Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [4]. Core Views - The company is a leading player in the commercial gaming and amusement equipment sector, with a robust business model that includes the sale of gaming equipment and anime IP derivatives. The company is expected to leverage the popularity of the "IP Guzi" to create a second growth curve [4][5]. - The forecasted net profits for the company from 2025 to 2027 are projected to be 112 million, 170 million, and 222 million yuan respectively, with corresponding EPS of 0.76, 1.16, and 1.51 yuan. The current stock price corresponds to PE ratios of 36.8, 24.1, and 18.5 times for the respective years [4]. Company Overview - The company has established itself as a leader in the domestic commercial gaming and amusement equipment market, with a complete industry chain that includes the development, production, sales, and operation of gaming equipment [14][15]. - The company has a concentrated shareholding structure, with the founder holding a significant portion of shares [16][18]. Financial Analysis - The company has shown a steady increase in revenue, with total revenue projected to grow from 816 million yuan in 2023 to 1.180 billion yuan in 2025, reflecting a year-on-year growth rate of 35.0% and 16.0% respectively [22]. - The gross profit margin is expected to improve from 28.5% in 2023 to 31.1% in 2025, indicating a positive trend in profitability [22]. Industry Insights - The IP card game industry is experiencing rapid growth, with the market size expected to reach 165 billion yuan in 2024 and 310 billion yuan by 2027, reflecting a CAGR of 20.5% from 2022 to 2027 [5][44]. - The gaming and amusement equipment market is stabilizing, with a revenue of 154.7 billion yuan in 2023, and the market is expected to see increased concentration as companies with strong sales channels gain market share [5][44]. Competitive Advantages - The company has a strong channel advantage, having built extensive downstream sales channels over the years, which enhances its market position [6][62]. - The company collaborates with numerous high-value IPs, including partnerships with major brands like Ultraman and Pokémon, which enriches its product matrix [6][64]. Growth Drivers - The company is expanding its IP derivative business through a combination of cooperation and self-research, with plans to launch new card arcade products and enhance its online and offline sales channels [6][4]. - The company is also exploring XR technology and international markets, which could further open up commercial opportunities [6][4].

Core Viewpoint - Guangzhou Wah Li Technology Co., Ltd. is proceeding with a simplified procedure for issuing shares to specific investors, with a total fundraising amount not exceeding 300 million RMB, which is within 20% of the company's net assets as of the end of the previous year [10][14]. Group 1: Issuance Details - The issuance will be conducted through a non-public offering to no more than 35 specific investors, including qualified institutional investors and other eligible entities [15][16]. - The pricing for the shares is set at 24.21 RMB per share, determined through a competitive bidding process [16]. - The shares acquired by the investors will be subject to a six-month lock-up period post-issuance [16]. Group 2: Approval and Authorization - The board of directors and the annual general meeting of shareholders have authorized the issuance, ensuring compliance with relevant laws and regulations [10][11]. - The issuance requires approval from the Shenzhen Stock Exchange and must be registered with the China Securities Regulatory Commission [10][11]. Group 3: Company Background - Guangzhou Wah Li Technology was established on September 2, 2015, and is a publicly listed company on the Shenzhen Stock Exchange since June 17, 2021 [11][12]. - The company is legally established and in good standing, with no ongoing legal issues that would affect its ability to issue shares [12]. Group 4: Use of Proceeds - The funds raised will be allocated to projects related to "animation card equipment deployment and operation" and to supplement working capital [14][15]. - The use of proceeds complies with national industrial policies and relevant legal regulations [14].

Core Viewpoint - Guangzhou Wahlap Technology Corporation Limited is planning to issue shares through a simplified procedure to specific investors, aiming to raise funds for business expansion and operational enhancement [2][11]. Company Basic Information - Company Name: Guangzhou Wahlap Technology Corporation Limited - Stock Code: 301011 - Established: August 20, 2010, as a limited company; September 2, 2015, as a joint-stock company - Registered Capital: 146.69 million yuan [3][4]. Main Business - The company primarily engages in the design, research and development, production, sales, and operation of gaming and amusement equipment, with a strategic goal of becoming a world-class cultural entertainment enterprise [3][20]. Financial Data - Total Assets as of March 31, 2025: 1,300.97 million yuan - Total Liabilities as of March 31, 2025: 538.99 million yuan - Total Equity as of March 31, 2025: 761.97 million yuan - Revenue for Q1 2025: 185.01 million yuan, with a net profit of 11.43 million yuan [4][6][7]. Financial Indicators - Operating Profit for 2024: 101.75 million yuan, with a net profit of 84.65 million yuan - Cash Flow from Operating Activities for Q1 2025: -64.50 million yuan - Current Ratio as of March 31, 2025: 1.74, indicating liquidity [6][7][8]. Fundraising and Use of Proceeds - The company plans to raise approximately 148.60 million yuan through the issuance of 6,137,959 shares at a price of 24.21 yuan per share, with proceeds allocated to projects related to the main business and working capital [11][12][14]. Risk Factors - The company faces several risks, including industry policy changes, exchange rate fluctuations, intensified market competition, and potential impacts from macroeconomic conditions [5][7][9].

