KINGNET(002517) 华金证券·2024-10-30 09:20Investment Rating - Maintains a "Buy-A" rating, indicating strong confidence in the company's future performance [4] Core Views - The company achieved a total revenue of 3.928 billion yuan in the first three quarters of 2024, a year-on-year increase of 29.65%, with net profit attributable to the parent company reaching 1.28 billion yuan, up 18.27% year-on-year [1] - In Q3 2024, the company's revenue was 1.372 billion yuan, a 30.33% increase year-on-year, and net profit attributable to the parent company was 471 million yuan, up 31.52% year-on-year [1] - The company's growth is driven by a combination of nostalgic and innovative games, with multiple titles such as "Sword and Fairy: New Beginnings" and "New Heaven Sword and Dragon Saber" performing well [1] - The company is expanding its overseas business, with plans to release games like "Sword and Fairy: New Beginnings" and "Monster Alliance" in international markets [1] - R&D expenses in Q3 2024 reached 170 million yuan, a 36% increase year-on-year, reflecting the company's commitment to developing high-quality games [2] - The company has a robust pipeline of upcoming games, including "Tomb Raider: Departure" and "Douluo Continent: Legend of the Evil Slayer" [2] Financial Projections - Revenue is projected to grow from 5.389 billion yuan in 2024 to 7.519 billion yuan in 2026, with net profit attributable to the parent company expected to increase from 1.919 billion yuan in 2024 to 2.936 billion yuan in 2026 [3] - EPS is forecasted to rise from 0.89 yuan in 2024 to 1.36 yuan in 2026, with P/E ratios decreasing from 27.5 in 2024 to 23.9 in 2026 [3] - The company's gross margin is expected to remain stable at around 80.6% to 80.7% from 2024 to 2026 [3] - ROE is projected to decline slightly from 27.5% in 2024 to 23.9% in 2026, reflecting the company's continued profitability [3] Market Performance - The company's stock price as of October 29, 2024, was 13.47 yuan, with a total market capitalization of 28.994 billion yuan [4] - Over the past 12 months, the stock has shown a relative return of 23.07% and an absolute return of 33.24% [5] Business Strategy - The company focuses on a dual strategy of "nostalgic + innovative" games, broadening its competitive advantage beyond the legendary game genre [2] - The company is actively developing its game community platforms, such as the 996 Game Box and Cangyue Island, which contribute to advertising revenue and information services [1]