Investment Rating - The report maintains a "Buy" rating for the company [4] Core Insights - The company achieved a revenue of 3.082 billion RMB in 25H1, representing a year-on-year increase of 38.8%, driven by both gaming and TapTap [1] - Gross profit reached 2.253 billion RMB, with a gross margin of 73.1%, primarily due to strong overseas performance of "Ragnarok M: Beginners Edition" [1] - The net profit attributable to shareholders was 755 million RMB, a significant year-on-year increase of 268.0%, resulting in a net profit margin of 24.5% [1] Revenue Breakdown - The gaming business generated 2.071 billion RMB in revenue for 25H1, up 39.4% year-on-year, with network game revenue contributing 1.982 billion RMB [2] - The average monthly active users (MAU) for network games increased by 19.7% year-on-year, while the average paying users (MPU) grew by 21.1% [2] - The top three revenue-generating games were "Muffin Adventure," "Heart Town," and "Ragnarok M," with "Muffin Adventure" having completed its global launch [2] TapTap Performance - TapTap's advertising revenue was 1.011 billion RMB in 25H1, reflecting a year-on-year growth of 37.6% [3] - The MAU for the Chinese version of TapTap was 43.6 million, showing a slight increase of 0.9% year-on-year [3] - The growth in revenue was attributed to increased advertiser spending, improved algorithms, and higher ad display frequency [3] Profit Forecast and Valuation - The net profit forecasts for 25-27 are revised to 1.69 billion, 2.07 billion, and 2.38 billion RMB, representing increases of 52.0%, 51.4%, and 69.6% respectively [4] - The report highlights the strong performance of new games and the effective long-term operation capabilities of the company [4] Financial Summary - The company is projected to achieve revenues of 3.389 billion RMB in 2023, growing to 8.429 billion RMB by 2027, with a compound annual growth rate of 10.9% [5] - The earnings per share (EPS) is expected to rise from -0.18 RMB in 2023 to 4.83 RMB in 2027 [5] - The return on equity (ROE) is forecasted to improve significantly, reaching 27.36% by 2027 [5]

Core Viewpoint - CICC maintains an "outperform" rating for Xindong Company (02400) and raises the target price by 14% to HKD 93.7, reflecting a valuation premium due to TapTap's monetization capabilities and future layout [1] Financial Performance - The company's 1H25 revenue increased by 39% to CNY 3.08 billion, with profit rising by 223.5% to CNY 811 million, and net profit attributable to shareholders up by 268% to CNY 755 million, aligning with CICC's expectations [2] Gaming Segment - Game revenue for 1H25 grew by 39% to CNY 2.07 billion, driven by strong performances from "Ragnarok M: Beginner Server," "Xindong Town," and "Torchlight" [3] - Future growth is anticipated from existing games, particularly with accelerated commercialization of "Xindong Town" and the overseas launch of "Ragnarok M: Beginner Server" in 2H25 [3] TapTap Platform - The platform's scarcity is highlighted, with ongoing efforts to enhance monetization potential through the PC version and mini-games, which are expected to contribute to future growth [4] - Despite MAU remaining stable year-on-year, user engagement has improved, with DAU increasing by 11% over the past 12 months [4] Advertising and Monetization - Revenue from Tap increased by 38% to CNY 1.01 billion due to upgrades in the advertising system, enhancing ad effectiveness [5] - The company is positioned uniquely in the gaming acquisition platform market, with potential for increased market share through internal upgrades and external supply enhancements [5] Future Directions - The launch of TapTap PC version and mini-games is expected to enhance multi-platform collaboration and attract more advertising budgets [6] - The TapADN platform, aimed at game developers for monetization and user growth solutions, is in its early development stage, with a potential market size in the tens of billions [6]

