Key points of investment:
Beijing Culture is a leading company in the domestic film and television entertainment industry
Beijing Culture is a leading company in the domestic film and television entertainment industry. After 2013, it gradually developed into a full-industry chain cultural group covering movies, TV series, online dramas, artist brokerage, variety shows, new media, and tourism culture.
Film business: First-class resources in the industry, which is expected to continue to shine, the company's management team has been deeply involved in the film and television industry for many years. The core senior management Song Ge, Du Yang, Lou Xiaoxi, and Wang Jinghua all have rich experience and industry resources in the industry. They have a unique vision for investing in high-quality projects and strong project control capabilities, which is the core competitiveness of the company's film and television business.
TV series business: strong comprehensive strength, steady performance
The company's TV drama business is mainly developed by the subsidiary Century Partner, which is supported by artists belonging to Zhejiang Xinghe. Among them, the drama “Kyushu: Sea Life in the Sea”, produced in 2017, performed excellently: the highest number of single episodes was 570 million, and the highest number of daily broadcasts was 240 million. At present, the company has sufficient reserves of TV series and online drama projects, and has basically decided to set up more than 20 projects, making this business capable of continuous and steady operation.
Artist agency business: luxury contract lineup
The company's artist agency sector mainly focuses on a full range of artist agents, and has many powerful artists under its umbrella:
Lu Yi, Guo Jingfei, Ke Lan, Li Naiwen, Li Nian, Yin Xiaotian, Zhu Yuchen, Li Zonghan, etc., as well as famous directors: Shen Yan, Liu Haibo, Guo Fan, Pan Shuwu, etc. With a unique and keen perspective, the company continuously explores various talents in the entertainment industry, cultivates a large number of outstanding actors, and injects fresh blood into the company's development.
Profit forecasts and investment advice
We think the company's absolute strength in production, promotion, investment, and artist agency business is outstanding. Judging from the specific investment logic, the company's film business has a strong reserve lineup and is expected to continue to benefit over the next three years. Furthermore, the company's TV drama business and artist agency business are also expected to remain stable. We covered the company for the first time and gave the company an investment rating of “increasing holdings”. The company's 2019-2021 EPS is expected to be 0.59, 0.66, and 0.75 yuan/share, respectively. Investors are advised to keep an eye on it.
Risk warning: Market policy risks, sluggish sentiment in the film market, movie box office revenue falls short of expectations, market competition continues to intensify, and risk of staff loss.
