Investment Rating - The report assigns a "Buy" rating for Century Huatong (002602.SZ) for the first time [1]. Core Insights - Century Huatong has transformed from an automotive parts manufacturer to a leading player in the internet gaming sector, achieving record-high performance in 2025 with revenue of 27.22 billion yuan, a year-on-year increase of 75.30% [6][19]. - The company's net profit for the first three quarters of 2025 reached 4.36 billion yuan, reflecting a 142% increase compared to the same period in 2024, indicating improved profitability efficiency [6][19]. - The revenue structure has shifted significantly, with mobile games accounting for 84.7% of total revenue in the first half of 2025, and overseas revenue surpassing domestic revenue for the first time, reaching 52.06% [6][27]. Financial Performance Summary - Revenue (in million yuan): - 2023A: 13,285 - 2024A: 22,620 - 2025E: 38,204 - 2026E: 48,799 - 2027E: 53,679 - Year-on-year growth rates: - 2023A: 16% - 2024A: 70% - 2025E: 69% - 2026E: 28% - 2027E: 10% [1] - Net profit (in million yuan): - 2023A: 524 - 2024A: 1,213 - 2025E: 5,721 - 2026E: 7,988 - 2027E: 9,755 - Year-on-year growth rates: - 2023A: 108% - 2024A: 132% - 2025E: 372% - 2026E: 40% - 2027E: 22% [1] Business Development - Century Huatong has undergone three phases of evolution, transitioning from automotive parts to internet gaming, and has successfully lifted risk warnings, marking a new development stage [12][14]. - The subsidiary, Diandian Interactive, has become a core growth engine, with revenue increasing from 3.74 billion yuan in 2022 to 14.96 billion yuan in 2024, and accounting for 76% of the group's total revenue in the first half of 2025 [6][70]. - The company has consistently launched successful new products, with titles like "Endless Winter" and "Kingshot" achieving significant market recognition and revenue [6][73]. Market Trends - The Chinese gaming market is recovering, with total sales revenue expected to reach 350.79 billion yuan in 2025, reflecting a year-on-year growth of 7.68% [28]. - The user base for gaming in China is projected to reach 683 million by 2025, providing a solid foundation for revenue growth [29]. - The mobile gaming segment dominates the market, accounting for 73.29% of total revenue, while client games follow with a 22.28% share [31].

业务层面，世纪华通构建起核心IP焕新与海外爆款引领的双轮驱动格局，成效显著。其中，作为国内业 务"压舱石"的盛趣游戏，持续深耕长青IP发展，2025年推出的《传奇新百区-盟重神兵》《龙之谷世 界》等"端改手"IP产品，精准契合市场需求，收获玩家广泛认可；同时，《传奇世界》《彩虹岛》《永 恒之塔》等核心IP的多端互通版本正加速研发，为后续增长储备充足动能。在私域流量运营领域，盛趣 游戏同样成效突出，通过直播、社群运营等多元举措持续激活存量用户，为进一步深挖IP价值奠定了坚 实基础。 海外市场布局上，世纪华通持续彰显领跑实力。爆款产品《Whiteout Survival》延续了2024年的优异表 现，不仅在SLG赛道上持续领跑，还稳居全球手游收入榜第4位，较上年排名上升4位，成功跻身10亿美 元收入梯队并成为该梯队增长冠军。此外，公司全新上线的策略手游《Kingshot》快速崛起，成功跻身 2025年全球手游收入榜第14位，成为年度唯一上榜的新游，与《Whiteout Survival》协同发力，彰显了 世纪华通在全球手游赛道的核心竞争力。 此次摘得4项"金茶奖"大奖，是行业对世纪华通2025年综合实力与发展成就 ...

