ZDDC(SH:600633) Haitong Securities·2024-08-12 10:02Investment Rating - The investment rating for the company is "Outperform the Market" [1] Core Views - The company's performance is currently under pressure, significantly impacted by non-operating gains and losses. In H1 2024, the company achieved revenue of 1.413 billion yuan, a year-on-year decrease of 16.36%, and a net profit attributable to shareholders of 147 million yuan, down 76.71% year-on-year [4] - The digital culture business is steadily developing, with the digital marketing segment contributing to new growth. The company has seen a significant increase in registered users for its online gaming platform, indicating good growth potential [4] - The company is making progress in the field of digital technology innovation, particularly with the development of large models that have received regulatory approval, positioning the company as a leader in this area [5] Financial Summary - In H1 2024, the company reported a net profit of 147 million yuan, down 76.71% year-on-year, while the net profit excluding non-recurring gains and losses was 203 million yuan, a decrease of 58.96% year-on-year [4] - The company's revenue is projected to decline to 2.765 billion yuan in 2024, with a year-on-year decrease of 10.2%, before recovering to 3.045 billion yuan by 2026 [6][11] - The estimated earnings per share (EPS) for 2024, 2025, and 2026 are 0.41 yuan, 0.46 yuan, and 0.51 yuan, respectively [7] Business Segments - The online gaming operation is expected to generate revenue of approximately 1.185 billion yuan in 2024, reflecting a year-on-year decrease of 10% [8] - The digital marketing segment is projected to grow significantly, with expected revenue of 707 million yuan in 2024, representing a year-on-year increase of 110% [8] - The technology information service segment is forecasted to decline to 545 million yuan in 2024, a decrease of 15% year-on-year [8] Valuation and Forecast - The company is valued using both PE and PS methods, with a target price range of 8.20 to 10.25 yuan per share based on a PE ratio of 20-25 times for 2024 [7] - The projected price-to-sales (PS) ratio for 2024 is estimated to be between 4.0 and 4.5, corresponding to a price range of 9.12 to 10.26 yuan per share [7]