Investment Rating - The industry investment rating is "Outperform the Market," indicating an expected relative increase of over 10% in the industry index compared to the broader market over the next six months [4][7]. Core Insights - The approval volume of game licenses in October remains high, with a total of 159 domestic games and 7 imported games approved, contributing to a total of 1,354 domestic games approved year-to-date [2]. - The launch of the client version of "Arknights" by Eagle Dynamics is expected to strengthen its leading position in the two-dimensional tower defense genre, having generated nearly 600 million yuan in revenue in its first month and achieving a download count of 30.92 million [2]. - The overall supply side continues to release, with a normalization trend in license issuance, indicating a sustained recovery in the industry [3]. Summary by Sections Game License Approval - In October, 159 domestic games and 7 imported games received approval, maintaining a high issuance volume [2]. - Year-to-date, 1,354 domestic games and 87 imported games have been approved [2]. Market Performance - The client version of "Arknights" has achieved significant market success, ranking in the top 15 of the iOS bestsellers shortly after launch and maintaining a high rating on platforms like TapTap and App Store [2]. - The game is noted for its unique art style and rich narrative, contributing to its popularity and extensive fan engagement [2]. Investment Recommendations - The report suggests focusing on leading companies with product reserves, R&D capabilities, and diverse thematic layouts, as the industry continues to recover and expand [3].

Investment Rating - The industry is rated as "Outperforming the Market," indicating a projected increase of over 10% relative to the market index in the next six months [4][7]. Core Insights - In September, the issuance of game licenses remained high, with 145 domestic games and 11 imported games approved, contributing to a total of 1,195 domestic games approved year-to-date [2]. - The newly approved game "Honkai: Star Rail" by miHoYo is a notable addition, focusing on a large world and creature collection, combining exploration with RPG elements, and featuring a PVE auto-battler gameplay [2]. - The game has garnered significant interest, with over 4.09 million pre-registrations by September 25, indicating strong market potential [2]. Summary by Sections Industry Overview - The game license issuance continues to show a stable upward trend, with a diverse range of products and well-known manufacturers involved [2][3]. - The overall supply side is consistently releasing new titles, reinforcing the normalization of license issuance and ongoing industry recovery [3]. Market Trends - Major companies are increasingly focusing on creature-raising games, with competitive titles emerging from Tencent and other developers, suggesting a crowded market landscape [2]. - The unique ecological design and gameplay of "Honkai: Star Rail" may allow it to carve out a niche in this competitive environment [2]. Investment Recommendations - It is advised to focus on leading companies with strong product pipelines, research capabilities, and diverse thematic layouts [3].

Core Insights - The issuance of game licenses in September remains high, with 145 domestic games and 11 imported games approved, indicating a stable trend in the normalization of license issuance and ongoing industry recovery [1][2] Group 1: Game License Issuance - In 2023, a total of 1,195 domestic games have been approved, with 145 approved in September alone, including titles from major companies like Tencent and miHoYo [2] - For imported games, 80 have been approved year-to-date, with 11 approved in September, featuring titles from companies such as Chuangmeng Tiandi and Xinghui Games [2] Group 2: Market Trends and Competitive Landscape - miHoYo's new game, "Honkai: Inheritance Spirit," combines world exploration with pet-raising elements and features a PVE auto-chess gameplay, which is expected to enhance player engagement [3] - The game has garnered significant interest, with over 4.09 million pre-registrations by September 25, indicating strong market potential [3] - The competition in the pet-raising game segment is intensifying, with several major players like Tencent and other developers also launching similar titles [3]

Core Viewpoint - The gaming sector continues to show strong performance, with significant gains in stock prices and a robust increase in game approvals, indicating a positive outlook for the industry. Group 1: Stock Performance - The gaming sector saw notable stock price increases, with companies like Xinghui Entertainment and Perfect World hitting the daily limit up, while others like 37 Interactive Entertainment and Giant Network also experienced gains [1] - The gaming ETF rose over 4%, with the Huatai-PB gaming ETF increasing by 3.5%, and both ETFs showing over 58% growth year-to-date [2][4] Group 2: Game Approvals and Market Growth - From January to August, the National Press and Publication Administration reported a 23.53% year-on-year increase in the issuance of domestic online game licenses, reflecting ongoing regulatory support for the gaming industry [6] - In August, a record number of 166 domestic games and 7 imported games were approved, contributing to a total of 1,119 game licenses issued from January to August, marking a 20.8% year-on-year increase [9][10] Group 3: Game Releases and Performance - Domestic mobile games are thriving, with the upcoming launch of "Iser" by Xindong Company generating significant anticipation, ranking 4th on Taptap's reservation list [7] - Giant Network's "Supernatural Action Group" has seen a rise in rankings and revenue following the introduction of new gameplay features, indicating strong ongoing performance [7] - Several mobile games from Century Huatong's subsidiary, including "Whiteout Survival," achieved record revenues in August, contributing to a 11% month-on-month increase in global revenue for the subsidiary [8] Group 4: Industry Outlook - Open Source Securities suggests that the gaming industry will continue to experience high demand and a favorable supply-demand dynamic, with the current valuation offering attractive investment opportunities [9] - Guoxin Securities highlights that the gaming market's revenue grew steadily in the first seven months, with a positive outlook driven by policy support, market conditions, and AI applications [9][10]

