13.72%, in line with expectations. We have different views with the market: we think we can focus on two highlights of Guangdong media in the near future: (1) Yuncai.com has entered the final testing period, professional information analysis capabilities build product barriers, and is expected to achieve the first batch of connections with millions of readers of “Soccer Lottery Winner”. The customer base is huge (2) the Champs-Elysées is expected to successfully merge in 2014. The LED screen rate is advanced into the “new screen interaction” era, and performance is strong. According to performance promises, EPS increased by 0.08 yuan and 0.1 yuan respectively; we think 2014 will be the year of transformation of Guangdong media, and many new and old media have expanded their business. work. Although the relevant business did not contribute much to profit within 1-2 years, as long as the transformation process meets expectations, it is only a matter of time before the company establishes a comprehensive media group integrating distribution, print advertising, and new media. We are firmly optimistic about the Cantonese media and remain “highly recommended.” Key investment points: The revenue of traditional paper media has declined markedly, and open source savings support profit expansion. Due to the decline in macroeconomic growth and the impact of the new media business, the company's revenue fell -11% in 2013, which is comparable to the contraction of the industry. However, due to open source and cost savings in the new media business, the company's annual net profit reached 313 million yuan, a year-on-year growth rate of 13.72%, which is basically the same as last year. Advances in new media have accelerated the sports lottery app into the final testing period, and we look forward to enjoying the World Cup feast to the fullest: (1) The popular teams in this year's World Cup are all in the dead group. The enthusiasm for soccer will further promote football lottery growth. It is expected that the growth rate of the quiz lottery will exceed the level of 102% in 2010; (2) Relying on the millions of loyal readers of “Soccer News”, it is expected that the first batch of lottery fans will have a huge customer base. Assuming that 20% of readers successfully connect, buy lottery tickets for 100 yuan a week, and return them according to the 7% lottery revenue ratio, the company's gross profit can reach 72.8 million yuan, and the business prospects are promising; (3) The “Soccer News” professional information team is building the core competitiveness of the platform. The Champs-Elysées has entered the era of “human-screen interaction”, and new media displays have increased the space for publication prices. Compared to ordinary large outdoor LED screens, in addition to video dynamic display, Champs Elysées perfectly integrates “large outdoor LED screen+network technology+mobile internet technology” in the innovative application process. By scanning the QR code on the large LED screen, you can directly enter the brand's official website and obtain product and promotional information, making the media audience more closely related to the LED screen, creating a “new era of network screen interaction.” The large outdoor screen location of the Champs-Elysées is excellent, and the publication rate is among the highest in the industry. According to estimates, every 0.1 yuan increase in publication price will contribute 7% to the Champs-Elysées. According to the gamble agreement at the time of mergers and acquisitions, Champs Elysées's profit for the next three years will not be less than 56.83 million yuan, 68.7 million yuan, and 81.56 million yuan, with an average growth rate of 20%. Considering the integration of the resources of the two companies after the merger and acquisition and the incentive mechanism for implementation, we believe that there is a high possibility that the performance will be completed. Stock locking time is poor, and there is still room for support in stock prices. The listed company completed the restructuring work in 2012. After the transaction was completed, the majority shareholders' interests were promised not to be traded or transferred for 36 months until June 19, 2015. Therefore, during this period, although the stock prices of Guangdong media have risen a lot, the majority shareholders will not reduce their holdings on a large scale due to limited shares, which is beneficial to the company's stock price. Profit forecast and valuation: Assuming that Guangdong Media successfully completed the Champs-Elysées merger and acquisition in 2014 and began merging in the second half of the year, considering that the share capital increased to 725 million shares, the acquisition of Champs-Elysées and Guangdong Media would increase EPS by 0.08 yuan and 0.1 yuan respectively in 14-15. We expect the company to prepare for the EPS exam in 14-15 to be 0.49 and 0.56 yuan respectively, corresponding to 43 and 37 times PE. The target price is expected to be 26 yuan, which continues to be given a “highly recommended” rating. Risk warning: The performance of the M&A target did not meet expectations, and subsequent integration work was poor; community newspaper construction work fell short of expectations, local advertising revenue declined sharply; progress in the new media business fell short of expectations, etc.