XD INC(02400) 华泰证券·2025-03-06 03:20Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of HKD 49.10 [8][9]. Core Insights - The company is expected to achieve revenue of approximately RMB 4.96 billion to RMB 5.04 billion in 2024, representing a year-on-year increase of about 46.3% to 48.7%, which aligns with previous expectations [1][13]. - The net profit is projected to be around RMB 860 million to RMB 940 million, significantly exceeding prior expectations of RMB 610 million, marking a turnaround from losses in 2023 [1][13]. - Key drivers for the performance include strong overseas sales of self-developed games, operational leverage from TapTap's revenue growth, and effective cost management [1][13]. Summary by Sections Game Performance - The game "Heart Town" focuses on high user engagement and monetization strategies, maintaining a stable ranking around the 10th position in early 2025 [2]. - "Start Muffin" has shown impressive performance in overseas markets, with an estimated global monthly revenue of approximately RMB 70.4 million in January 2025 [2]. TapTap Platform Growth - TapTap's monthly active users (MAU) reached 43.24 million in the first half of 2024, with expectations to exceed 60 million by 2025, driven by exclusive game releases and improved user retention [3]. - The platform is expected to benefit from potential changes in Apple's policies regarding app downloads through third-party stores, which could significantly increase traffic [3]. AI Integration and Advertising - TapTap is leveraging AI for advertising, utilizing user behavior data to enhance ad targeting and reduce design time for developers [4]. Profit Forecast and Valuation - The profit forecasts for 2024-2026 have been revised upwards, with net profit estimates of RMB 900 million, RMB 1.02 billion, and RMB 1.21 billion, reflecting increases of 49.0%, 39.4%, and 44.7% respectively [5][14]. - The valuation for TapTap's business is set at a price-to-sales (PS) ratio of 6x, while the gaming business is valued at a price-to-earnings (PE) ratio of 18x, leading to a target price of HKD 49.10 [5][15].