Core Insights - Century Huatong, a leading player in the A-share gaming industry, has released its annual "Top Ten News" for 2025, showcasing its business layout, AI strategy, and ESG achievements, presenting a clear blueprint for high-quality development [1] Group 1: Sustainable Development and ESG - The company emphasizes sustainable development, placing internal construction and ESG at the forefront of its annual news, reflecting its commitment to integrating social responsibility with internal governance [2][6] - Notable public welfare projects such as "Little Child Governance," "From the Mountains," "How Games are Made," and "Green Computer Classrooms" have been implemented, enhancing the company's long-term trust value [2][6] Group 2: Domestic Business and IP Development - Domestic operations serve as a cornerstone for stable growth, with the "Street Basketball" event by Tianyou Software having reached nearly 200 million viewers over 20 years [3][8] - The company has built a competitive product structure around evergreen IPs, with classic games like "MapleStory," "Eternal Tower," and "Legend World" contributing steadily to performance [3][8] - New projects such as "Classic Rainbow Island" and "Eternal Tower" mobile games are accelerating development to support robust growth in 2026 [3][8] Group 3: Global Expansion - The company's overseas business has seen significant breakthroughs, with Century Games ranking first in the "2025 Global TOP 50 Mobile Game Companies," achieving record growth speed [4][9] - Key products like "Whiteout Survival" have topped global mobile game revenue charts, while "Kingshot" has secured the top two positions in China's mobile game export revenue [4][9] Group 4: AI Strategy - The company has initiated a comprehensive AI strategy, launched by Chairman Wang Ji in July, focusing on process reengineering, business upgrades, talent acquisition, and strategic advancement [5][10] - The "Dragon Cup" global AI game and application innovation competition aims to enhance the company's brand influence in the AI sector and accelerate the acquisition of key technologies and quality teams [5][10] - Looking ahead to 2026, the company plans to establish its presence in the Shanghai Technology Innovation Building, continuing to deepen its AI strategy and expand its global market boundaries [5][10]

深圳，2025年12月5日——在今日举行的第十届金陀螺奖颁奖典礼上，世纪华通（维权）及其旗下业务单元再次成为焦点，一举摘得四项行业重磅奖项。 其中，世纪华通获评"年度影响力游戏企业奖"，旗下Century Games荣获"年度优秀出海企业奖"；产品方面，《奔奔王国》获"年度风云小游戏奖"，《龙之 谷世界》获"年度风云移动游戏奖"。这标志着公司已连续多年在该奖项评选中取得卓越成绩，持续获得行业高度认可。 金陀螺奖作为中国泛TMT领域最具专业影响力的综合性奖项之一，以其强大的专家评审团、完善的评审机制与流程著称，奖项权威性已成为行业风向 标。本届奖项涵盖游戏、XR、电竞三大板块，吸引业内众多顶尖企业参与角逐。世纪华通能够在如此激烈的竞争中多点开花，不仅是单个产品或业务的 胜利，更是系统化竞争力和战略前瞻性的集中体现。 多元产品矩阵协同发力 内外兼修彰显实力 细分赛道表现亮眼 本次获奖的两款产品，分别代表公司在轻量化与精品化两大方向的战略落地，验证了其覆盖广泛用户群体、驾驭多品类研发与运营的能力。 《奔奔王国》 荣获"年度风云小游戏奖"的《奔奔王国》，自今年8月28日上线微信小程序后，凭借其创新的玩法设计与出色的用 ...

Core Insights - Century Huatong has been nominated for three awards in the 2025 Game Top Ten Annual List, recognizing its achievements in the gaming industry [1][4][6] Group 1: Awards and Nominations - Century Huatong received the nomination for "2025 Excellent 'Going Global' Game Enterprise" due to its outstanding performance in the game export sector [4][8] - Shengqu Games, a subsidiary of Century Huatong, was nominated for "2025 Excellent Game Operation Enterprise" for its strong operational capabilities and focus on classic IPs [5][9] - The mobile game "Endless Winter," developed by DotDot Interactive, was nominated for "2025 Excellent Mobile Game," highlighting its unique product appeal and market performance [1][6] Group 2: Market Performance - Century Huatong's new game "Kingshot" has achieved significant market success, ranking first in the iOS free game charts in multiple regions within four months of its launch [4][8] - The games "Kingshot" and "Whiteout Survival" dominated the Chinese mobile game export revenue rankings, maintaining their top positions for four consecutive months [4][8] - Shengqu Games has successfully revitalized core IPs through new mobile game releases, demonstrating the enduring value and competitiveness of classic IPs in the current market [5][9] Group 3: Industry Trends - The gaming industry is entering a new phase of high-quality development, with competition increasingly focused on content innovation, technology application, and globalization capabilities [5][9] - Century Huatong aims to continue leading the way in promoting the Chinese gaming industry's advancement towards premium and international standards [5][9]