Semiconductor and New Energy Sector - The semiconductor industry saw a significant intraday surge, positively impacting technology stocks, with companies like Chengdu Huamei and Yuanjie Technology experiencing substantial gains [1] - The new energy sector was also active, with leading stocks such as CATL (300750), Sungrow Power (300274), and EVE Energy (300014) rising [1] Historical Highs in Leading Stocks - Several leading stocks, including Seres (601127), Zijin Mining (601899), Fuyao Glass (600660), and Shandong Gold (600547), reached historical highs, each with a market capitalization exceeding 100 billion [2] - Hengrui Medicine (600276) also achieved a stage high, closing up 4.33% after receiving approval for clinical trials of HRS-7172 tablets and SHR-A2009 injections [2] Cultural and Media Sector Performance - The cultural media sector showed strong performance, particularly in the gaming segment, with companies like Giant Network (002558) and Shenzhou Taiyue (300002) leading the gains [3] Gaming Industry Trends - The gaming sector is transitioning from a "license recovery" phase to a dual-driven model of "supply increase + AI implementation," focusing on content quality and operational efficiency [6] - The domestic gaming market reported a sales revenue of 168 billion yuan in the first half of the year, reflecting a year-on-year growth of 14.08% [6] Investment Insights - Analysts suggest that the gaming industry is entering a favorable cycle, with trends indicating increased payments on mini-game platforms and innovations in gameplay attracting diverse user groups [7] - The integration of AI technology is expected to enhance production and gaming experiences, providing growth opportunities for the industry [7]

Core Viewpoint - The issuance of game licenses in August 2025 reached a record high, with 166 domestic games and 7 imported games approved, indicating a stable trend in the normalization of license issuance and ongoing industry recovery [1][2]. Group 1: Game License Issuance - A total of 1,050 domestic games have been approved since the beginning of the year, with 166 games approved in August alone, marking a month-on-month increase of 39 games [2]. - The approved domestic games include titles from well-known companies such as NetEase, Bilibili, and others, showcasing a diverse range of products [2]. - For imported games, 69 have been approved this year, with 7 approved in August, including Tencent's "Kaeas Dreamland" [2]. Group 2: Notable Game Titles - "Kaeas Dreamland," developed by South Korea's Smilegate, is expected to perform well due to its unique gameplay mechanics and high-quality 2D animation [3]. - "Escape from Duckov," developed by Bilibili's "Carbonated Squad," has received positive feedback during its Steam testing phase, with over 200,000 players and a 93% "very positive" rating [4]. - The game combines tactical gameplay with a cute art style, filling a niche in the "light tactical game" market [4].

Investment Rating - The industry investment rating is "Outperform the Market" indicating a potential increase of over 10% relative to the market index in the next six months [3][6]. Core Insights - In August 2025, the number of game approvals reached a record high, with 166 domestic games and 7 imported games approved, marking a year-to-date total of 1,050 domestic games and 69 imported games [1][2]. - Notable games that received approval include Tencent's "Kareus Dream" and bilibili's "Escape from Duckov," both of which are expected to perform well in the market due to their unique gameplay and strong development teams [1][2]. - The report emphasizes the ongoing normalization of game approvals, suggesting a steady recovery in the industry, and recommends focusing on leading companies with diverse product portfolios and strong R&D capabilities [2]. Summary by Sections Industry Events - The National Press and Publication Administration announced the approval of 166 domestic and 7 imported games in August 2025, with significant titles like "Kareus Dream" and "Escape from Duckov" gaining attention [1][2]. Game Performance - "Kareus Dream," developed by Smilegate's SUPER CREATIVE, combines dark fantasy elements with innovative gameplay mechanics, while "Escape from Duckov" offers a unique blend of cute aesthetics and tactical gameplay, achieving over 200,000 players and a 93% positive rating during its Steam testing phase [1][2]. Investment Recommendations - The report suggests that the industry is on a recovery path with a consistent release of game approvals, and it advises investors to pay attention to top-tier companies with strong product reserves and diverse thematic strategies [2].

