Core ideas:
First, the company is a domestic development and operation integrated online game enterprise, the main business is based on independent research and development of engine technology to develop large-scale multiplayer online games, and adopts the combination of independent operation, authorized operation and joint operation. operate independently developed online games. Before this issue, the company's total share capital is 75 million shares, of which Liu Heguo holds 43.84 million shares (58.5%), which are the company's controlling shareholders and actual controllers; this time, the proposed issue of 25 million shares, accounting for 25.0% of the total share capital after the issuance, the total share capital of the company will become 100 million shares, and the major shareholders will hold 43.8% of the shares after the completion of the issue.
Second, the company has formed an integrated management model of development and operation, which takes the general engine as the technical platform, the project team as the development platform and the parent company as the operation platform. The company's products are mainly PC-end games, and cover mobile games, page games and other types, there are a number of products in formal operation or in the testing stage; the company operates mainly in domestic independent operation, and with domestic and foreign operators for joint operation or authorized operation, there are dozens of cooperative operators. At present, the company's main game products include large-scale PC games "Expedition OL", "Longwu" and "invincible Legend", among which "Expedition OL" and "Longwu" have large revenue and user scale. The company continues to invest in the development of new PC games, and there are currently five PC games under development; at the same time, the company is actively exploring new product areas, setting up a number of project teams to engage in the development of mobile games and page games, 3 mobile games and 1 page games are in the development stage. In July 2016, the PC game "the Legend of Invincible" launched its internal test, while the PC game "Warhammer" and "Ghost Valley unparalleled" launched its first test in August.
Third, the growth of the company's revenue and profits is stable. Total income: 272 million, 360 million (+ 32.2%), 370 million (+ 2.7%) and 191 million (- 0.3%), respectively, from 2013 to 2015 and the first half of 2016; net profit attributable to the parent company: 127 million, 158 million (+ 24.4%), 172 million (+ 8.8%) and 089 million (- 11.4%), respectively. Gross profit margin: 90.9%, 91.3%, 92.6% and 92.3% from 2013 to 2015 and the first half of 2016, respectively. The net interest rates belonging to the parent company from 2013 to 2015 and the first half of 2016 were 46.5%, 43.8%, 46.4% and 46.4%, respectively.
Fourth, profit forecast and valuation: the net profit of the forecast company from 2016 to 2018 is 200 million (+ 16%), 260 million (+ 30%) and 330 million (+ 29%) respectively, corresponding to 1.99,2.58 and 3.32 yuan of EPS in 16-18 years, and the current price of 58.64 yuan corresponds to 29 times, 23 times and 18 times of PE in 16-18 years.
Risk hints: dependence on risk for some products and merchantability risk of new products
