Announcement event: the company intends to issue no more than 40000 million shares to seven specific targets at an issue price of 6.20 yuan per share (not less than 6.18 yuan per share). The funds raised will be mainly used to expand new media and big data business.
Home Smart Cloud Terminal has great business value: value-added services, big data analysis. Smart family is the next massive market with trillion market space, and the company's products have the dual attributes of "smart TV" and "smart router" that compete for the focus at the entrance of the living room nowadays. Therefore, we think that it can at least share the following potential value: (1) video advertising of value-added services: video advertising is the earliest profit model that can be realized, and the market size is expected to reach 19 billion yuan / year in the future.
(2) third-party application distribution of value-added services: video games may be the first third-party applications to land because of their strong cashability. Compared with the development of mobile games, it is expected that the market size will exceed 10 billion yuan / year, and as the market matures, the distribution platform will be the most concentrated part of the industry chain profits, and the company's products can easily enjoy the platform advantage. (3) big data analysis: home smart cloud terminal has the attribute of intelligent router, and its essential value lies in the bottom entrance of data flow. The secondary mining of these data by big data technology can create great commercial value. According to Sadie's forecast, the market size of big data in China will exceed 10 billion yuan per year in 2016, and the family market will play an important role in the future.
The company already has the competitive advantage of "climate, geography and people": (1) Weather: national policy is good. Triple play and network information security have risen to the national strategic level. The company's product is an intelligent terminal device with the function of a new generation of network TV. The application of the leading information security encryption technology of the Institute of Computing of the Chinese Academy of Sciences can meet the manageable and controllable content of the intelligent TV terminal integrated by the State Administration of Radio, Film and Television. (2) location: the initial promotion of the product landed in Shandong and Anhui.
Partner Shandong New Media has a number of triple play related industry qualifications, can provide rich and high-quality video content resources. In addition, the company has reached an agreement with Anguang Network to replace 5 million cable TV set-top boxes in Anhui Province by the end of 2016. (3) Renhe: join hands with the national information security team, the Computing Institute of the Chinese Academy of Sciences. The company's products will apply the information security and big data technology developed by the Institute of Computing of the Chinese Academy of Sciences. At the same time, with the deep national background of the Institute of Computing of the Chinese Academy of Sciences, the company can improve its dialogue status with SARFT and other government agencies in product promotion.
With the help of the distribution of operators to recover the cost of equipment, relying on value-added services is expected to be considerable. (1) the company bundles the terminal products with broadband charges through radio and television / telecom operators, and makes a commission on the equipment rental fee. We expect that the company will be able to recover the full cost of the equipment in about 3 years. (2) through cooperation with operators, the company shares the revenue of value-added services such as video advertising and third-party application distribution. We expect these two businesses to contribute a total of 2.7,6.2 and 1.02 billion yuan to the company's revenue in 2014, 2015 and 2016.
Give a "buy" rating for the first time. Considering the dilution effect of SEOs, the EPS for the next three years is 0.02 + 0.17 + 0.36, and the corresponding PE for 14-16 years is 455-54-25. The company has reached cooperation agreements with radio and television in Shandong and Anhui, product promotion channels are guaranteed, and we are given a "buy" rating for the first time.