Citigroup believes that with the release of several major television dramas and popular films, the expected revenue and profit of New Classics Media in the first half of the year will reach RMB 0.95 billion and RMB 0.28 billion respectively.
According to the Smart Finance app, Citigroup released a research report stating that the first-half revenue and profit of China Lit Group (00772) is expected to exceed expectations, mainly due to the contribution of its subsidiary New Classics Media, maintaining its 'buy' rating, and target price is HKD 32.
Citigroup estimates that the first-half revenue of China Lit will increase by 18% YoY to CNY 3.86 billion, which is about 5% higher than the market's estimated CNY 3.66 billion. The gross margin is expected to expand to 52%, and the non-IFRS profit is expected to be around CNY 0.681 billion, which is higher than the market's average estimate of CNY 0.642 billion.
Citigroup believes that with the release of several major television dramas and popular films, the expected revenue and profit of New Classics Media in the first half of the year will reach RMB 0.95 billion and RMB 0.28 billion respectively. Combined with other IP revenue, the group's revenue and profits are expected to exceed expectations. Looking forward to the second half of the year, due to the decrease in the number of major dramas, the performance of New Classics Media may weaken, and the two recently released films may bring some uncertainties, while the momentum of other IP adaptations may continue.