zhongtai securities released a research report, stating that at the current stage, due to the overall sector being at a relatively low valuation level, the marginal improvement in policy is expected to drive a rebound in valuations.
According to the Futu Finance app, zhongtai securities released a research report stating that the year-on-year growth rate of domestic mobile games has shown marginal improvement, and the monthly year-on-year growth rate has a certain synchronic relationship with the A-share online gaming index. Since September of last year, the monthly scale of the domestic gaming industry has shown a downward trend, so the year-on-year data is expected to improve month by month starting from September of this year. At the current stage, due to the overall sector being at a relatively low valuation level, the marginal improvement in policy is expected to drive a rebound in valuations. zhongtai securities suggests that the gaming ETF in the sector is a very good choice. In terms of individual stock symbols, it is recommended to pay close attention to companies with more obvious marginal changes. Recommended stocks: beijing ultrapower software (300002.SZ), kingnet network technology (002517.SZ), shanghai yaoji technology (002605.SZ), g-bits network technology (603444.SH).
Zhongtai Securities' main points are as follows:
The month-on-month growth rate of the industry has reached a bottom and is rebounding, and the sector valuations are at a low level. The year-on-year growth rate of domestic mobile games has shown marginal improvement, and the monthly year-on-year growth rate has a certain synchronic relationship with the A-share online gaming index. Since September of last year, the monthly scale of the domestic gaming industry has shown a downward trend, so the year-on-year data is expected to improve month by month starting from September of this year. Additionally, the current P/E ratio (TTM) of the A-share online gaming index is around 19.6x, which is at a low level in the past 3 years.
The performance of the gaming sector in the fourth quarter of last year was relatively low, and it is expected to improve year-on-year this year. The performance of A-share gaming companies in Q4 of 2023 was weak, with a total quarterly non-recurring performance of only 0.62 billion, a significant decline compared to 3.09 billion in Q3 of 2023. This is mainly due to the dual impact of personnel optimization and industry downturn. This year, under the backdrop of overall cost reduction and efficiency improvement, the performance in Q4 of 2024 is expected to improve significantly on a low base.
"Black Myth: Wukong" validates the logic of cultural expansion in the gaming industry and shows marginal improvement in policy. Since the launch of "Black Myth: Wukong", global sales have exceeded tens of millions sets. The media, such as "Xinhua News Agency", "People's Daily", and "CCTV News", have repeatedly mentioned its positive role in promoting traditional culture. The emergence of "Black Myth: Wukong" has not only improved the image of games in the public's perception, but also made contributions to the expansion of traditional culture in the international market. The latest batch of licenses issued in August reached 117, which is a new record high for a single month in the past two years. The policy environment continues to improve.
Risk Warning: Risks of product delays in launching; Risks of product performance falling short of expectations; Risks of industry policies and regulations; Risks related to forecasting assumptions and data statistics.