Core Viewpoint - The report from CICC maintains the forecast for Xindong Company (02400) with a net profit of 1.65 billion and 1.95 billion yuan for 2025 and 2026 respectively, with a target price increase of 14% to 93.7 HKD, indicating an upside potential of 16% based on the company's monetization capabilities and future layout [1]. Group 1: Financial Performance - The company's 1H25 revenue increased by 39% to 3.08 billion yuan, with profit rising by 223.5% to 811 million yuan, and net profit up by 268% to 755 million yuan, aligning with CICC's expectations [2]. - Game revenue for 1H25 also grew by 39% to 2.07 billion yuan, driven by strong performances from titles such as "Ragnarok M: Beginner's Server" and "Xindong Town" [2]. Group 2: Game Development and Future Prospects - The company is focusing on existing games with anticipated commercialization acceleration for "Xindong Town" and the overseas launch of "Ragnarok M: Beginner's Server" in the second half of 2025 [2]. - New game launches to watch include "Yise" on September 25 and "Ragnarok RO: Guardian of Eternal Love" testing at the end of the year with plans for 2026 [2]. Group 3: TapTap Platform Insights - The scarcity of the TapTap platform is highlighted, with ongoing efforts to enhance monetization potential through the PC version and mini-games, which are expected to contribute to future growth [3][5]. - The company reported a 38% increase in Tap revenue to 1.01 billion yuan, driven by an upgraded advertising system that improves ad effectiveness [4]. Group 4: Strategic Developments - The launch of TapTap PC version and mini-games in April and July respectively is expected to enhance multi-platform collaboration and attract more advertising budget increments [5]. - The TapADN platform, aimed at game developers for monetization and user growth solutions, is in its early development stage with a potential market size in the tens of billions [5].

Core Viewpoint - The company has demonstrated significant growth in its mid-2025 performance, with substantial increases in revenue, net profit, and gross profit, continuing the upward trend established after returning to profitability in 2024 [1][5]. Financial Performance - The company reported total revenue of 3.08 billion RMB for the first half of 2025, a year-on-year increase of 38.8% [7]. - Gross profit reached 2.25 billion RMB, reflecting a 50.5% increase compared to the previous year, with a gross margin improvement from 67.4% to 73.1% [6][7]. - Net profit for the period surged by 223.5% to 810.6 million RMB, with adjusted net profit increasing by 205.9% [7][8]. - The company maintained effective cost control, with sales expenses growing at 7%, significantly lower than revenue growth, while general and administrative expenses decreased by 8.9% [7][8]. Market Position and Strategy - The gaming business generated 2.07 billion RMB in revenue, with a 39.4% year-on-year growth, outperforming the overall Chinese gaming market growth of 14.08% [12]. - The average monthly active users and monthly paying users increased by 19.7% and 21.1%, respectively, indicating the effectiveness of the company's premiumization strategy [12][13]. - Key revenue drivers included successful titles such as "Ragnarok M: Beginners' Server," "Heart Town," and "Torchlight: Infinite," which contributed to a diversified product matrix [12][14][15]. Cash Flow and Capital Structure - The company generated a net cash flow of 638 million RMB from operating activities, alongside 3.18 billion RMB in cash and short-term investments, providing a solid financial foundation for future strategic initiatives [9][10]. Ecosystem Development - The TapTap platform achieved a 37.6% year-on-year revenue growth, reaching 1.01 billion RMB, showcasing the effectiveness of its community-driven model [18]. - The platform's strategic evolution includes the launch of a PC version and a mini-game platform, positioning it as a comprehensive ecosystem for game distribution and user engagement [18][19][23]. Investment Outlook - The company's improving fundamentals and positive market sentiment have led to increased institutional investment in the gaming sector, with significant allocations observed in the media sub-sector [24][25]. - The combination of policy support, consumer recovery, and ongoing game releases positions the company for accelerated value realization, making it an attractive investment opportunity [25].

