Orient Securities·2025-11-27 13:53Investment Rating - The report maintains a "Buy" rating for the company with a target price of 248.49 HKD / 226.29 CNY [3][5]. Core Insights - The company's Blizzard games are gradually resuming operations, and the evergreen game "Yan Yun Shi Liu Sheng" is performing excellently both domestically and internationally. The anticipated launch of "Forgotten Sea" in 2026 is expected to drive growth [3]. - The adjusted profit forecasts for the company from 2025 to 2027 are 362 billion, 398 billion, and 450 billion CNY respectively, reflecting slight adjustments based on game performance and Q3 financial results [3]. Financial Performance Summary - Revenue Forecasts: The company expects revenues of 103,468 million CNY in 2023, growing to 138,188 million CNY by 2027, with a CAGR of approximately 12.37% from 2025 to 2027 [4]. - Net Profit: The net profit attributable to the parent company is projected to increase from 29,417 million CNY in 2023 to 44,999 million CNY in 2027, with a notable growth rate of 21.98% in 2025 [4]. - Earnings Per Share (EPS): EPS is expected to rise from 9.29 CNY in 2023 to 14.20 CNY in 2027 [4]. - Profit Margins: The gross margin is projected to improve from 60.95% in 2023 to 66.19% in 2027, while the net margin is expected to stabilize around 32% [4]. Market Performance - The company's stock price as of November 20, 2025, was 212.6 HKD, with a 52-week high of 248 HKD and a low of 125.99 HKD [5]. - The company's market capitalization is approximately 673,508 million HKD [5]. Game Performance Insights - The total revenue from games and related value-added services in Q3 2025 was 233 billion CNY, reflecting a year-on-year growth of 12% [10]. - The game "Dream Journey" continues to see high activity levels, and "Yan Yun Shi Liu Sheng" is expected to perform well in overseas markets in Q4 [10].