Investment Rating - The industry rating is "Recommended" indicating a positive outlook for the sector [4]. Core Insights & Investment Recommendations - The report highlights the upcoming deadline for tariff negotiations, which may increase external trade uncertainties. However, there remains a cautious optimism regarding the substantive implementation of existing trade agreements [2][23]. - The film box office for the first half of 2025 reached 29.231 billion yuan, marking a 22.91% year-on-year increase and the best performance in six years. The top five films were all domestic productions, showcasing the resilience of domestic entertainment consumption and the strengthening of the content ecosystem [2][24]. - The report suggests focusing on investment opportunities in the following areas: 1) Hong Kong internet leaders, 2) the gaming industry, and 3) the film and cultural tourism sector, driven by consumption policies that promote recovery [3][24]. Summary by Sections Market Overview - In the week of June 30 to July 4, 2025, the Shanghai Composite Index rose by 1.4%, while the SW Media Index increased by 2.7%, ranking 6th among 31 industries [10][16]. Sub-industry Data Film Industry - The top three films for the week were "Jurassic World: Rebirth" with a box office of 18.175 million yuan, "Detective Conan: The Lone Eye's Residue" with 8.402 million yuan, and "F1: Speeding" with 7.569 million yuan [25][26]. Gaming Industry - The top three iOS games were "Honor of Kings," "Peacekeeper Elite," and "Delta Force," while the top three Android games were "Heartbeat Town," "Honkai: Star Rail," and "Staff Sword Legend" [25][26]. TV Series - The top three TV series based on broadcast index were "In the Name of the Law," "Splendid Blossoms," and "Book Roll Dream" [28][29]. Variety Shows & Animation - The top variety show was "Ha Ha Ha Ha Season 5," followed by "Run, Brother Season 9" and "New Rap 2025" [30]. The leading animation was "Cang Yuan Tu: The Beauty Award" [31].

Core Viewpoint - The tourism industry, once expected to thrive, is now facing significant challenges, highlighted by the bankruptcy of Qinghai Tourism Investment Group and the struggles of various tourism companies despite an increase in domestic travel and spending [2][3][4][8]. Group 1: Industry Challenges - Qinghai Tourism Investment Group and its subsidiaries have filed for bankruptcy, shocking the tourism sector [3]. - The company, which aimed for significant growth and public listing, mismanaged its resources, leading to a loss of 4.8 billion in registered capital [4]. - 44 listed companies in the tourism sector reported their Q1 earnings, with 25 experiencing negative revenue growth, accounting for 56.8% of the total [4]. Group 2: Financial Performance - Major airlines like China Southern Airlines, China Eastern Airlines, and Air China reported substantial losses in Q1, with losses of 747 million, 995 million, and 2.044 billion respectively [7]. - Despite a 26.4% increase in domestic travel and an 18.6% rise in spending, the tourism industry is struggling financially [8][9]. Group 3: Market Dynamics - The tourism market is saturated, with an increase in A-level scenic spots and travel agencies, yet average income has dropped by nearly 40% [31]. - Online travel platforms like Ctrip and Tongcheng are thriving, with Ctrip reporting a net profit of approximately 4.3 billion in Q1, showcasing the "shovel effect" where service providers profit while actual tourism businesses struggle [28][30]. Group 4: Shifts in Consumer Behavior - The tourism industry is transitioning to a 2.0 era, where experiential value is prioritized over mere scarcity of resources [46][50]. - Successful attractions like Jiuhua Mountain and Disney have capitalized on immersive experiences, contrasting with traditional scenic spots that fail to adapt [39][41]. Group 5: Future Outlook - Many tourism platforms are likely to face severe financial difficulties or bankruptcy if they cannot adapt to the changing market dynamics and consumer preferences [55][56]. - The current environment suggests a need for a significant restructuring within the tourism sector to eliminate ineffective players and allow successful entities to thrive [58][59].

