"Dream" And "Magic Tower": Can The "Hot Spots" In The Perfect World Be Closed

"A-share game board is at the bottom of valuation, some companies will enter a new product cycle."

Since May, a number of institutions have published research reports and began to drum up the market of the game board.

Prior to that, on April 13, perfect world (002624. SZ), the top three in the A-share game board, held a game strategy conference in Beijing.

At the conference, perfect world launched a new logo, and released nearly 30 diversified new products and IP cooperation plans.

No, it's not ambitious.

In 2021, the stock price of perfect world has gone down all the way. In the latest quarter, the stock price of perfect world has risen by more than 11% since late March.

Can hot stories in the game board be closed in the "perfect world"?

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In the past year, many game companies have achieved good results due to the "home economy" bonus brought by the new crown pneumonia epidemic.

The perfect world is no exception.

In 2020, perfect world will join the "ten billion club" with revenue of 10.225 billion yuan and net profit of 1.549 billion yuan.

The two data increased by 27.19% and 3.04% respectively.

According to CITIC's first-class industry classification, perfect world's revenue and total profit ranked third and fourth respectively in the A-share game industry.

At first glance, the growth rate of 3% in net profit is far from excellent. However, this achievement was made in the case of huge inventory falling price loss in film and television business.

Just looking at its game business, its revenue and net profit in 2020 will be 9.262 billion yuan and 2.285 billion yuan respectively, with a year-on-year growth rate of 35% and 20.43% respectively.

In A-share game companies, perfect world is one of the few companies that concurrently engage in mobile online games, PC end online games and console games.

In 2020, only console game revenue will decline by 5.26% among the three perfect game sectors.

Mobile online games contributed most of the revenue growth of perfect game business, with the revenue growth rate of 57.05% last year. In 2020, mobile online games have become a segment business accounting for 59.60% of the perfect revenue.

The main growth in perfect world's game performance in 2020 will continue to be provided by the start-up and basic category, MMORPG games.

In 2020, 71.4% of the products in the perfect world will be MMORPG.

In 2020, perfect world will further increase the market share of this segment.

According to Gamma data, in 2020, perfect has obtained 24.4% market share in the mobile game MMORPG segment, which is 1.9% higher than that in the first half of 2020.

Its four main games, Zhuxian, perfect world, xinxiaoao lake and new magic land, have long been on the top 50 of IOS game bestsellers.

"The best seller list of IOS games is a very important data index of the industry, which we will refer to when we study the product strength of manufacturers. The performance of the four games in the top 50 for a long time is not bad. " A private game industry analyst told researchers.

In addition to MMORPG, another sub sector of perfect world that will continue to be the industry leader in 2020 is R & D investment.

In 2020, the R & D expenditure of perfect world will continue to increase (5.64% year-on-year), from 1.504 billion yuan to 1.589 billion yuan.

This number ranks first in all A-share game companies.

Its 17.44% R & D investment accounts for the revenue ratio, which also ranks the top in A-share game companies.

"The R & D strength of perfect world is on the upper side of the industry, mainly accumulated in MMO categories." A large game manufacturer analyst told the researchers.

Industry insiders believe that at present, the R & D capacity of the perfect world is second only to Tencent and Netease in the industry.

Huachuang securities also pointed out in the research report that at present, the engine strength of the game industry has formed intergenerational difference, and it is difficult for other manufacturers to catch up with perfection“ It is expected to launch some key products with advanced picture technology, such as the remains of war god, the dream of new killing immortals and the magic tower, etc., in 2021. "

Short term inflection point

For game companies, the high base number caused by the epidemic in the first quarter of 2020 will generally turn into performance pressure after entering 2021.

In 2021, the performance of A-share game companies in the first quarter will decline.

Take century Huatong (002602. SZ) and Sanqi mutual Entertainment (002555. SZ), which have more than 10 billion revenue, as examples. The former achieved 3.997 billion yuan of operating revenue in the first quarter, with a year-on-year growth of 5.06%; The net profit was 585 million yuan, down 27.24% year on year; The latter achieved revenue of 3.82 billion yuan in the first quarter, a year-on-year decrease of 12.1%, and a net profit of 120 million yuan, a year-on-year decrease of 84.0%.

The perfect world also fails to escape this rule.

In the first quarter of 2021, the company achieved revenue of 2.231 billion yuan, a year-on-year decrease of 13.3%; The net profit was 464 million yuan, a year-on-year decrease of 24.5%.

In addition to the high base number brought about by the epidemic, the recent lack of new games launched by perfect world is another important reason for the decline in the first quarter.

Since the beginning of the year, only two new games have been launched in perfect world: one is "Legend of old days" and the other is "remains of war god".

Compared with other major game manufacturers in China, the number of online games of the two types is obviously less: in the same period of time, Tencent has launched 11 games, Netease has launched 7 games, and Gigabit (603444. SH) and Sanqi mutual entertainment have all launched four games.

