XD INC(02400) 东吴证券·2024-08-07 07:01Investment Rating - Buy (Maintained) [1] Core Views - The company is expected to achieve revenue of 2.18-2.23 billion yuan in 2024H1, a year-on-year increase of 24.4%-27.2%, and net profit of 220-270 million yuan, a year-on-year increase of 114.0%-162.7%, exceeding expectations [3] - The new game cycle has begun, and the profit inflection point has emerged, driven by the successful launch of self-developed games such as "出发吧麦芬" and "铃兰之剑" [3] - TapTap's monetization efficiency is expected to improve steadily, benefiting from increased industry advertising demand [3] Financial Forecasts and Valuation - Revenue is projected to grow from 3,433 million yuan in 2022 to 6,154 million yuan in 2026, with a significant year-on-year increase of 73.24% in 2024 [2] - Net profit attributable to the parent company is expected to turn positive, reaching 616.44 million yuan in 2024, up from a loss of 553.50 million yuan in 2022 [2] - EPS is forecasted to increase from -1.15 yuan in 2022 to 1.45 yuan in 2026, with a P/E ratio of 16.34x in 2024 [2] Game Operations - The revenue growth in 2024H1 is primarily driven by new games "出发吧麦芬" and "铃兰之剑," partially offset by the natural decline in revenue from existing games [3] - "出发吧麦芬" has performed better than expected, with stable rankings on the iOS game bestseller list, and its profit elasticity is expected to be released in 2024H2 [3] - The newly launched "心动小镇" has shown excellent user retention and commercialization potential, while "铃兰之剑" has been launched overseas, with "出发吧麦芬" planned for release in Japan and South Korea in late 2024 [3] TapTap Performance - TapTap's information service revenue in China continued to grow year-on-year in 2024H1, driven by increased advertising demand and the launch of exclusive self-developed games [3] - TapTap's MAU in China has rebounded, and its advertising conversion efficiency has been optimized, leading to steady monetization efficiency improvement [3] - With the normalization of marketing and the launch of new games, TapTap's MAU and revenue are expected to continue growing in 2024H2 and beyond [3] Market Data - The closing price of the stock is 22.75 HKD, with a one-year low/high range of 7.47/23.80 HKD [5] - The P/B ratio is 6.40x, and the market capitalization is 10,935.18 million HKD [5] Financial Ratios - ROE is expected to improve significantly from -4.86% in 2023 to 26.51% in 2024 [9] - The gross margin is projected to remain stable at around 57% from 2024 to 2026 [9] - The P/E ratio is forecasted to decrease from 16.34x in 2024 to 14.41x in 2026, indicating improving valuation attractiveness [9] Cash Flow and Balance Sheet - Operating cash flow is expected to increase significantly from 235.45 million yuan in 2023 to 1,080.96 million yuan in 2024 [8] - The company's total assets are projected to grow from 4,409.44 million yuan in 2023 to 6,783.28 million yuan in 2026, driven by increased liquidity and non-current assets [8] - The debt-to-asset ratio is expected to decrease from 57.62% in 2023 to 41.70% in 2026, reflecting improved financial health [8]