Investment Rating - The industry investment rating is "Positive" (maintained) [2] Core Viewpoints - The report emphasizes the potential of AI applications in video understanding and generation, particularly through the launch of Kwai Keye-VL by Kuaishou, which showcases advanced multimodal capabilities [5] - The report suggests continued investment in the gaming sector, particularly with the recent approval of numerous domestic game licenses, indicating a favorable environment for new game launches [6] - The upcoming summer season is expected to boost consumption in various IP sectors, including games, animated films, concerts, and trendy toys, with specific recommendations for companies in these areas [6] Summary by Sections Industry Data Overview - "Delta Action" ranked first in the iOS free chart, while "Honor of Kings" topped the iOS revenue chart as of June 28, 2025 [13][17] - The film "Sauce Garden Case" achieved the highest box office for the week, grossing 1.64 billion [28] Industry News Overview - AI advancements in embodied intelligence and brain-computer interfaces are highlighted, with ongoing releases in gaming and film sectors [35] - The report notes the launch of Gemini, the first model capable of running locally on robots, enhancing task adaptability and efficiency [35] Company Recommendations - For AI video applications, key recommendations include Kuaishou-W, Shanghai Film, and Tencent Holdings, with beneficiaries like Alibaba-W and Kunlun Wanwei [5] - In the gaming sector, companies such as Xindong Company, Giant Network, and Perfect World are recommended, with beneficiaries including Youyi Time and Kingsoft [6] - For animated films, Shanghai Film is highlighted, while beneficiaries include Zhongwen Online [6] - In the concert and performance sector, Fengshang Culture is recommended, with beneficiaries like Alibaba Pictures and Maoyan Entertainment [6] - The trendy toy sector recommends Blukoo and Aofei Entertainment, with beneficiaries including Pop Mart and Quantum Song [6]

Group 1 - The summer travel market is experiencing a significant increase in demand, with a 70% rise in planned travelers and an 80% increase in transaction volume compared to last year [2] - Family-oriented travel, particularly for children, is expected to dominate the market, with over 60% of travelers being families [2] - The popularity of unique travel experiences is driving demand for customized and high-quality travel products [2][5] Group 2 - Various regions are launching special cultural and tourism activities to stimulate the summer market, including new travel products and promotional measures [4] - Companies are focusing on enhancing their competitiveness by leveraging technology and innovative content in their tourism offerings [6] - The holiday economy is becoming a crucial driver for tourism consumption, emphasizing the need for unique and high-quality tourism products [5][6]

Investment Rating - The industry rating is "Recommended" [4] Core Insights & Investment Recommendations - GPT-5 is expected to be released this summer, marking a significant step towards achieving Artificial General Intelligence (AGI). The integration of natural language capabilities and scientific reasoning will enhance model performance and improve application sentiment [2][24] - The Chinese gaming market experienced a year-on-year growth of 9.86% in May 2025, reaching a market size of 28.051 billion yuan. Mobile games grew by 11.96%, driven by new and mature products [2][24] - The report suggests a cautious outlook on trade negotiations, emphasizing AI as a key investment direction amid global macroeconomic fluctuations. It highlights the importance of technology innovation and self-sufficiency for long-term development [3][25] - Recommended investment opportunities include leading internet companies in Hong Kong, the gaming industry, and the film and cultural tourism sectors, with specific companies identified as beneficiaries [3][25] Summary by Sections Market Overview - During the 24th week of 2025, major indices such as the Shanghai Composite Index and the Hang Seng Index saw declines of 0.51% and 2.25%, respectively. The SW Media Index fell by 1.81% [12][17] Sub-industry Data Gaming Industry - The gaming market in China is showing robust growth, with significant contributions from new releases and established products. The resilience of the overseas market is highlighted, with localization becoming a core competitive barrier [2][24] - The top three iOS games are "Honor of Kings," "Peacekeeper Elite," and "Genshin Impact," while the top three Android games are "Heart Town," "Sword and Legend," and "Genshin Impact" [30][31] Film Industry - The top three films by box office revenue are "Sauce Garden Case" (76.669 million yuan), "New Dragon Trainer" (48.016 million yuan), and "Breakup List" (25.714 million yuan) [27][28] TV Series Industry - The top three TV series based on viewership index are "Ling Jiang Xian" (82.1), "Seven Roots Heart Simple" (76.6), and "Chang'an's Lychee" (81) [33][34] Variety and Animation - The leading variety show is "Infinite Overcoming Class Season 3," followed by "Mahua Special Happiness Season 2" and "Hahaha Season 5" [35] - The top animation series includes "Cang Yuan Tu" and its related series, with a viewership index of 328.9 [36]

