Event: the company issued an announcement on the evening of June 2, 2021, terminating the non-public offering of shares to major shareholder Xinxing Hanyi in 2020. At the same time, major shareholders will transfer shares to Guochuang Capital and entrust voting rights. After the completion of the transfer, the controlling shareholder of the company will be changed to Guochuang Capital, and the actual controller will change Wuhan SASAC.
Comments: state-owned assets are entrusted through bulk transactions and voting rights. After the completion of the deal, the shareholding of Xinxing Hanyi, a major shareholder, decreased from 13.73% to 11.79%, while that of Guochuang Capital rose to 1.94%. The combined voting rights of Xinxing Hanyi, Contemporary Group and Tianfeng Ruiyuan decreased from 29.97% to 0%, while the voting right of China Capital increased from 0% to 27.39%. Judging from the details of the transaction:
1) Xinxing Hanyi transferred 1.94% of its shares in the form of a block transaction, and the remaining 11.79% of the voting rights represented by the new star Hanyi entrusted to Guochuang Capital to exercise.
2) the contemporary group entrusts the voting rights corresponding to 13.66% of the equity to Guochuang Capital to exercise.
3) Tianfeng Ruiyuan gives up the voting right corresponding to its 2.58% stake.
The entry of state-owned assets will bring stability to the company and be optimistic about its long-term development. On the whole, the entry of state-owned assets ensures the stability of the company's long-term development, and state-owned assets do not rule out the subsequent increase of capital and controlling shares for the company. The actual impact will be reflected in three aspects:
1) the state-owned background contributes to the decline of the company's cost of capital (fixed increase in capital injection, loan interest rate, debt interest rate, etc.)
2) the strong background of state-owned assets will become the cornerstone of the strategic layout of the company's big sports, and the integration of resources can be expected.
3) We expect that the whole management team will remain stable and will continue to operate around the company's main sports industry in the future to ensure long-term development.
The European Cup + Asian Football Association tournament has entered the cash cycle and is optimistic about the reversal of the company's Q2 and Q3 performance. The European Cup is expected to be held from June 11 to July 11, 2021, and the related copyright distribution revenue will be recognized in Q2 and Q3 respectively. In addition, since 2021, the company's Asian Football Federation project has entered the realization period, the top 40 in Asia started on May 30, and the attention continues to rise. In addition, the AFC Champions League will start on June 20, and revenue will continue to be confirmed. the company's performance is expected to hit bottom and rebound.
Investment suggestion: we expect the company's net profit from 2021 to 2023 to be RMB 2160.252Universe, an increase of 111.2%, 16.96%, 108.17%, and 0.37, 0.43, 0.90, respectively, over the same period of last year, with a year-on-year growth rate of 111.2%, 16.96% and 108.17%. Corresponding to 2021-2023 PE is 21-18-8 times, given a "buy" rating.
Risk hint: the epidemic situation has repeated risks, and the sports boom is not as good as expected.