Core Insights - The company's 1H25 performance aligns with expectations, showing significant revenue and profit growth, with a 39% increase in revenue to 3.08 billion yuan and a 223.5% increase in profit to 811 million yuan [1] Group 1: Financial Performance - The company's revenue for 1H25 increased by 39% to 3.08 billion yuan, meeting the forecast of at least 3.05 billion yuan [1] - Net profit attributable to shareholders rose by 268% to 755 million yuan, with adjusted net profit increasing by 235% to 796 million yuan [1] - The overall performance is consistent with the company's profit warning and analyst expectations [1] Group 2: Game Development and Trends - Game revenue for 1H25 increased by 39% to 2.07 billion yuan, driven by strong performances from titles like "Ragnarok M: Origin" and "Heart Town" [1] - Future growth is anticipated from existing games, particularly with the commercialization acceleration of "Heart Town" and the overseas launch of "Ragnarok M: Origin" [1] - New game launches to watch include "Iser," set to launch on September 25, and "Ragnarok RO: Guardians of Eternal Love," which is scheduled for testing by the end of the year [1] Group 3: TapTap Platform and User Engagement - The TapTap platform has shown a stable monthly active user count of 43.625 million, with a 1% year-on-year increase, while daily active users have increased by 11% over the past year [2] - The company is enhancing its community ecosystem by integrating more games with TapSDK, which allows for data sharing and the creation of differentiated content [2] - Revenue from Tap increased by 38% to 1.01 billion yuan, attributed to improvements in the advertising system and market positioning as a unique player in the game acquisition platform [2] Group 4: Future Outlook and Valuation - The company maintains net profit forecasts of 1.65 billion yuan and 1.95 billion yuan for 2025 and 2026, respectively [3] - The current stock price corresponds to 21 and 18 times the P/E ratio for 2025 and 2026, with a target price increase of 14% to 93.7 HKD, indicating a potential upside of 16% [3]

Core Viewpoint - The company has shown significant growth in its mid-year performance, driven by new game releases and improvements in user engagement on the TapTap platform, leading to an optimistic outlook for future growth [1][2]. Group 1: Financial Performance - In H1 2025, the company achieved revenue of 3.082 billion yuan, a year-on-year increase of 39% [1]. - Adjusted profit reached 853 million yuan, up 206% year-on-year, while net profit attributable to shareholders was 755 million yuan, reflecting a 268% increase [1]. - The gross margin improved by 6 percentage points to 73%, primarily due to the increased share of net revenue from the overseas version of "初心服" [1]. Group 2: Game Performance and Growth Drivers - Game revenue for H1 2025 was 2.1 billion yuan, also up 39% year-on-year, with a gross margin of 68% [1]. - The average monthly active users for online games reached 11.41 million, a 20% increase year-on-year, while average monthly paying users grew by 21% to 1.32 million [1]. - The game "心动小镇" has maintained player interest through content updates, ranking significantly in iOS sales charts [1]. Group 3: Future Growth Potential - The company is expected to leverage long-term operations to create more enduring games, with plans for the international launch of "伊瑟" and the upcoming release of "仙境传说RO：守护永恒的爱2" [2]. - TapTap's revenue for H1 2025 was 1.01 billion yuan, a 38% increase year-on-year, with a gross margin of 84% [2]. - The introduction of AI game recommendation tools and the expansion into PC and mini-games are anticipated to sustain high revenue growth for TapTap [2].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1][4][11] Core Views - The company reported a significant increase in revenue and profit for H1 2025, with revenue reaching 3.082 billion HKD, up 39% year-on-year, and adjusted profit at 853 million HKD, up 206% year-on-year. The net profit attributable to shareholders was 755 million HKD, reflecting a 268% increase year-on-year. This growth is attributed to the strong performance of new games and improvements in the TapTap platform [4][5][6] - The company is optimistic about the growth potential of new games and the TapTap platform, with expectations for continued revenue growth driven by upcoming game launches and enhancements in user engagement [4][5][6] Financial Summary and Valuation Metrics - For the fiscal year 2025, the company is projected to achieve a revenue of 6.573 billion HKD, with a year-on-year growth of 31.1%. The net profit is expected to be 1.710 billion HKD, reflecting a year-on-year increase of 110.8%. The gross margin is projected to be 73%, and the net margin is expected to reach 26% [7] - The company's price-to-earnings (P/E) ratio for 2025 is estimated at 21.3 times, with projections for 2026 and 2027 at 15.5 and 13.1 times, respectively [7]

