KINGNET(SZ:002517) Huaan Securities·2024-10-30 07:48Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported a revenue of 3Q24 at 3.72 billion yuan, representing a year-over-year increase of 30.33% [1] - The net profit attributable to the parent company for the first three quarters of 2024 was 1.28 billion yuan, up 18.27% year-over-year [1] - The company has a strong IP portfolio, including popular titles in the anime and traditional culture sectors, which supports its game development and innovation [1] - The company has a rich pipeline of new games, with several titles receiving approval for release, which is expected to drive further revenue growth [1] Financial Performance - For the first three quarters of 2024, the company achieved a total revenue of 3.928 billion yuan, a year-over-year increase of 29.65% [2] - The net profit attributable to the parent company for the same period was 1.28 billion yuan, reflecting an 18.27% year-over-year growth [2] - The gross margin for 3Q24 was 82.6%, a slight decrease of 1.1 percentage points year-over-year but an increase of 0.6 percentage points quarter-over-quarter [1] - The net profit margin for 3Q24 was 34.3%, an increase of 0.3 percentage points year-over-year and 3.6 percentage points quarter-over-quarter [1] Future Projections - The company is projected to achieve net profits of 1.861 billion yuan, 2.271 billion yuan, and 2.507 billion yuan for the years 2024, 2025, and 2026, respectively, with year-over-year growth rates of 27.3%, 22.0%, and 10.4% [1][2] - The expected P/E ratios for 2024, 2025, and 2026 are 15.6, 12.8, and 11.6, respectively [1][2] Cost Management - The company has effectively controlled costs, leading to profit release, with a sales expense ratio of 30.8% in 3Q24, an increase of 1.8 percentage points year-over-year but a decrease of 7.0 percentage points quarter-over-quarter [1] - The management expense ratio decreased to 3.3%, down 2.7 percentage points year-over-year, primarily due to reduced expenses related to employee stock ownership plans [1]