Group 1: Licensing and Partnerships - The company signed a licensing agreement with Tianqiong Interactive for the exclusive development, operation, and promotion of products focused on the Legend IP [1] - Sanjiu Interactive will pay 100 million yuan annually for showcasing and promoting its games in the Legend Box [1] - Tanwan Games will pay 200 million yuan to establish a star brand area within the Legend Box for game promotion and live streaming [1] - Zhangwan Games will pay 150 million yuan for a brand area in the Legend Box for game promotion and live streaming [1] Group 2: New Game Releases - The public beta for "Ragnarok: The Promised Adventure" has begun, with several new games like "Three Kingdoms: The Return of the World," "Tomb Raider: The Journey," and "Douluo Continent: The Evil Legend" expected to launch soon, driving revenue growth [2] Group 3: AI Strategy Implementation - The company launched an AI development platform called "SOON," which has received strategic investments from companies like Bigo Group and Hengdian Capital [3] - The platform divides game generation into three core elements: art assets, code creation, and numerical design, enabling collaborative AI generation [3] - The company invested in EVE, a 3D AI companion application, aiming to create deep emotional connections with users, set to launch in 2025 [3] - The company introduced a healing AI brand "Warm Star Valley Dream Journey," targeting emotional companionship for ages 12-35, with plans to launch in 2025 [3] Group 4: Profit Forecast Adjustments - The company maintains its net profit forecast for 2025 at 2.04 billion yuan and raises the 2026 forecast to 2.531 billion yuan from the previous 2.348 billion yuan [4] - A new net profit forecast of 2.838 billion yuan for 2027 has been added, with corresponding PE ratios for 2025-2027 at 30x, 24x, and 22x respectively [4] - The company maintains a "Buy" rating [4]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The future of the Legend Box is promising, with a licensing agreement signed between the company's subsidiary and Tianqiong Interactive for exclusive development and operation of Legend-themed products [4] - The company is set to launch new game products, including "Ragnarok: The Promised Adventure," which is expected to drive revenue growth [6] - The AI strategy is accelerating, with the introduction of an AI development platform and investments in AI applications aimed at enhancing user experience and engagement [6] Financial Data and Profit Forecast - Total revenue is projected to reach 5,221 million yuan in 2025, with a year-on-year growth rate of 2.0% [5] - The net profit attributable to the parent company is expected to be 2,040 million yuan in 2025, reflecting a year-on-year growth of 25.3% [5] - Earnings per share are forecasted to be 0.95 yuan in 2025, with a projected PE ratio of 30 [5] - The company has adjusted its profit forecasts, maintaining the 2025 net profit estimate at 2,040 million yuan and increasing the 2026 estimate to 2,531 million yuan [6]

Competitive Advantages - The company focuses on the core strategy of "focusing on the gaming industry," aiming to create high-quality games that meet market demands, supported by a business system of "R&D, publishing, investment + IP" [2] - The company has established an overseas publishing strategy, leading to a continuous increase in overseas revenue over the past three years [2][4] Overseas Business Performance - In 2023, overseas revenue reached 117 million CNY, accounting for 2.71% of total revenue, with a year-on-year growth of 619.54% [4] - In 2024, overseas revenue is projected to be 375 million CNY, representing 7.32% of total revenue, with a year-on-year growth of 221.48% [4] - In the first half of 2025, overseas revenue was 202 million CNY, making up 7.82% of total revenue, with a year-on-year growth of 59.57% [4] Successful Overseas Products - The game "Monster Alliance" launched on March 25, 2025, quickly rose to Top 2 on the App Store free chart in South Korea [5] - "MU Immortal," launched on May 20, 2025, topped the iOS RPG free chart in multiple countries on its release day [5] - "Party Beast Control," launched on May 22, 2025, achieved first place in iOS downloads in Hong Kong and Taiwan on its launch day [6] Information Service Revenue - Information service revenue includes income from game resource distribution, community services, and promotional services, totaling 657 million CNY in the first half of 2025 [7] Unique Features of Legend Box - Legend Box is a vertical community platform focused on the needs of "Legend" game users, integrating game experience, community interaction, and live streaming [8] New Developments in Legend Box - In July 2025, a licensing agreement was signed for "Legend" and "Legend World," allowing for exclusive development and operation of related products [10] - Over 25 high-quality "Legend" games have been integrated into Legend Box, with plans to introduce over 100 more [10] Shareholder Information - As of September 10, 2025, the total number of shareholders is 53,848, showing a recent overall decrease [10] Arbitration and Financial Impact - The company won an arbitration case against Yumeide, but cannot confirm income from the receivable until the payment situation is clear [11] - The increase in the stock price of Century Huatong will enhance the company's net assets but will not affect current profits [12] Commitment to Shareholder Value - The major shareholder and executives have committed to using dividends for share buybacks from 2024 to 2028, with significant amounts already invested [13]

