XD INC(02400) 国元证券·2024-09-04 00:42Investment Rating - Maintain "Buy" rating [4] Core Views - The company achieved significant growth in revenue and net profit in H1 2024, driven by new game launches and rapid user growth on the TapTap platform [2][3] - The company's self-developed games, such as "Let's Go Muffin" and "Sword of Linlan," contributed to the revenue growth, while TapTap's user base expanded significantly [3] - The company is focusing on cost reduction and efficiency improvement, with plans to further enhance commercialization and expand its game portfolio [4] Financial Performance - Revenue in H1 2024 reached RMB 2,221 million, a YoY increase of 26.7% [2] - Net profit attributable to shareholders was RMB 205 million, a YoY increase of 127.4% [2] - Gross profit was RMB 1,497 million, with a gross margin of 67.4%, up 8.2 percentage points YoY [2] - Sales and R&D expense ratios were 31.31% and 18.89%, respectively, with sales expenses increasing due to marketing and advertising costs for new games and TapTap [2] Business Segments - Game business revenue reached RMB 1,486 million, a YoY increase of 29.3%, driven by online game revenue growth of 32.0% [3] - Information services revenue was RMB 734 million, a YoY increase of 21.7%, supported by TapTap's user growth [3] - TapTap China's average MAU grew by 27.3% YoY to 43.2 million, benefiting from the launch of "Let's Go Muffin" and other games [3] Future Outlook - The company plans to launch "Let's Go Muffin" in multiple overseas markets in H2 2024 [3] - Three games are currently in development, with "Let's Go Muffin" and "Sword of Linlan" expected to drive future growth [3] - The company is preparing to launch AIGC service TapSight to enhance customer service capabilities [3] Valuation and Forecast - Estimated net profit for 2024-2026 is RMB 608 million, RMB 768 million, and RMB 938 million, respectively [4] - EPS for 2024-2026 is projected to be RMB 1.26, RMB 1.60, and RMB 1.95 per share, with P/E ratios of 14x, 11x, and 9x, respectively [4] Market Data - 52-week high/low price: HKD 23.80/7.47 [6] - Total market capitalization: HKD 9,469.14 million [6]