Futu News, May 11, Bilibili Inc. opened today in a straight line dive, once fell nearly 8% to HK $725. It is worth noting that Bilibili Inc. 's recent trend has been quite weak, with its share price falling for nine consecutive trading days since it reached an all-time high at the end of April, and its market capitalization has lost nearly 25 per cent from its peak.

According to the official website, Bilibili Inc. will announce the results for the first quarter ending March 31, 2021 on May 13. What indicators do investors need to focus on for this performance? How will Bilibili Inc. 's share price perform? Can Bilibili Inc. sweep away the recent haze and hand over a satisfactory answer paper?

The following is the expectations and analysis of the major brokerages sorted out by Futu Information for Bilibili Inc. 's quarterly report.

Bloomberg expects

According to consensus expectations from Bloomberg analysts, Bilibili Inc. 's Q1 revenue is about 3.78 billion yuan, with an adjusted net loss of about 800m yuan.

In terms of rating and target price, 38 analysts on Bloomberg held a "buy" opinion on Bilibili Inc., accounting for about 97.4% of the total, one analyst gave a "hold" rating, and no analyst gave a selling rating.

In addition, Bilibili Inc. 's 12-month average target price is $155.4, 64% higher than the latest closing price of $94.64.

Analyst point of view

The following are the latest ratings and target prices of Bilibili Inc. by major brokerages:

CICC: steady growth of users and looking forward to the performance of new games in the second half of the yearThe target price is reduced by 7% to $131.

• Revenue is expected to grow by 62% in the first quarter of 2021 compared with the same period last year.

We expect Bilibili Inc. 's MAU in the first quarter of 2021 to be 214 million, an increase of 12 million from the previous quarter and a 24% year-on-year increase. We expect revenue for the first quarter to be 3.75 billion yuan, in line with the company's previous guidelines of 37-3.8 billion yuan, an increase of 62% over the same period last year, down 2% from the previous month.

• Pay attention to the main points

The company's MAU is expected to grow steadily in the first quarter of 2021, and its revenue is in line with previous guidelines.According to Questmobile data, Bilibili Inc. 's average MAU increased by 15.58 million to 145 million in the first quarter of 2021 compared with the previous quarter. We estimate that the company's MAU in the first quarter of 2021 was 214 million, an increase of 12 million (6%) from the previous quarter, and a year-on-year increase of 24%, mainly due to the company's continued customer delivery and brand marketing.We expect revenue in the first quarter to be 3.75 billion yuan, an increase of 62% over the same period last year, mainly driven by advertising and value-added services.We expect advertising and value-added services revenue to grow by 152% and 81% respectively in the first quarter compared with the same period last year. Advertising revenue is mainly driven by refined operations to improve efficiency and unit price.

It is expected that due to the impact of the launch time of new games, the growth rate of game revenue for the whole year will be low before and high after.We expect game revenue to grow by 2% and 1% respectively in the first and second quarters of 2021 compared with the same period last year, mainly due to the late launch of core new games, and the steady or declining period of old games such as Destiny: Crown assignment and Princess Link. The blockbuster game "Kangong Riding Crown Sword" was launched on April 27 and has been in the top 10 of the iOS bestseller list for ten consecutive days. In addition, "Mobile War Ji" will be launched on May 25, and "Sword realm" is expected to be tested in mid-June.Therefore, we expect that Xinyou's revenue contribution in the second half of the year will be very significant, and the annual game revenue is expected to grow by 25% year-on-year to 6 billion yuan.In addition, with Bilibili Inc. 's active investment layout in game IP, production and distribution, we expect him to have closer cooperation with the TapTap platform in the future to consolidate the position of the game industry chain and feed the game content ecology in the platform.

It is expected that the company will continue to receive customers for marketing, strengthen the ecological construction of content, and put pressure on short-term profit margins.We expect the gross profit margin in the first quarter to be basically flat at 24.4%; the absolute amount of marketing investment is expected to be basically the same as the previous quarter; in addition, due to the rapid expansion of personnel, the operating expenses rate of the other two items is expected to reach 26%, the operating profit margin is expected to reach-30.1%, and the 6.6ppt is reduced. In addition, due to continued content ecological construction and operational investment, we expect the gross profit margin for the whole year to be lower than market expectations, reaching 25.6%, an increase of 1.9ppt over the same period last year, and an adjusted net profit margin of-22.6% for the whole year, reducing 1.1ppt over the same period last year.

