IGG(HK:00799) Zhi Tong Cai Jing·2025-08-29 03:02Core Viewpoint - CICC maintains IGG's earnings forecast and outperform industry rating, raising the target price by 26% to HKD 5.23, reflecting a valuation premium due to the strong initial performance of new products [1] Group 1: Financial Performance - For 1H25, IGG reported a revenue decline of 1% to HKD 2.721 billion, with a net profit of HKD 322 million and Non-IFRS net profit of HKD 332 million, aligning with CICC's expectations [2] - The company announced an interim dividend and special dividend totaling HKD 0.139 per share, representing approximately 50% of 1H25 net profit, with share buybacks accounting for about 11% of net profit [2][5] - The Non-IFRS net profit for 1H25 was HKD 323 million, with a gross margin increase of 4 percentage points and a sales expense ratio increase of 5 percentage points, while the adjusted net profit margin decreased by 0.5 percentage points [5] Group 2: New Product Launch - The new SLG game "Fate War" launched in early August generated HKD 20 million in revenue within the first three weeks, with a focus on user acquisition and revenue performance post-version updates [3] - The company plans to release a new version on September 30, which will include technical updates for low-performance devices and streamlined daily operations to enhance user engagement in core gameplay [3] Group 3: Existing Product Performance - The core existing products performed in line with expectations, with "Lords Mobile" experiencing a 14% revenue decline in 1H25, attributed to its maturity phase [4] - Revenue for "Doomsday" and "Viking Rise" grew by 6% and 18% year-on-year, respectively, with slight quarter-on-quarter declines, meeting expectations [4] - The company is planning gameplay adjustments for "Lords Mobile" by the end of the year and has initiated collaborations with films and other franchises to enhance user engagement and revenue [4]