Summary of the Gaming Industry Conference Call Industry Overview - The gaming industry is experiencing a steady upward trend and stable performance, making it a worthwhile sector for investment in the current market environment, particularly due to the product cycle in 2023 and 2024 [1][3] Key Companies and Their Performance 1. Giant Network - The game "Supernatural Action Group" has a high Daily Active Users (DAU) count and utilizes content dissemination strategies to effectively reduce sales expenses, leading to profit release. Significant revenue contribution is expected in Q3 due to frequent version updates that extend the game's lifecycle [1][5] - In July, the game reached over one million concurrent users, with continuous updates planned for September, enhancing user engagement and revenue potential [5] 2. G-bits - G-bits launched three new games this year: "Wen Jian Chang Sheng," "Zhang Jian Chuan Shuo," and the mini-program game "Dao You Lai Wa Bao." These are expected to contribute positively to profits in Q3, with "Zhang Jian Chuan Shuo" also having an overseas version that will generate additional revenue [1][6] - "Wen Jian Chang Sheng" generated 363 million yuan in Q1 but saw a decline to 203 million yuan in Q2. "Zhang Jian Chuan Shuo" contributed 426 million yuan in Q2, with expectations for improved performance in Q3 [6] 3. Kaiying Network - Kaiying Network holds exclusive rights to the "Legend" franchise, allowing it to sign cooperation agreements with major publishers, generating stable annual revenues of 100 to 200 million yuan [1][7] - The "Legend Box" business is expected to generate 543 million yuan in revenue in the second half of 2024, with projections of 1 billion yuan in total revenue for 2025, reflecting a year-on-year growth rate of 40% to 70% [1][8] - The high gross margin of 92% to 93% for the "Legend Box" business significantly enhances the company's overall revenue and profit [8] Market Outlook - The performance of the gaming industry is expected to remain stable in 2025 and 2026, supported by a substantial product cycle. The gaming sector and its ETFs are projected to continue their steady growth despite volatility in other sectors [3][4] Recommendations - Investors are advised to focus on Giant Network, G-bits, and Kaiying Network due to their strong performance and growth potential in the current market environment [2][4][9]

Summary of Key Points from the Conference Call Company Overview - The conference call discusses **Kying Network**, focusing on its strategic transformation and market positioning within the gaming industry, particularly the **Legend IP** segment. Core Insights and Arguments - **Market Potential**: The **Legend IP** remains vibrant, attracting new user demographics, including younger generations (90s, 95s, and even 00s), with a notable proportion of female players, indicating significant market potential [2][4]. - **Strategic Shift**: Kying Network has transitioned from a game developer to a full industry chain controller by signing an exclusive licensing agreement with **Tianqiong Interactive**, which allows the company to leverage the "Legend Box" private channel, significantly reducing customer acquisition costs [2][4]. - **Revenue Growth**: The company has entered into brand cooperation agreements with leading firms such as **Sanjiao Entertainment**, **Tanwan Games**, and **Zhangwan Technology**, generating a total of **450 million yuan** in entry fees, which has notably enhanced company revenues [2][5]. - **Profitability of "Legend Box"**: The "Legend Box" information service revenue now accounts for nearly **20%** of Kying Network's total revenue, with a gross margin of **90%**. The revenue and profit contribution from this segment is expected to increase by **over 60%** year-on-year in the first half of 2025 [2][6]. - **Net Profit Contribution**: The net profit margin from the "Legend Box" business is projected to exceed **60%**, potentially contributing **30%-40%** to Kying Network's overall performance last year, with future profit contributions possibly approaching or exceeding **50%** [2][6]. Additional Important Insights - **AI Initiatives**: Kying Network possesses a unique advantage in the AI sector, with investments in projects like **EVE** and the **AI UGC** dual engine, which may enhance the company's valuation flexibility and market competitiveness [2][7]. - **Long-term Growth Potential**: The company's focus on exploring new product categories and IP development is expected to provide substantial upward adjustments in profit forecasts, with a projected **17x PE** by 2026, leading to its inclusion in the September stock recommendation list [2][7]. - **Overall Outlook**: The strategic transformation through the "Legend Box" and advancements in AI and new product categories position Kying Network for robust future growth, with expectations of stable performance and potential for exceeding return forecasts [2][8].

