第一上海证券：维持网龙(00777)“买入”评级目标价15港元

Core Viewpoint - First Shanghai Securities maintains a "Buy" rating for NetDragon (00777) with a target price of HKD 15, highlighting the stability of its gaming business and the potential market space for its education business [1] Group 1: 2024 Performance - NetDragon is expected to achieve a total revenue of CNY 6.05 billion and a net profit of CNY 310 million in 2024, with performance pressure stemming from adjustments in its two core businesses [2] - The gaming business revenue is projected at CNY 3.94 billion, with a decline in income due to the company's proactive reduction of payment thresholds to expand its user base [2] - Despite revenue challenges, net profit is expected to increase by 17.4% year-on-year, reflecting effective cost control, and the gross margin is anticipated to rise by 3.3 percentage points to 65.2% [2] Group 2: Gaming Business Adjustments - The main IP, "Magic Domain," experienced a revenue decline, but the overall Monthly Active Users (MAU) grew by 10.1%, with the "Magic Domain Interconnected Version" MAU significantly increasing by 37.5%, indicating effective user engagement strategies [2] - The company launched "Magic Domain Rebirth" this year and plans to release a series of new games, including the MMORPG mobile game "Code-Dragon," to enrich its product matrix [2] - The AI + gaming strategy is beginning to show cost reduction and efficiency improvements, suggesting a potential stabilization and recovery in the gaming business [2] Group 3: Education Business Challenges - The education business generated revenue of CNY 2.11 billion, showing a year-on-year decline due to a cyclical adjustment in the overseas education information market [3] - The demand for Interactive Flat Panel Displays (IFPD) has shown temporary weakness, although gross margin improved by 1 percentage point to 26% due to optimized material and transportation costs [3] - While there are short-term pressures from fluctuations in overseas education budgets, the long-term logic of increasing global digital penetration in education remains unchanged, with potential for profitability improvement post-market adjustment [3]