Financial Performance - In 2024, the company reported operating revenue of 579.19 million yuan, a decrease of 14.42% year-on-year [1][2] - The net profit attributable to shareholders was 41.77 million yuan, down 68.94% compared to the previous year [1][2] - The net profit excluding non-recurring gains and losses was -9.48 million yuan, a decline of 113.36% from the previous year's 70.98 million yuan [1][2] - The net cash flow from operating activities was 126.52 million yuan, a significant increase of 402.85% from -41.78 million yuan in the previous year [1][2] Q1 2025 Performance - In the first quarter of 2025, the company achieved operating revenue of 93.63 million yuan, representing a year-on-year increase of 171.12% [2][3] - The net profit attributable to shareholders was -1.32 million yuan, an improvement from -5.86 million yuan in the same period last year [2][3] - The net profit excluding non-recurring gains and losses was -12.28 million yuan, also an improvement from -18.79 million yuan year-on-year [2][3] - The net cash flow from operating activities was -26.60 million yuan, compared to 15.70 million yuan in the previous year [2][3] Dividend Distribution - The company announced a dividend distribution plan for 2024, proposing to distribute 2.10 yuan per 10 shares to all shareholders, totaling an estimated cash distribution of 39.57 million yuan [3] Company Background - The company was listed on the Shenzhen Stock Exchange's Growth Enterprise Market on August 24, 2020, with an initial offering price of 138.02 yuan per share [4] - The stock reached a peak price of 242.00 yuan on its first trading day but is currently in a state of decline [4] - The total funds raised during the IPO amounted to 2.487 billion yuan, with a net amount of 2.272 billion yuan after deducting issuance costs [4]

Investment Rating - The industry rating is "Recommended" [4] Core Insights & Investment Recommendations - The recent US-China trade negotiations in London have reached a principled framework, indicating substantial progress in managing differences and stabilizing economic relations, which may support global supply chain recovery [2][21] - OpenAI has launched the new o3-pro model, reducing its price by 80% and input/output costs by 87%, reflecting a shift towards efficiency optimization in large model technology and accelerating AI technology penetration into small and medium enterprises [2][21] - The report maintains a cautious optimism regarding trade negotiations and highlights AI as a key investment direction amid global macroeconomic volatility, emphasizing the importance of technological innovation and self-sufficiency for long-term development [3][22] Sub-industry Data Film Industry - The top three films by box office this week are "How to Train Your Dragon: The Hidden World" with 58.175 million yuan (25.6% market share), "Mission: Impossible 8" with 54.90 million yuan (24.2%), and "Time Son" with 28.366 million yuan (12.5%) [24][25] Gaming Industry - The top three iOS games by revenue are "Honor of Kings," "Peacekeeper Elite," and "Endless Winter," while the top three Android games by popularity are "Heart Town," "Sword Legend," and "My Leisure Time" [27][28] TV Series Industry - The top three TV series by broadcast index are "The Cang Hai Chuan," "Lin Jiang Xian," and "The Lychee of Chang'an," with indices of 85.3, 84.2, and 82.2 respectively [30][31] Variety Shows & Animation - The top variety show is "Ha Ha Ha Ha Season 5" with a broadcast index of 80.6, followed by "Run, Brother Season 9" and "Unlimited Exceeding Class Season 3" [32] - The top three animated shows by viewership index are "Cang Yuan Tu," "Xian Ni," and "Perfect World," with indices of 340.2, 225, and 222.5 respectively [34]

Group 1 - The IP economy concept stocks experienced significant declines, with Fuchun Co., Ltd. (300299) falling over 9% [1] - Chuangyuan Co., Ltd. (300703) and Xinghui Entertainment (300043) both dropped more than 8% [1] - Deyi Cultural Creation (300640) and Fengshang Culture (300860) saw declines exceeding 7% [1] Group 2 - Other companies such as Ciweng Media (002343) and Yue Media (002181) also followed the downward trend [1] - There is a mention of dark pool fund flows revealing signals of stock accumulation by major players [1]