Core Viewpoint - The company is taking measures to address the potential dilution of immediate returns due to its upcoming stock issuance, ensuring that small and medium investors are informed and their interests are protected [1][2][4]. Financial Impact Analysis - The total amount to be raised from the issuance is 148.6 million yuan, with an estimated issuance of 6,137,959 shares, increasing the total share capital to 152,829,959 shares [1][2]. - The projected net profit for 2024 is 84.65 million yuan, with a net profit of 83.20 million yuan after excluding non-recurring gains and losses [1][2]. - Three scenarios for 2025 net profit calculations are provided: 1. No change from 2024 2. A 20% increase from 2024 3. A 20% decrease from 2024 [3][4]. Earnings Per Share (EPS) Projections - Under the assumption of no change in net profit, the basic and diluted EPS would decrease from 0.58 yuan to 0.57 yuan post-issuance [3]. - If net profit increases by 20%, the EPS would rise to 0.68 yuan [3]. - If net profit decreases by 20%, the EPS would drop to 0.46 yuan [3]. Company’s Business and Market Position - The company specializes in the design, research and development, production, sales, and operation of indoor commercial gaming equipment, establishing a complete industrial chain advantage [5][6]. - The management team has over 35 years of industry experience, contributing to a strong brand image and competitive advantages in product development and market resources [5][6]. - The company aims to enhance its product offerings and market presence through the issuance, particularly focusing on anime card devices [5][7]. Commitment to Shareholder Returns - The company has outlined specific measures to mitigate the dilution of immediate returns, including enhancing project execution, improving governance, and adhering to dividend policies [8][9]. - A three-year shareholder return plan (2025-2027) has been established to clarify profit distribution principles and ensure the protection of shareholder interests [10]. Commitment from Company Executives - Company executives have made commitments to uphold the measures designed to mitigate the dilution of immediate returns, ensuring no unfair benefit is provided to others at the company's expense [11][12].

Group 1 - The company plans to raise funds of 148.6 million yuan through a simplified procedure for a specific audience, with a total investment of 189.29 million yuan allocated for various projects [1][4][6] - The gaming and amusement equipment industry is expected to enter a phase of high-quality development driven by policy support and market demand [2][3] - The company aims to enhance its market and resource advantages, strengthen core competitiveness, and optimize its capital structure through this fundraising [4][5][20] Group 2 - The issuance of shares is necessary to meet the funding needs of the company's future business development and to reduce financial risks [5][6][19] - The company has a complete supply system in the upstream industry and a competitive landscape in the downstream industry, which supports its growth [5][20] - The company has a strong management team with over 35 years of industry experience, which contributes to its competitive edge in product development and market presence [4][20] Group 3 - The company will utilize the raised funds for the deployment of anime card equipment and to supplement working capital, which will enhance its innovation capabilities and operational efficiency [6][20][23] - The company has established a solid talent pool and technical reserves, with over 80 technical personnel and a focus on integrating advanced technologies into its products [21][22] - The company is committed to maintaining a fair and reasonable issuance process, ensuring that the interests of all shareholders, especially minority shareholders, are protected [15][24]

Core Viewpoint - Guangzhou Wahlap Technology Corporation Limited plans to issue shares to specific investors through a simplified procedure, aiming to raise funds for enhancing its market position and product offerings in the gaming and entertainment equipment industry [2][12][17]. Group 1: Issuance Details - The company intends to raise a total of RMB 148.6 million (approximately USD 21.2 million) through this issuance, which will not exceed 20% of its net assets as of the end of the previous year [3][21]. - The issuance price is set at RMB 24.21 per share, based on the average stock price over the previous 20 trading days [4][19]. - The total number of shares to be issued is 6,137,959, which is within the limit of 30% of the company's total share capital prior to the issuance [21][23]. Group 2: Purpose of Fundraising - The funds raised will be allocated to various projects, with a total investment of RMB 189.29 million (approximately USD 27.1 million), of which RMB 148.6 million will be funded through this issuance [22][26]. - A significant portion of the funds will be directed towards increasing the deployment of anime card devices, enhancing market coverage, and optimizing operational capabilities [27][30]. - The company aims to strengthen its competitive position in the industry by leveraging the funds to improve product offerings and expand its market presence [12][15]. Group 3: Industry Context - The gaming and entertainment equipment industry is experiencing growth driven by rising consumer spending on cultural and entertainment activities, alongside supportive government policies [12][13]. - The industry is transitioning towards high-quality development, with a focus on integrating technology and interactive experiences into entertainment offerings [15][28]. - The company is positioned to capitalize on these trends by enhancing its product lines and operational capabilities, particularly in the anime and gaming sectors [29][30].