Investment Rating - The report initiates coverage with a "Buy" rating for the company [8][3]. Core Insights - The report emphasizes the "Content + Platform" flywheel effect, highlighting the growth potential of the TapTap platform and the company's self-developed games [7][10]. - The company is expected to achieve significant revenue growth, with projected revenues of 64.31 billion, 79.27 billion, and 90.59 billion RMB for 2025-2027, representing year-on-year growth rates of 28%, 23%, and 14% respectively [8][3]. - Adjusted net profits are forecasted to be 17.02 billion, 22.26 billion, and 27.60 billion RMB for the same period, with growth rates of 94%, 31%, and 24% respectively [8][3]. Financial Data and Profit Forecast - Revenue projections for the company are as follows: - 2023: 3,389 million RMB - 2024: 5,012 million RMB - 2025E: 6,431 million RMB - 2026E: 7,927 million RMB - 2027E: 9,059 million RMB - Year-on-year growth rates for revenue are projected at -1%, 48%, 28%, 23%, and 14% respectively [6]. - Adjusted net profit forecasts are: - 2023: -34 million RMB - 2024: 877 million RMB - 2025E: 1,702 million RMB - 2026E: 2,226 million RMB - 2027E: 2,760 million RMB - Year-on-year growth rates for net profit are projected at 93%, 2670%, 94%, 31%, and 24% respectively [6]. Market Dynamics - The gaming industry is experiencing a recovery in license issuance, with a total of 1,195 licenses issued in the first nine months of 2025, a year-on-year increase of 25% [11][31]. - The report notes that TapTap is becoming an increasingly important channel for game promotion, with its online promotion service revenue reaching 976 million RMB in the first half of 2025, capturing approximately 3.27% of the mobile game advertising market [7][23]. - The growth of TapTap is driven by improvements in domestic licensing, advancements in self-developed games, and strategic expansions into PC and international markets [11][30]. Competitive Advantage - TapTap's low revenue-sharing model (maximum 5% for paid games and free-to-play games incur no fees) is highlighted as a significant advantage for attracting developers, especially independent and small developers [25][10]. - The platform has established a strong community and content ecosystem, differentiating itself from traditional app stores and social media platforms [10][25]. - The report suggests that the market has not fully recognized the value and potential of the TapTap platform, which is well-positioned to capitalize on the evolving gaming landscape [10][11].

Investment Rating - The report initiates coverage with a "Buy" rating for the company [3][8]. Core Insights - The report emphasizes the "Content + Platform" flywheel effect, highlighting the value of the TapTap platform and the company's self-developed games [7][10]. - The gaming industry is experiencing a recovery in license supply, which, combined with changes in distribution channels, positions TapTap as a significant promotional channel for games [20][27]. - The company's self-developed game capabilities are gradually being validated, with successful titles contributing to revenue growth [51]. Financial Data and Profitability Forecast - Revenue projections for the company are as follows: 2025E at 6,431 million RMB, 2026E at 7,927 million RMB, and 2027E at 9,059 million RMB, with year-on-year growth rates of 28%, 23%, and 14% respectively [6][8]. - Adjusted net profit attributable to ordinary shareholders is forecasted to be 1,702 million RMB in 2025E, 2,226 million RMB in 2026E, and 2,760 million RMB in 2027E, with significant growth rates of 94%, 31%, and 24% respectively [6][8]. - The report employs the SOTP valuation method, estimating the company's market value at 549 billion HKD [8]. TapTap Business Growth Drivers - The growth of TapTap is driven by an increase in domestic game licenses, advancements in self-developed games, and expansion into PC and international markets [9][35]. - The platform has established a developer-user flywheel effect, with over 240,000 developers and 300,000 games launched, leading to a significant increase in monthly active users (MAU) [35][41]. - The report anticipates that TapTap's advertising revenue could exceed 5 billion RMB by 2030, driven by user growth and improved monetization strategies [11][49]. Self-Developed Game Capabilities - The company has successfully adjusted its product cycle since 2024, focusing on strong game categories and validating its strategic direction [51]. - Upcoming titles such as "伊瑟" and "心动小镇" are expected to contribute positively to the company's pipeline and revenue [51][40].

Investment Rating - The investment rating for the company is "Buy" and is maintained [6]. Core Views - The company has released its mid-year performance forecast for 2025, indicating a revenue of no less than 3.05 billion (approximately +37% year-on-year) and a net profit of no less than 790 million (approximately +215% year-on-year), exceeding expectations [2][4]. - The strong performance of self-developed games and the continued growth trend of TapTap are key drivers for the company's success [2][4]. - The company has a promising pipeline of new games and is expanding its community platform, which is expected to contribute to future growth [2]. Summary by Sections Performance Forecast - The company forecasts a revenue of at least 3.05 billion for the first half of 2025, reflecting a year-on-year increase of about 37% [2][4]. - The net profit is projected to be at least 790 million, representing a year-on-year increase of approximately 215% [2][4]. Game Development and Community Growth - Self-developed games such as "Ragnarok M: Beginner's Server," "Heart Town," and "Torchlight: Infinite" have shown strong performance, boosting revenue and gross margin [7]. - TapTap's monthly active users (MAU) remain stable year-on-year, with improvements in advertising algorithms and user engagement driving revenue and profit growth [7]. - The company has successfully launched new games, with "Heart Town" achieving a top 10 ranking in sales and "Etheria: Restart" entering the top 50 in the U.S. sales chart [7]. Strategic Investments - The company is expanding its game portfolio by acquiring a 5.3% stake in MiAO for 14 million USD, a startup founded by the former CEO of Giant, which has expertise in social games [7].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1][4][11] Core Views - The company is expected to see significant growth driven by new and existing games, as well as the TapTap platform, with a projected revenue of at least 3.05 billion yuan for H1 2025, representing a year-on-year increase of approximately 37% [4][8] - Net profit is anticipated to be no less than 790 million yuan, reflecting a year-on-year growth of around 215%, exceeding previous expectations [4][8] - The performance boost is attributed to successful self-developed games and improvements in the TapTap platform's advertising algorithms and user engagement [4][5] Financial Summary and Valuation Metrics - Revenue projections for 2025 are set at 6.466 billion yuan, with a year-on-year growth of 29% [7] - Net profit for 2025 is estimated at 1.71 billion yuan, showing a year-on-year increase of 110.7% [7] - The company’s gross margin is expected to improve to 71% in 2025, while the net margin is projected at 26.4% [7] - Earnings per share (EPS) for 2025 is forecasted at 3.5 yuan, with a price-to-earnings (P/E) ratio of 15.0 times [7]