The reserve for subsequent films is rich and diverse
The Zhitong Finance App learned that CICC released a research report stating that considering the uncertainty of Ning Meng Film and Television's (09857) content launch and cost rigidity, the 2023/2024 non-IFRS net profit was reduced by 25.5%/44.9% to 2.41/300 million yuan. Maintaining an outperforming industry rating, taking into account the decline in profit forecasts and the upward shift in the industry valuation center, the target price was lowered by 24.2% to HK$10, corresponding 13.5/10.9 times 2023/2024 non-IFRS P/E, with potential for 27.1% upward space. The current price is 10.6/8.6 times 2023/2024 Non-IFRS P/E.
Company's recent situation:
Recently, Ning Meng's film and television drama “One Thought of Guanshan” was a hit on iQiyi. According to data from Yunhe, its highest broadcast market share in a single day reached 9.9%, once again verifying Ning Meng's ability to produce premium movies and TV series. The company also recently released the 2024 drama list, focusing on the five major tracks of “reality”, “suspense the world”, “urban romance”, “costume production”, and “innovation ∞”, further expanding the categories.
▍ The main views of CICC are as follows:
The content reserve is rich, and various tracks go hand in hand.
In 2023, the company's three dramas, “Just Love,” “Asking Your Heart,” and “One Thought,” were broadcast one after another, but the number was slightly lower than previously anticipated. Looking ahead to 2024, “Urban Romance”, “You Have Today Too”, and “Half-Mature Men and Women” all beat out in August 2023. In 2024, the company plans to promote the “Big Costume Festival” category “Return at Midnight,” the “Suspense World Situation” category, “Crime Hunting Guide 2,” and the suspense drama “Call at the Entrance.”
The company has plenty of reserves for dramas with various themes. The company expects “A Thousand Miles of Moon”, “A Thousand Miles of Moon”, “A Dream”, “Confrontation”, “Little Three Homes”, “One Thought of Jiangnan”, “Thirty Thoughts 2”, and “Today Is the Sun and Rain” also expected to launch in 2024. The company plans to increase from the previous production of 100 to 150 episodes per year to an increase of 200 episodes per year to 200 episodes per year in the next 3 years.
Ning Meng has outstanding production capabilities for film and television series. The series planning and layout are perfect, and the content is expected to continue to be innovated and iterated.
Continuing to push the series overseas, the first teaser for the Thai version of “Just Thirty” has been released.
On December 7, Ning Meng International also unveiled 16 films from the 2024 international film list at the Singapore Asian Television Forum Festival. At the same time, the cast of the Thai version of “Just Thirty” was announced for the first time, and the first trailer for the Thai version of “Just Thirty” was released. The company also plans to revise the Thai version of “The Hunt for Crime”, which is currently under development. Continued attention is recommended. Ning Meng's movies and TV series have the potential to go overseas.
Extend the advantages of content production and explore new growth points for short dramas.
According to the company's announcement, at the beginning of 2023, the company's short drama “29” led the spring festival of short dramas. The original video was viewed more than 800 million times on the Douyin platform, with an average total of over 40 million views, and a total of 1.45 billion views on related topics across the site. Immediately after the second season of “29” went live, it was on the TOP1 list of the most popular short dramas; “Behind the Traffic” reached 170 million viewers, and the highest number of single episode views exceeded 280 million times, and occupied the TOP1 of the most popular short dramas for 4 consecutive weeks.
Looking ahead to 2024, it is expected that the company may launch miniseries with more themes. It is recommended to pay attention to the increase in production capacity for miniseries in the future.
risks
Content launch time and performance are uncertain, industry competition intensifies, and liquidity risks.