Performance Summary - The company achieved operating revenue of 2.578 billion yuan in the first half of 2025, a year-on-year increase of 0.89% [1] - The net profit attributable to shareholders reached 950 million yuan, up 17.41% year-on-year, with a fully diluted EPS of 0.44 yuan [1] - In Q2 2025, the company reported a single-quarter operating revenue of 1.225 billion yuan, a decrease of 1.8% year-on-year, while the net profit attributable to shareholders was 432 million yuan, an increase of 12.8% year-on-year, corresponding to a diluted EPS of 0.20 yuan [1] Product Development and International Expansion - The company's product matrix includes retro-themed games and innovative premium titles, with notable products such as "Original Legend," "Angel Battle," and "Dragon Valley World" in the retro category, and "Three Kingdoms: The World Returns," "Douluo Continent: The Legend of Evil," and "Tomb Raider: The Journey" in the innovative category [1] - The overseas business saw significant growth, with "Sword and Fairy: A New Beginning" topping the iOS free charts in Macau and achieving high rankings in Taiwan and Hong Kong, leading to overseas operating revenue of 202 million yuan, a year-on-year increase of 59.6% [1] AI and New Business Initiatives - The company is advancing AI applications with its self-developed "Dream Weaving" model and the launch of the AI industrial pipeline "SOON," which automates the entire process from art asset generation to code deployment [2] - The "Legend Box" community platform is being developed to integrate various gaming elements, including live streaming, esports, and short dramas, aiming to enrich the content ecosystem and create new growth points [2] - The digital asset platform "Shiyuan Cube" combines blockchain, Web 3.0, and AI technologies to build a marketing ecosystem for digital art, promoting consumption in cultural tourism through a "digital assets + real economy" model [2]

Investment Rating - The report maintains a "Buy" rating for the company [10] Core Views - The company achieved a revenue of 1.225 billion yuan in Q2 2025, a year-on-year decrease of 1.80%, while the net profit attributable to the parent company was 432 million yuan, an increase of 12.79% year-on-year [2][5] - The company has a rich pipeline of new games and is actively advancing its AI initiatives, which are expected to benefit from related catalysts [2][8] Summary by Sections Financial Performance - In H1 2025, the company reported a total revenue of 2.578 billion yuan, a year-on-year increase of 0.89%, and a net profit attributable to the parent company of 950 million yuan, up 17.41% year-on-year [5][6] - Q2 2025 saw a slight decline in revenue due to fewer new game launches, but the "Legend Box" and overseas markets continued to grow rapidly, with overseas revenue increasing by 60% to 200 million yuan [6][8] Cost and Profitability - The company's sales expenses decreased by 13.7% year-on-year to 407 million yuan in Q2, resulting in a sales expense ratio of 33.3% [7] - The gross margin and net profit margin for Q2 were 81% and 35%, respectively, maintaining a high level of profitability [7] Future Growth Drivers - The company has partnered with several gaming companies to establish brand zones within the "Legend Box," which is expected to gradually enhance performance [8] - Upcoming game releases, including "Blood of Jianghu: Return" and others, are anticipated to drive revenue growth [8] - The company is making significant strides in AI, with projects like the 3D AI companion application "EVE" and the AI game development platform "SOON" expected to advance towards commercialization [8] Share Buyback Plan - The company plans to initiate a share buyback program with a total fund of up to 200 million yuan, aiming to repurchase shares at a price not exceeding 29.33 yuan per share [8] Earnings Forecast - The company is projected to achieve net profits of 2.16 billion yuan and 2.44 billion yuan in 2025 and 2026, respectively, corresponding to PE ratios of 23.0 and 20.4 [8]

Group 1 - The core viewpoint is that two listed companies, Changchun High-tech and Kaiying Network, have recently been investigated by a well-known private equity firm, Licheng Asset, highlighting their advancements and financial performance [1][2]. Group 2 - Changchun High-tech has made significant progress in using AI large models to design highly alkaline single-domain antibodies, successfully completing the development of a protein product that has entered 5000-liter scale production [1]. - Kaiying Network reported a revenue of 2.578 billion yuan for the first half of 2025, a year-on-year increase of 0.89%, and a net profit attributable to shareholders of 950 million yuan, up 17.41% [2]. - The overseas revenue for Kaiying Network reached 202 million yuan, marking a substantial year-on-year growth of 59.57%, with multiple products topping overseas charts [2]. - Kaiying Network has launched an AI development platform named "SOON" and plans to introduce an AI toy brand "Warm Star Valley Dream Journey" in 2025 [2]. - The controlling shareholder of Kaiying Network has cumulatively increased their holdings by over 130 million yuan, and the Legend Box has attracted multiple enterprises, with payment amounts reaching 450 million yuan [2]. Group 3 - Licheng Asset is one of the earliest established private equity management companies in China, focusing on a growth stock investment philosophy with a complete and unique investment management knowledge system [3]. - The firm has a team of 50 employees, with nearly 30 being professional research and investment personnel, managing a peak scale of over 10 billion yuan, and specializing in secondary stock long strategies and PIPE strategies in the fields of pharmaceuticals, advanced manufacturing, and consumer goods [3]. - Licheng Asset has consistently ranked high in long-term performance and has received multiple private equity awards [3].