Core Viewpoint - Xindong Company (02400) reported strong financial results for the first half of 2025, leading to a nearly 5% increase in stock price, reflecting positive market sentiment towards the company's performance [1] Financial Performance - The company achieved a revenue of 3.082 billion yuan, representing a year-on-year growth of 38.8% [1] - Gross profit significantly increased by 50.5% to 2.253 billion yuan, with the gross margin rising from 67.4% in the same period last year to 73.1% [1] - Profit attributable to equity holders reached 755 million yuan, marking a substantial year-on-year increase of 268% [1] - Adjusted profit attributable to equity holders was 796 million yuan, reflecting a year-on-year growth of 235.3% [1] Business Segments - The gaming segment performed strongly, generating revenue of 2.071 billion yuan, which is a 39.4% increase year-on-year [1] - The growth in gaming revenue was primarily driven by self-developed games such as "Ragnarok M: Beginning," "Xindong Town," and "Torchlight: Infinite" [1] - The TapTap platform also showed robust performance, achieving revenue of 1.011 billion yuan, a year-on-year increase of 37.6% [1]

Group 1 - The core viewpoint of the article highlights the strong financial performance of Xindong Company (02400) for the first half of 2025, with significant revenue and profit growth [1] - The company reported a revenue of 3.082 billion yuan, representing a year-on-year increase of 38.8% [1] - Gross profit surged by 50.5% to 2.253 billion yuan, with the gross margin improving from 67.4% in the same period last year to 73.1% [1] Group 2 - The profit attributable to equity holders reached 755 million yuan, marking a substantial year-on-year growth of 268% [1] - Adjusted profit attributable to equity holders was 796 million yuan, reflecting a year-on-year increase of 235.3% [1] - The gaming segment performed strongly, generating revenue of 2.071 billion yuan, up 39.4% year-on-year, driven by self-developed games such as "Ragnarok M: Beginning Server," "Xindong Town," and "Torchlight: Infinite" [1] Group 3 - The TapTap platform also showed robust performance, achieving revenue of 1.011 billion yuan, which is a year-on-year increase of 37.6% [1]

Core Insights - The company reported a strong mid-year performance for 2025, achieving a total revenue of 3.082 billion RMB, a year-on-year increase of 38.8%, and a significant profit surge with net profit reaching 811 million RMB, up 223.5% [1][10] Financial Performance - The gross profit increased by 50.5% to 2.253 billion RMB, with the gross margin rising from 67.4% to 73.1% [1][3] - The sales and marketing expenses grew by only 7.0% to 744 million RMB, indicating improved marketing efficiency [4] - Research and development expenses rose by 30.8% to 549 million RMB, reflecting ongoing investment in future product development [4] - General and administrative expenses decreased by 8.9% to 126 million RMB, primarily due to reduced share-based compensation [5] Game Business Performance - The gaming segment generated 2.071 billion RMB in revenue, a 39.4% increase, driven by self-developed games like "Ragnarok M: Beginners" and "Torchlight: Infinite" [6] - The paid game segment also saw a steady growth of 14.2%, supported by new titles contributing to the TapTap platform [6] TapTap Platform Developments - The TapTap platform achieved revenue of 1.011 billion RMB, a 37.6% increase, with a stable average monthly active user (MAU) count of 43.63 million [8] - The company is shifting its focus from "discovering" to "creating" games, with plans to enhance its PC version and introduce mini-games [7][9] - AI applications are being explored to improve platform services, including interactive game recommendations [9][10] Future Outlook - The financial health and cash flow position of the company provide a solid foundation for future growth, with a focus on expanding the TapTap platform's value and service offerings [10]