KINGNET(SZ:002517) Guotai Junan Securities·2024-10-31 00:51Investment Rating - The report maintains a "Buy" rating for the company [5]. Core Views - The company's Q3 performance exceeded market expectations, with a net profit of 471 million yuan, representing a year-on-year growth of 31.52% [2][4]. - The company has a robust product pipeline for Q4 2024 and 2025, which is expected to support steady growth in performance [1][2]. - The target price has been raised to 17.64 yuan from the previous 13.29 yuan, based on a relative valuation of 21x PE for 2024, reflecting an overall increase in industry valuations [1][5]. Financial Summary - Revenue for 2024 is projected to be 5,435 million yuan, with a year-on-year growth of 26.5% [3]. - Net profit for 2024 is estimated at 1,810 million yuan, reflecting a growth of 23.8% [3]. - Earnings per share (EPS) for 2024 is forecasted at 0.84 yuan, consistent with previous estimates [1][3]. - The company’s net profit margin is expected to remain strong, with a projected return on equity (ROE) of 26.8% for 2024 [3]. Product Pipeline and Market Expansion - The company has accelerated its overseas expansion, with several products launched in regions outside mainland China since July 2024 [1][2]. - Upcoming product launches include titles such as "Rainbow Orange" and "Tomb Raider: Journey," which are expected to contribute to revenue in 2024 and 2025 [1][2]. Market Position - The company’s current market capitalization is approximately 28.99 billion yuan, with a share price of 13.47 yuan [6][11]. - The company’s price-to-earnings (PE) ratio for 2024 is projected at 16.02, which is competitive compared to industry peers [11].