Group 1: 威力传动 (Weili Transmission) - As of August 29, 2025, the company has invested a total of 1.23 billion yuan in the wind power gearbox smart factory, with construction completed and equipment arriving, currently in the process of commissioning and talent preparation [1] - The factory is in the initial stage of capacity ramp-up, with ongoing optimization of production team proficiency, production line coordination, and equipment debugging, leading to a steady release of capacity [1] - The decline in profit in the first half of 2025 is primarily due to increased period expenses, with labor costs rising by 75.45% year-on-year, attributed to early personnel preparation for the gearbox business [1] - The company has successfully supplied yaw asynchronous motors to major clients like Goldwind Technology and Envision Energy, and has delivered prototypes for electric drive systems for new energy vehicles, entering a phase of deepened cooperation [1] - A wholly-owned subsidiary has received approval for a 65MW wind power project, promoting synergy between new energy generation and transmission business [1] Group 2: 恺英网络 (Kaiying Network) - In the first half of 2025, the company achieved operating revenue of 2.578 billion yuan, a year-on-year increase of 0.89%, and a net profit attributable to shareholders of 950 million yuan, up 17.41% [2] - Revenue from information services reached 657 million yuan, primarily from the Legend Box and promotional services [2] - Overseas revenue amounted to 202 million yuan, reflecting a significant year-on-year growth of 59.57%, with multiple products topping overseas charts [2] - The company launched an AI development platform named "SOON" and invested in the EVE intelligent companionship application, planning to launch the AI toy brand "Warm Star Valley Dream Journey" in 2025 [2] - The controlling shareholder has cumulatively increased holdings by over 130 million yuan, and the Legend Box has attracted multiple enterprises, with payment amounts reaching 450 million yuan [2] Group 3: 紫光股份 (Unisoc) - In the first half of 2025, the company reported operating revenue of 47.425 billion yuan, a year-on-year increase of 24.96%, and a net profit attributable to shareholders of 1.041 billion yuan, up 4.05% [3] - The core subsidiary, H3C, generated revenue of 36.404 billion yuan, marking a year-on-year growth of 37.75% [3] - The company is involved in the construction of multiple urban intelligent computing centers and has launched products such as the UniPoD S80000 super node, liquid-cooled integrated cabinets, and 800G national core intelligent computing switches [3] - Internationally, Southeast Asia, the Middle East, Central Asia, and Europe are key regions, with subsidiaries established in Saudi Arabia and Germany [3] - The company has submitted an application for H-share listing and is advancing the related approval process [3]

Group 1: BoRui Pharmaceutical - BGM0504 tablet for weight loss has submitted IND applications in both the US and China, with FDA approval for Phase I clinical trials and the first dosing group about to start [1] - BGM1812 injection for weight loss has also submitted IND applications in both countries, while the oral tablet is in preclinical research [1] - The company is developing multiple formulations based on GLP-1/GIP dual targets and mylin-like molecules to meet different weight loss population needs [1] Group 2: Weili Transmission - As of August 29, 2025, the company has invested 123.12 million yuan in the wind power gearbox smart factory, with construction completed and equipment arriving [2] - The factory is in the initial capacity ramp-up phase, with ongoing optimization of production team proficiency and equipment debugging [2] - The decline in profits in the first half of 2025 is mainly due to increased period expenses, with labor costs rising by 75.45% year-on-year [2] Group 3: Sanfu Outdoor - X-BIONIC brand saw a growth rate of 28.07% in the first half of the year, with expectations for increased growth in the second half due to the winter peak season [3] - HOUDINI brand experienced a remarkable growth rate of 187.87%, expected to maintain high growth [3] - The company plans to enhance market investment in trail running and skiing, and will open new stores in the second half of the year [3] Group 4: Kaiying Network - In the first half of 2025, the company achieved revenue of 2.578 billion yuan, a year-on-year increase of 0.89%, and a net profit of 950 million yuan, up 17.41% [4] - Overseas revenue reached 202 million yuan, growing by 59.57%, with multiple products topping overseas charts [4] - The company launched an AI development platform and plans to introduce an AI toy brand in 2025 [4] Group 5: Focus Technology - In the first half of 2025, the company reported revenue of 915 million yuan, a year-on-year increase of 15.91%, and a net profit of 295 million yuan, up 26.12% [5] - The number of paid members on China Manufacturing Network reached 28,699, with I-Maike members exceeding 13,000 [5] - The company is enhancing AI capabilities to improve multilingual reception and system stability [5]