Core Viewpoint - Maoyan Entertainment is expected to recover significantly in 2025, driven by improvements in the domestic film industry and the introduction of its first dividend payment, leading to increased profit forecasts for the coming years [1][2]. Group 1: Revenue Drivers - The primary revenue driver for Maoyan is the total box office in mainland China, with domestic blockbuster films accounting for about 80% of the box office [1]. - The box office for the 2025 spring festival season reached a historical high of RMB16.05 billion, indicating a strong recovery in the film industry [1]. - The online entertainment ticketing services experienced a revenue decline of 14.4% year-on-year in 2024, totaling RMB1,932 million, but is expected to recover in 2025 due to an improved movie roster and influx of foreign artists [2]. - The entertainment content services also saw a revenue decline of 15.3% year-on-year, totaling RMB1,949 million, but will benefit from the recovery of the domestic film industry [3]. Group 2: Profit Forecasts - The forecasts for the Company's shareholders' net profit for 2025-2027 have been increased to RMB751 million, RMB976 million, and RMB1,066 million, respectively [1]. - Adjusted shareholders' net profit forecasts for the same period have also been raised to RMB870 million, RMB1,095 million, and RMB1,185 million, respectively [1]. - The Company anticipates a dividend payout of approximately 35% of earnings over the next three years, with a yield of around 4-5% [1]. Group 3: Market Expansion - Maoyan achieved record revenue and GMV growth in 2024, including a 90% year-on-year increase in concerts GMV, while serving top domestic and international artists [2]. - The Company has strengthened its presence in Hong Kong, China, and Macau through its self-operated platform UUTIX and established partnerships in regions like Southeast Asia, the Middle East, and Latin America, facilitating further overseas expansion [2]. - The Company is involved in the production and distribution of several domestic blockbuster films expected to perform well at the box office in 2025, including titles like Honey Money Phony and Detective Chinatown 1900 [3].

Core Viewpoint - The company's 2024 performance is in line with expectations, with a significant decline in both revenue and net profit, but a potential recovery in ticket sales is anticipated for 2025 [1][2]. Financial Performance - The company reported a revenue of 4.08 billion yuan for 2024, a year-on-year decrease of 14.2%, falling within the forecast range of 4.05 to 4.15 billion yuan [1]. - Net profit for 2024 was 180 million yuan, down 80.0% year-on-year, also within the forecast range of 150 to 200 million yuan [1]. - Non-IFRS net profit was 310 million yuan, aligning with expectations [1]. Industry Trends - The main business is expected to decline in 2024 due to market pressures, with a focus on the recovery trend of ticket sales [1]. - The forecast for the 2025 film box office is 55 billion yuan, suggesting a potential recovery in ticket sales revenue of 25% to 30% year-on-year [1]. - The average ticket price increase and the performance of imported films may impact this recovery [1]. - The live performance ticketing sector is projected to grow by 15.4% year-on-year in 2024, with an expected industry growth rate of over 10% in 2025 [1]. Content Production - The company has a rich pipeline of films, with 63 domestic films produced in 2024, indicating a strong selection and data capability [2]. - Key films to watch include "The Lychee of Chang'an" and others scheduled for release in 2024, which may provide profit elasticity [2]. Shareholder Returns - The company announced its first dividend, proposing a final dividend of 0.32 HKD per share for the year ending December 31, 2024, with a dividend yield exceeding 4% based on the closing price [3]. - A three-year dividend plan aims to distribute at least 20% of net profit each fiscal year, reflecting a commitment to shareholder returns [3]. - The total amount for dividends and buybacks in 2024 is expected to account for 50% of retained earnings [3]. Profit Forecast and Valuation - Due to pressure on actual ticket sales and a rigid recovery in gross margins, the Non-IFRS net profit forecasts for 2025 and 2026 have been reduced by 32.9% and 31.6% to 695 million and 802 million yuan, respectively [3]. - The current price corresponds to 11.9 and 10.2 times Non-IFRS P/E for 2025 and 2026 [3]. - The target price is maintained at 10.2 HKD, suggesting a 33.0% upside potential based on the adjusted profit forecasts and improving content supply in the industry [3].