Main points of investment:
Industry profile: changes in times and communication promote content marketing. We predict that the overall market size of the advertising industry will be about 200 billion yuan, and the growth rate has slowed down in recent years. Due to the subdivision of the advertising audience and the diversification of channels, consumers have changed from passive recipients of information to active participants, one-way communication mode can not effectively reach the target group, and hard advertisements such as print broadcasting are difficult to attract attention. The advertising market is constantly transforming to advertising internalization, and all advertisements need to be combined with content in order to better carry out marketing. the traditional hard and broad growth trend is stable, and there will be more room for the development of content-based marketing in the future. As variety shows are easier to attract investment and are more in line with content marketing and variety shows, they have greater potential for development.
Main business split: traditional TV advertising + variety show production marketing + special marketing services. Gravitation Media's core business is divided into three parts, traditional TV advertising, variety show production and marketing and special marketing services. This year, traditional TV advertising revenue is expected to be the same as variety show revenue. And revenue will reach about 20 billion to 2.5 billion. The company expects to produce 8-10 variety shows (including Internet students' shows) this year. "seeing your Voice", which is broadcast on March 27 in Jiangsu Satellite TV's Sunday prime time, is the company's core product in the first quarter, with an initial audience rating of 0.98, ranking eighth in the country. The company invested 54 million yuan in the program, accounting for 60%. The copyright of the program was purchased from the Korean program "I Can See Your Voice". It is a new concept music reasoning program launched by the South Korean CJ Group. It has high ratings in South Korea and has been produced for the second season, ranking first in the ratings in the same period of time.
The future layout of the company: one body and two wings, coordinated development. The strategic planning of the company's business development is "one body and two wings", that is, centering on the brand building and communication needs of advertisers, making full use of its accumulated advantages, under the background of the country speeding up the development of the cultural industry, expand and strengthen the traditional media agency business, give priority to the development of content industry, and strategically develop digital industry. At present, as an "integrated" media agent, the revenue accounts for about 95% of the company's total income. Although the gross profit margin of the media agency business is low, it is an important source of the company's flow. In terms of the content industry, the company is mainly laid out in the field of variety shows, and the recently launched "seeing your Voice" has a good audience rating. In terms of digital media, due to the high technical threshold, the company is prepared to introduce a more mature team in the future to complete the layout of the plate.
The core competitiveness of the company. (1) the company has a mature and stable team, and many of the team members have served in the company for more than ten years. People in the advertising industry often move frequently, and the company's stable team can ensure lasting and effective cooperation with customers. (2) with the advantages of strategic research and resource integration, the company can integrate online and offline resources according to customers' marketing strategies and delivery needs, so as to optimize the communication effect. (3) the cooperative relationship with the media is good, and the company has branches all over the country and maintains a long-term and stable cooperative relationship with CCTV and local satellite TV stations. (4) the content layout of the company's variety show is better.
Profit forecast: we expect the EPS of the company from 2016 to 2018 to be 0.48,0.76 and 1.13 yuan respectively. The company's closing price on April 29 was 44.98 yuan, corresponding to the 2016-2018 PE of 94 times, 59 times and 40 times. As the company is in the stage of business transformation, the layout effect in the fields of variety show production and content marketing still needs to be observed, and there are still many uncertain factors, so the company will not be rated for the time being.
Risk hint: advertising business does not meet expectations, policy risk, fierce market competition, systemic risk.