Core Viewpoint - Century Huatong has initiated a share repurchase plan, spending approximately 500 million yuan to buy back 27.43 million shares, reflecting confidence in its future prospects and strong cash flow [1][4][7]. Financial Performance - As of September 2025, Century Huatong reported cash and cash equivalents of 10.195 billion yuan, with interest-bearing liabilities of 2.636 billion yuan, indicating strong financial health [3]. - The company achieved a net profit of 1.213 billion yuan in 2024 and 4.357 billion yuan in the first three quarters of 2025, representing a year-on-year increase of approximately 142% [3][10]. - Revenue for the first three quarters of 2025 reached 27.223 billion yuan, marking a 75.31% increase compared to the previous year [10]. Share Repurchase Plan - The share repurchase plan was announced on November 12, 2025, with a total budget of 500 million to 1 billion yuan, funded by self-owned capital and a special loan [1][5]. - The first repurchase occurred on December 2, 2025, with shares bought at prices ranging from 18.01 to 18.38 yuan, totaling around 500 million yuan [4][8]. - The repurchased shares will be canceled, reducing the company's registered capital [5]. Stock Performance - Century Huatong's stock price has surged approximately 2.6 times from early 2025 to December 1, 2025, with a year-to-date increase of 259.92% [2][8]. - The stock price rose from 5.14 yuan per share at the beginning of 2025 to 22.49 yuan per share by September 26, 2025 [8]. Business Overview - Century Huatong's main business segments include internet gaming, AI cloud data, and automotive parts manufacturing, with internet gaming as the core focus [3][9]. - The company has made significant investments in research and development, with R&D expenditures of 1.78 billion yuan in the first three quarters of 2025, surpassing the total for 2024 [3][10]. - The company aims to become a leading global digital technology firm, leveraging its extensive ecosystem in the gaming industry [9].

Core Viewpoint - Century Huatong has transformed from a financially troubled company to a market-favored "game king" due to its successful mobile game "Whiteout Survival," which has generated over 20 billion yuan in revenue by September 2023 [1][12]. Financial Performance - As of November 13, 2025, Century Huatong's stock price reached 19.17 yuan per share, with a total market capitalization of 142.4 billion yuan, making it the highest valued game company in A-shares [2]. - The company's stock price has increased by 272.96% year-to-date as of November 13, 2025, with a total market value increase of 104.1 billion yuan [3]. - For the first three quarters of 2025, Century Huatong reported revenue of 27.22 billion yuan, surpassing the total revenue of the previous year, and a net profit of 4.36 billion yuan, reflecting a year-on-year growth of 141.65% [11]. Business Transformation - Century Huatong transitioned from an automotive parts manufacturer to a gaming company starting in 2014, acquiring several game companies and significantly increasing its goodwill [5][6]. - The company faced financial risks due to its rapid acquisitions, leading to a significant increase in goodwill from 2 billion yuan in 2017 to 22.05 billion yuan in 2020 [7]. Game Success - "Whiteout Survival," developed by Century Huatong's subsidiary, has become a top performer in both domestic and international markets, achieving over 200 million downloads and generating over 3.5 billion USD (approximately 24.8 billion yuan) in global revenue by September 2023 [12][13]. - The game has maintained a leading position in the Chinese mobile game export revenue rankings for 15 consecutive months and topped the global mobile game revenue chart in March 2023 [12]. Regulatory Issues - Century Huatong was previously penalized for financial misconduct, including false reporting of goodwill and revenue recognition, leading to a significant decline in stock price [4][9]. - The company has since corrected its financial statements for 2018 to 2022 and has faced investor lawsuits totaling approximately 73.16 million yuan [9]. Market Position - Century Huatong has positioned itself as a key player in the gaming industry, leveraging its strong IP portfolio and backing from Tencent to enhance its market presence [13].

Core Viewpoint - Century Huatong Group has successfully removed its risk warning status, leading to a significant increase in its stock price and market capitalization, positioning it as the leading gaming company in the A-share market [1][2]. Financial Performance - As of November 13, 2025, Century Huatong's stock price reached 19.17 yuan per share, with a total market value of 1,424 billion yuan, making it the highest valued gaming company among 23 in the A-share market [1]. - The company's stock has seen a remarkable increase of 272.96% year-to-date as of November 13, 2025, with a total market value increase of 1,041 billion yuan, averaging an increase of 3.29 billion yuan per day [1]. - For the first three quarters of 2025, Century Huatong reported revenues of 272.23 billion yuan, surpassing the total revenue for the previous year, and a net profit of 43.57 billion yuan, reflecting a year-on-year growth of 141.65% [8]. Business Transformation and Risks - Century Huatong transitioned from an automotive parts manufacturer to a gaming company, acquiring several game companies, including a significant acquisition of Shengqu Games for 29.8 billion yuan in 2019 [2][3]. - The company faced financial scrutiny due to past financial misconduct, including false reporting of goodwill and revenue recognition, leading to a warning and a fine of 8 million yuan from the China Securities Regulatory Commission [6][7]. - As of September 30, 2025, the company's goodwill stood at 119.81 billion yuan, accounting for 27.71% of total assets, indicating a slight reduction from 30.88% at the end of 2024, but still posing a risk if subsidiary performance declines [8][9]. Market Position and Product Success - The game "Whiteout Survival," developed by its subsidiary, has been a significant contributor to Century Huatong's revenue growth, achieving over 200 million downloads globally and topping revenue charts [8][9]. - The company has also launched new mobile games and holds several classic IPs, enhancing its market presence and competitiveness [9]. - Century Huatong's sales expenses surged to 105.68 billion yuan in the first three quarters of 2025, a year-on-year increase of 103.40%, reflecting its aggressive marketing strategy to maintain a pipeline of successful games [9].