Investment Rating - The report maintains an "Outperform" rating for the social services industry [1] Core Insights - The overall revenue of the sector is steadily increasing, but the recovery in performance is slower, with significant differentiation among sub-sectors. Attention is recommended for cyclical recovery sectors such as human resources and exhibitions, as well as resilient sectors like tourism and scenic spots [1][2] - In 2024, the social services sector achieved a total revenue of 191.54 billion, a year-on-year increase of 36.57%, while the net profit attributable to shareholders was 7.48 billion, a year-on-year decrease of 18.21%. The overall profitability has declined [10][14] - In Q1 2025, the sector generated a revenue of 44.84 billion, a year-on-year increase of 38.75%, with a net profit of 1.81 billion, a year-on-year increase of 33.06% [20][22] Summary by Sections Sector Summary - The revenue growth rate outperformed the profit growth rate, with the professional services and education sectors performing better. In 2024, the professional services sector saw a year-on-year increase of 79.57%, while the education sector's profit level improved significantly [10][14] - In Q1 2025, the professional services sector led with a revenue growth of 89.62%, followed by tourism and scenic spots at 7.39% [22] Tourism - The domestic travel market shows strong resilience, with a total of 5.615 billion domestic tourists in 2024, a year-on-year increase of 14.80% [34] - The cross-border travel market is experiencing high demand, with inbound tourists reaching 132 million in 2024, a year-on-year increase of 60.8% [40] Hotels - Business travel demand is still recovering, with the RevPAR expected to be under pressure throughout 2024 [13] Catering - The catering market is expected to see slower revenue growth in 2024, with Q1 2025 showing some improvement [16] Duty-Free - Duty-free sales in offshore areas are showing marginal improvement, with city channels expected to contribute to growth [18] Human Resources - The human resources sector is experiencing stable data operations, but employment market pressures remain [22] Exhibitions - The domestic exhibition market is steadily growing, with the number of exhibitions remaining stable in 2024 [24]

Investment Rating - The report maintains an "Accumulate" rating for the company [1][6] Core Views - The company reported a revenue of 579 million yuan in 2024, a year-on-year decrease of 14.42%, and a net profit of 41.77 million yuan, with a proposed cash dividend of 2.1 yuan per 10 shares, down 68.94% year-on-year [2] - In Q1 2025, the company achieved a revenue of 94 million yuan, a significant increase of 171.12% year-on-year, but reported a net loss of 1.32 million yuan [2] - The company is focusing on cultural and technological innovation, exploring C-end business through immersive experiences and AR technology [4][5] Summary by Sections Revenue and Profitability - The company's gross margin in 2024 was 32.14%, down 5.23 percentage points year-on-year, with the gross margin for large cultural performances at 28.65% and cultural tourism performances at 34.22% [3] - The company had a total order backlog of 368 million yuan at the end of 2024, with 87.88 million yuan from large cultural performance projects and 280 million yuan from cultural tourism projects [3] Business Strategy - The company has been transitioning from B-end large events to C-end cultural tourism consumption since 2022, with projects like the Shanghai 632 project generating 32.20 million yuan in revenue and 7.67 million yuan in net profit in 2024 [4] - The company is leveraging technology in its projects, including the use of low-altitude drone performances and online cultural entertainment content [4] Market Outlook - The "first launch economy" has been identified as a key task by the central economic work conference, which is expected to boost domestic demand and benefit the cultural tourism sector [5] - The tourism economy index has shown a year-on-year increase of 2.1%, indicating a positive trend in the industry [5] Financial Forecast - Revenue projections for 2025-2027 are 693 million yuan, 783 million yuan, and 866 million yuan respectively, with net profits expected to be 140 million yuan, 153 million yuan, and 167 million yuan [6][9] - The report forecasts an EPS of 0.73 yuan, 0.80 yuan, and 0.87 yuan for the same period, with corresponding P/E ratios of 36, 33, and 30 times [6][9]