• Valuation and suggestion

Based on long-term user growth and commercialization spaceWe maintain outperforming industry ratings and target market capitalization.Due to the dilution of the increase in the number of shares, it will be based on the segment plus total valuationThe target price is reduced by 7% to $131.Corresponding to 12.3x 2022 PSThere is 28.8% upside compared with the current share price.Bilibili Inc. is currently trading at 9.5x 2022 PS.

CITIC: users continue to expand and keep buying, with a target price of US $182

• It is expected that the performance of Q1 company is expected to reach the upper limit of the previous guidelines or slightly exceed the guidelines.
  

We expect 2021Q1's performance to reach or slightly exceed the previous guidance, MAU is expected to reach 224 million (yoy+30%), and the company's value-added services, advertising and e-commerce businesses are all expected to more than double. At the same time, we expect the company's gaming and advertising business to maintain rapid growth throughout the year, raising its revenue forecast for the full year.We believe that the company is a scarce core asset of the Internet and are optimistic about the growth momentum and commercialization potential of the company as a young generation of pan-entertainment content community.. We continue to recommend Bilibili Inc. to maintain the "buy" rating.

• Pay attention to the main points

The game business 2021Q1 is expected to remain stable and the reserve of high-quality Pipeline is adequate.The company does not have a large number of new games online in the first quarter, and the overall performance of the stock game is sound. We estimate that the company's 2021Q1 will achieve 1.151 billion yuan in game revenue, which is the same as the same period last year.

Pipeline, 1) the only generation: Bilibili Inc. has won the version number of more than 10 single-generation games, among which Princess Canterbury and the Knight was officially launched on April 28, and the players responded enthusiastically after it was launched. As of April 30, 2021, the game Bilibili Inc. ranked first on the IOS free list with a score of 8.1. In addition, Bilibili Inc. 's only generation of IP adapted mobile game "Mobile Battle Ji Fusion" is expected to be tested on May 25, which is expected to drive the growth of game revenue for the whole year. 2) intermodal transport: Bilibili Inc. is an important channel for the distribution of young games in China. In 2021, the company will continue to cooperate with head game publishers to transport popular mobile games such as NetEase, Inc's "forget Sichuan Fenghualu". And is expected to transport popular games including NetEase, Inc's "Harry Potter" mobile games and Tencent's "League of Legends" mobile games.

2021Q1's VAS revenue benefits from the continued expansion of OGV content and the rapid growth of live broadcast business.We expect the company's 2021Q1 to achieve VAS revenue of 1.706 billion yuan (yoy+115%). 2021Q1 maintains excellent results in superior animation and documentary categories, launching high-quality animation content such as "long Sword Fengyun" and "D5 team II". According to the data disclosed at the launch of Bilibili Inc. 's animation works from 2020 to 2021, Bilibili Inc. has a reserve of more than 30 Guochuang animation works. In 2020, paid member orders from Guochuang content increased by 450% compared with the same period last year, making it the most accessible content category in OGV. We believe that with the continuous expansion of Bilibili Inc. 's users and the continuous reserve of high-quality content, its VAS and live broadcast business still has a lot of room for growth.

The head of 2021Q1 advertising business benefited from the accelerated entry of advertisers and the high growth of e-commerce business.We expect 2021Q1 to achieve advertising revenue of 643 million yuan (yoy+200%) and e-commerce and other businesses to achieve revenue of 424 million yuan (yoy+170%). In terms of advertising business, with the high-quality growth of user values and the rapid development of China's emerging consumer brands, 21Q1 has started head companies such as Meituan, Tencent, China Unicom to settle in Bilibili Inc. one after another. In addition, high-end luxury brands such as LVMH and Gucci have also set up enterprise accounts or launched brands in Bilibili Inc.. Bilibili Inc. 's advertising business is expected to continue to achieve high growth. According to the company's 20Q4 performance call, the company will not increase the advertising loading rate for the time being in 2021 and will keep it at a low level of about 5%, in order to promote the healthy development of advertising commercialization business. E-commerce and other business aspects. In the advantageous field of ACG derivatives, Bilibili Inc. adopts a proprietary model. We expect that as SKU increases, business revenue will continue to grow and is optimistic about its continued commercialization potential in the future.

• Valuation and suggestion

We believe that the company is a scarce core asset of the Internet, and the number of users is expected to continue to grow at a high speed. From the perspective of the company's long-term market capitalization space, we give the company a target of MAU3.5 billion, and the target single MAU is worth US $200,000,000, corresponding to the company's target market capitalization of US $70 billion, equivalent to the target price of US $182.00 / ADS. As advertising, membership and live broadcast businesses continue to expand, commercialization still has a lot of room for improvement, maintaining the "buy" rating.