Core Insights - A total of 15 A-share gaming companies have released their half-year performance forecasts, with 9 expecting profits and 6 anticipating losses [2][3] - The resumption of game license approvals since April has primarily benefited small and medium-sized game developers, with major players like Tencent and NetEase not featured in the latest approvals [2][4] - Many companies attribute their performance growth to established games rather than new releases, indicating that the impact of new game licenses has yet to be fully realized [2][3] Performance Summary - Among the 15 companies, 5 reported an increase in net profit compared to the previous year, while 4 experienced a decline [3] - Notable profit growth includes: - 37 Interactive Entertainment: Net profit growth of 87.42% to 99.13% [3] - Perfect World: Net profit growth of 330.84% to 350.25% [3] - Kaineng Network: Net profit growth of 69.63% to 134.60% [3] - Ice Age Network reported an extraordinary increase in net profit by 3924.74% to 4968.20%, with a projected profit of 270 million to 340 million yuan [3] Industry Context - The gaming industry is currently undergoing an adjustment period characterized by tightening regulations, diminishing demographic advantages, and a challenging external financing environment [4][5] - The issuance of game licenses is becoming more regular, with a total of 241 games approved since April [5][6] - Analysts suggest that while the basic market for gaming remains stable, significant growth akin to previous years is unlikely in the short term [5][6] Market Outlook - The overall performance of A-share gaming companies is still seen as having considerable room for improvement compared to three years ago [6] - The long-term effects of the new game licenses on market performance are yet to be fully realized, as the development and launch process can take several months to a year [6]

Investment Rating - The industry investment rating is "Outperform the Market," indicating a projected increase of over 10% in the industry index relative to the broader market within the next six months [9]. Core Insights - The report highlights that the issuance of game licenses remains high, with 127 domestic games and 7 imported games approved in July 2025. This reflects a robust supply side and a stable trend towards normalization in license issuance [2][7]. - Key titles that received approval include "Kingshot" by Diandian Interactive, which is expected to leverage its success in overseas markets to become a significant product in the domestic SLG (Simulation and Strategy Game) sector [2][3]. - Tencent's "The Finals," a PC-based FPS game, is also noted for its potential to become a dark horse in the FPS market, given its unique gameplay and adaptation for domestic players [3]. - The report emphasizes the strong performance of established IPs like "Diablo IV" and "Marvel's Secret Wars," which are anticipated to perform well in the domestic market due to their established fan bases and innovative gameplay mechanics [4][7]. Summary by Sections Industry Events - In July 2025, the National Press and Publication Administration announced the approval of 127 domestic games and 7 imported games, maintaining a high issuance rate [1][2]. Investment Highlights - The report indicates that 884 domestic games have been approved year-to-date, with July's approvals slightly down from June but still at a high level. Notable titles include "Kingshot," "The Finals," and "Diablo IV" [2][4]. - The report suggests that the gaming industry is on a recovery path, with a consistent release of licenses and a focus on diverse product offerings from leading companies [7]. Company-Specific Insights - Diandian Interactive's "Kingshot" is highlighted for its innovative gameplay that combines tower defense and simulation elements, aiming to cater to domestic players' preferences [2]. - Tencent's adaptation of "The Finals" is expected to enhance player experience through new modes and anti-cheat systems, positioning it well in the competitive FPS market [3]. - "Marvel's Secret Wars" is noted for its unique blend of strategy card and chess elements, leveraging its strong IP to attract players [4][7].

Market Overview - On July 23, both the Hong Kong Hang Seng Index and the A-share Shanghai Composite Index rose, with the former stabilizing above 25,500 points, reaching a new high since November 2021, while the latter touched the critical 3,600 points [2] - The gaming sector in Hong Kong saw significant capital inflow, rising by 4%, with Tencent (00700.HK) being the largest contributor, increasing by 4.94% to HKD 552.0 per share, marking a new high since June 2021 [2][3] Company Performance - Tencent's stock performance was notable, with a significant increase in market capitalization, while other gaming stocks like Kingsoft (03888.HK), NetEase (09999.HK), Bilibili (09626.HK), and Xindong Company (02400.HK) also saw gains of 3.89%, 2.59%, 2.33%, and 1.56% respectively [2][3] - Flying Fish Technology (01022.HK) experienced the highest single-day increase of 49.15% following a profit announcement, projecting a net profit of approximately RMB 55 million to 70 million for the first half of 2025, compared to a loss of RMB 2 million in the same period last year [3][7] A-share Market - In the A-share market, the gaming sector also performed well, with ST Huatuo (002602.SZ) rising by 4.22%, and other companies like Gigabit (603444.SH) and 37 Interactive Entertainment (002555.SZ) also recording gains [4] Regulatory Environment - The National Press and Publication Administration approved 127 domestic games and 7 imported games in July, contributing to the positive sentiment in the gaming sector [5] - Notable approvals included Tencent's "Summon Adventure" and NetEase's "Diablo IV," indicating a steady release of new content in the market [5] Industry Trends - Analysts noted a solidifying trend of regular game approvals, coupled with domestic gaming innovations, suggesting a recovery in the industry's growth pace [6] - The summer season is a critical period for game developers, with many launching new titles aimed at enhancing player engagement through strong narratives and social elements [6] Financial Outlook - Market expectations for Tencent's Q2 2025 revenue and gross profit are optimistic, with projected year-on-year growth of 12% and 17% respectively, driven by an 18% increase in online gaming revenue [7] - HSBC forecasts NetEase's Q2 performance to be stable, with an expected revenue growth of 11%, supported by a significant increase in PC game revenue [8] - Analysts express a positive outlook for the gaming sector, citing improvements in supply and the emergence of quality content, alongside the impact of AI technology on cost reduction and efficiency [8]