Core Viewpoint - Century Huatong Group has successfully removed its risk warning status, leading to a significant increase in its stock price and market capitalization, positioning it as the leading gaming company in the A-share market [2][3]. Group 1: Stock Performance and Market Position - After the removal of the risk warning, Century Huatong's stock price rose for two consecutive days, closing at 19.17 yuan per share on November 13, 2025, with a total market value of 142.4 billion yuan [2]. - The stock has seen a remarkable increase of 272.96% year-to-date as of November 13, 2025, with a total market value increase of 104.1 billion yuan [2][8]. - Century Huatong has become the largest gaming company by market capitalization among 23 gaming companies listed in A-shares [2]. Group 2: Financial and Regulatory Background - The company faced financial scrutiny due to false financial reporting from 2018 to 2022, leading to its designation as "ST Huatong" on November 8, 2024 [3][7]. - The company was penalized by the China Securities Regulatory Commission (CSRC) for failing to conduct proper goodwill impairment tests and for other financial misreporting, resulting in a fine of 8 million yuan [7][6]. - As of September 30, 2025, Century Huatong's goodwill stood at 11.981 billion yuan, accounting for 27.71% of total assets, a slight decrease from 30.88% at the end of 2024 [11]. Group 3: Business Transformation and Growth - Century Huatong transitioned from an automotive parts manufacturer to a gaming company starting in 2014, acquiring several gaming firms, including a significant acquisition of Shengqu Games for 29.8 billion yuan in 2019 [3][4]. - The company reported a revenue of 92.76 billion yuan for the first half of 2024, a 53.33% increase year-on-year, and a net profit of 11.58 billion yuan, up 33.41% [8]. - For the first three quarters of 2025, Century Huatong's revenue reached 272.23 billion yuan, surpassing the total revenue for the previous year, with a net profit of 43.57 billion yuan, reflecting a year-on-year growth of 141.65% [9]. Group 4: Key Products and Market Strategy - The success of the game "Whiteout Survival" has been a significant driver of Century Huatong's revenue growth, achieving over 200 million downloads globally and ranking first in overseas mobile game revenue [9][10]. - The company has also launched new mobile games and holds several classic IPs, enhancing its market presence and competitiveness [10]. - To maintain growth, Century Huatong's sales expenses surged to 10.568 billion yuan in the first three quarters of 2025, a 103.40% increase year-on-year [11].

Investment Rating - The report gives a "Strong Buy" investment rating for the company [2]. Core Insights - The company has a strong focus on the gaming industry, particularly in SLG (Simulation and Strategy Games) and classic IPs, and has innovatively opened the "SLG+X" gaming track, leading to significant revenue growth [1][8]. - The company has successfully launched hit products like "Endless Winter" and "Bouncing Kingdom," which have topped various app store charts, showcasing its strong product replication capabilities [1][8]. - The company has achieved a significant turnaround, with a notable increase in revenue and profit margins, driven by its subsidiary, Point Interactive, which has seen explosive growth in both domestic and overseas markets [6][27]. Company Overview - The company has transitioned from automotive parts to the internet gaming industry, acquiring key players like Point Interactive and Shengqu Games to establish a dual-driven operational model [16][18]. - The company has diversified its business into AI and cloud data services, alongside its core gaming operations, enhancing its technological capabilities [16][18]. Financial Performance - In 2024, the company achieved total revenue of 22.62 billion yuan, a year-on-year increase of 70.27%, and a net profit of 1.213 billion yuan, up 131.51% [6][27]. - For the first half of 2025, the company reported revenue of 17.207 billion yuan and a net profit of 2.656 billion yuan, reflecting year-on-year growth of 85.50% and 129.33%, respectively [6][27]. - The company's revenue from gaming has surpassed 90% of total revenue, indicating a strong focus on this segment [30]. Market Dynamics - The global mobile gaming market is shifting from user growth to value-driven consumption, with significant revenue growth expected in the coming years [41][51]. - The Chinese gaming market has reached new highs in revenue and user numbers, with a total sales revenue of 168 billion yuan in the first half of 2025, marking a 14.08% increase year-on-year [41][46]. Strategic Positioning - The company has established a robust overseas presence, with its games achieving significant sales in key markets such as the United States, Japan, and South Korea [48]. - The partnership with Tencent, which holds a 10% stake in the company, enhances its operational capabilities and market reach [6][16].