This report is read as follows:

Through the deep layout of blind box IP business, the company is expected to benefit from the rapid development of the blind box industry and the dividend of strong spending power that Generation Z has gradually become the main consumer.

Main points of investment:

Maintain the target price of 75.48 yuan and maintain the overweight rating. Through the in-depth layout of the blind box business, the company is expected to fully benefit from the rapid development of the blind box industry and the strong spending power dividend that Generation Z has gradually become the main consumer. Maintain 2020-2022 EPS1.49/2.44/3.87 yuan, maintain the target price of 75.48 yuan, maintain the overweight rating.

Event: the company issued a non-public offering plan, the number of non-public offering shares does not exceed 37.8 million shares (accounting for 30% of the company's total share capital of 126 million shares before the issuance), and the total amount of funds to be raised does not exceed 740 million yuan. The fund-raising plan is 157 million yuan for the production expansion project of automatic laser processing equipment and supporting services, 85 million yuan for the flexible intelligent manufacturing plant project of IP derivatives, 470 million yuan for the new retail promotion project of IP derivatives, and 28 million yuan for the construction of blockchain application R & D center based on IP derivatives.

Refinancing strengthens the layout of blind-box IP industry chain. On the one hand, the capital increase is expected to improve the production capacity of laser processing equipment, enhance the supporting service capacity and technology of laser processing, improve product quality and market competitiveness, and strengthen the comprehensive ability of laser automatic processing services of the company. On the other hand, around IP derivatives, establish a three-dimensional system of manufacturing, promotion and research and development, improve the ability of rapid response to orders, achieve intelligent manufacturing of IP derivatives, and form an integrated sales layout of various channels, so as to enhance the market competitiveness of the company.

Catalyst: blind box industry consumer main body "Z era" consumption capacity rise, live broadcast industry rapid development, blind box second-hand market rapid development.

Risk hints: policy regulatory risks, IP introduction and traffic attraction are not up to expectations