CCTV's listing platform has landed in the capital market for more than 20 years.
China Television Media is jointly sponsored by five legal persons, namely, Wuxi Taihu Film and Television City of CCTV, China International Television Corporation, CLP High-tech TV Development Co., Ltd., Beijing Future Advertising and Beijing screen car Leasing. It is the first batch of state-owned cultural media enterprises to test the water capital market in China, and it was listed in 1997. The actual controller of the company is the former CCTV (now merged into the CCTV console). China Television Media is mainly engaged in advertising, film and television, and tourism, of which advertising accounts for the highest proportion of 48% (18 years). The company's operating performance began to pick up in 17 years and continued to pick up in 2018, with revenue of 811 million, an increase of 13% over the same period last year, and a net profit of 115 million yuan, an increase of 39% over the same period last year. 19Q1 achieved revenue of 209 million yuan, an increase of 34.09% over the same period last year, and its net profit was 35.79 million yuan, an increase of 47.01% over the same period last year.
Take advantage of CCTV resources to carry out business, advertising, film and television, tourism three major sectors go hand in hand.
On the basis of special resources, China Television Media Advertising Business has contracted the full channel advertising resources of CCTV Science and Education Channel and some new media advertising resources, focusing on cultivating the four major industries of "liquor, automobile, big health and urban tourism". In terms of film and television business, the subsidiary China Television Northern Ultra High definition (UHD) is the first enterprise in China to enter the field of HDTV production. The newly built UHD technology guarantee system has successfully helped CCTV 4K Ultra HD Channel launch, which can meet the full business needs of high-end 4K programs. After the release of the national UHD plan, it is expected to open up a new industry space. The company's tourism business revolves around Wuxi and Nanhai branches as the main body, and its revenue and gross profit have increased steadily in the past 20 years.
Relying on the rich assets of CCTV, there is room for business development and coordination.
The actual controller of the company is the former CCTV, which has been merged into the Central Radio Station since 2018 and is an institution directly under the State Council, under the leadership of the propaganda Department of the Central Committee of the Communist Party of China. China International Television Corporation, one of the sponsors of China Television Media, is not only a large state-owned enterprise fully invested by CCTV, but also the market main body of the global layout, all-media communication and all-industry chain operation of CCTV. It has more than 50 subsidiaries, including sports, film and television, animation and other content areas, as well as media technology, market research and so on.
Investment suggestion: we believe that CCTV Media, as a listed platform under CCTV, has the advantage of resources in the development of its main business and technical strength in the field of ultra-high definition. Facing 19 years, the company highlights the general trend of the development of media convergence. It is expected to create a new situation of industrial management under the new trend, while focusing on a larger territory, the company's shareholders are rich in assets, and the development of business synergy and innovation under the wave of financial media is worth looking forward to. We estimate that the company's net profit from 2019 to 2021 will be 157 million / 189 million / 218 million yuan respectively, an increase of 36.7%, 20.6%, 15.4% over the same period last year, and the corresponding PE will be 34.1x/28.3x/24.5x, respectively. In the future, there is room for increased profits in special resource advertising and film and television services in the context of arbitration compensation and financial media development. Combined with the state-owned media platforms people's Daily online (2019PE 58.57x) and Xinhua Network (2019PE 29.23x), taking into account the background of CCTV shareholders and the performance space under the trend of financial media, we believe that the reasonable valuation range of CCTV Media is 19-year 45x-55x, corresponding to the market capitalization of 7.065 billion-8.635 billion, and the corresponding price zone is 17.76 yuan / share-21.76 yuan / share, covering the "buy" rating for the first time.
Risk tips: the coordination of resources between the company and shareholders is not up to expectations, the impact of macroeconomic on advertising, the impact of new media and new technology competition, film and television project production and sales are not up to expectations.
