宋城演艺：上半年佛山、西安项目均盈利，跟踪下半年千古情演出趋势

Investment Rating - The report maintains an "Outperform" rating for Songcheng Performance Development Co Ltd (300144 SZ) [1][5] Core Views - H1 2024 revenue grew 59% YoY to 1 18 billion RMB while net profit attributable to parent company surged 82% to 550 million RMB meeting the midpoint of guidance [1][3] - Q1 2024 saw strong recovery with revenue up 138 7% and net profit up 317 3% YoY driven by normalized operating days and low base effect [1][3] - Q2 2024 revenue increased 22 1% and net profit grew 23 2% with new projects contributing significantly despite some pressure on existing projects [1][3] - New projects in Foshan and Xi'an both turned profitable in H1 2024 with Foshan contributing 50 million RMB and Xi'an 20 million RMB in net profit [1][4] - Traditional projects remained stable but showed divergence with Hangzhou up 36% while Lijiang declined 15% due to local tourism market adjustments [1][4] - Light-asset model contributed 140 million RMB in revenue up 70 million RMB YoY with the Three Gorges project expected to add 20+ million RMB in Q3 [1][4] - E-commerce commission fees doubled to 128 million RMB reflecting rapid growth in online channels [1][4] Financial Performance - 2024E revenue is projected at 2 421 billion RMB up 25 7% YoY with net profit forecast at 1 109 billion RMB a significant turnaround from 2023 [2][5] - EPS is expected to reach 0 42 RMB in 2024E up from -0 04 RMB in 2023 with ROE recovering to 13 8% [2][5] - EBIT margin is forecast to improve to 53 6% in 2024E from 51 0% in 2023 reflecting operational efficiency [2][5] - The company's cash position is strong with cash and equivalents projected to grow to 3 568 billion RMB by end of 2024E [7] Industry and Valuation - The tourism and scenic spot industry is recovering with Songcheng's performance outpacing peers [1][6] - The company trades at 18 1x 2024E PE and 2 5x PB which is attractive given its growth prospects [2][5] - Comparable companies in the sector such as Emei Shan A (000888 SZ) and Lijiang Co Ltd (002033 SZ) also carry "Outperform" ratings [6]