In an institutional survey conducted in April, perfect world also said that the launch of several games that the company has focused on this year has been delayed: "ares relics was launched on May 20, which was later than planned《 The movie was originally scheduled to be launched on May 28, but will be delayed. It is expected to be after June 28《 The second test of fantasy tower will be held on April 15. According to the preparation for launching in summer vacation, it may be postponed (no big test has been done yet)

There are also views that, although the new game, which is delayed, puts pressure on the short-term performance of perfect world, it is expected to bring positive profit contribution in the second half of the year.

There are many cases supported by this view.

Take the new dream of killing the immortals, which has been postponed to June, as an example, many agencies predict that this perfect world will not make a great contribution to Q2, and the peak value of running water is expected to exceed 400 million yuan.

"It is expected that the peak flow of" dream new Zhuxian "(expected to be online in late June) will surpass that of" dream killing immortal " Zhongtai Securities said recently.

The number of 400 million running water will exceed the sum of the previous several old games in a single month.

In terms of perfect world, according to a survey conducted by the organization in April, the total amount of products such as "new land of gods and demons", "mobile tour of perfect world", "new smile proud of the lake" and "Zhuxian" in March this year exceeded 320 million yuan.

Of course, although perfect world's game business will grow by 20.43% in 2020, the company's overall net profit growth rate will eventually be only 3% dragged down by the film and television sector with a loss of 500 million yuan.

In the fourth quarter of 2020, perfect world made asset impairment for various assets such as goodwill and inventory of film and television business, totaling more than 900 million yuan, releasing inventory pressure and impairment risk at one stroke.

In the first quarter of this year, "Shangyang Fu", "eye of the storm", "love under the stars" and other film and television projects have been recognized revenue.

Recently, perfect world has indicated that it will adopt a more focused and prudent strategy in the film and television business in order to achieve a sound financial contribution.

Long term increment

If talking about the long-term, in addition to "dream of new Zhu Xian", the perfect world another major focus game is "magic tower".

As an original light science fiction open world ARPG (Action Role Playing Game) product independently developed and created, magic tower is an important layout of perfect world in the young game track.

Including "magic tower", perfect world's current game products include MMORPG, turn system, ARPG, card, sandbox and leisure, involving a variety of themes such as the two-dimensional future science fiction, the two-dimensional Japanese fantasy, the Western magic, the Oriental immortal and the oriental martial arts.

It is expected that the younger new category games represented by "magic tower" will be the main source of long-term increment of the perfect world.

"Tower of fantasy" is built with illusory four engines, and is often used by players to compare with another two-dimensional open world game with a similar style - "original God". The latter can be called the most successful new tour in the world last year, and has attracted more than 1 billion US dollars in just half a year after its release.

In April this year, magic tower officially opened its second internal test, and successfully got the game version number at the end of the month.

As of May 30, the number of appointments on the game website taptap has reached 850000.

According to the agency's heat tracking based on the internal test, the player activity of "magic tower" is high: among the 100 person level gangs ranked in the middle of the game, the proportion of weekly active players and super active players is 81% and 33% respectively.

The original God, which takes the route of the second dimensional open world, has achieved great success. So, what are the future opportunities for the similar "magic tower"?

In this regard, a number of game industry insiders who participated in the internal test all told the 21st century capital research institute that "magic tower" still needs to be polished.

Game developer Li Ting (pseudonym) told researchers that the internal version of "magic tower" the overall world is a bit monotonous, the richness of the items is not enough.

Liu Tao (pseudonym), another researcher working for head game manufacturers, told the researchers that although it has the label of "open world", magic tower is still an MMORPG game on the whole.

To this point, Huachuang securities also pointed out in its recent experience report: "on the whole, in addition to adding novel open world playing methods and young design, the consumption and experience logic at the bottom of magic tower still follows the template of mainstream MMO."

Liu Tao told researchers that the core playing method reflected in the test version of "magic tower" is not the same as "original God", which is often used as a benchmark.

"The interaction of the seven elements constitutes the underlying logic of the game world of the original God, and its core playing method is the collection and cultivation of multiple roles." Liu Tao said.

The core playing method of "magic tower" is multi weapon collection and Cultivation Based on element reaction. Compared with the original God, fantasy tower can continue to improve in game system design and adventure exploration content. And as an ARPG game, the magic tower's current operating space is not enough.

However, during discussions with the industry, some people in the industry believe that the recent internal test version of magic tower has made great progress compared with the original test version.

As it is still in the internal test, the unreal tower can still be improved.

In addition to promoting diversified new products in the game product end, perfect world is also doing diversified development in the market side.

This may mean that overseas markets are expected to be another source of forward growth in the perfect world, but the path is clearly not smooth.

In 2020, more and more Chinese game manufacturers will choose to go abroad.

According to the report on China's game industry in 2020, the actual sales revenue of China's independent R & D games overseas market reached 15.45 billion US dollars last year, with a year-on-year increase of 33.25% and a year-on-year increase of 12.3%.

Although several games such as R5 (the new magic land) and the new Xiaoao Lake m have been listed on the top 10 of IOS or Google's best seller lists since they were launched overseas last year, the proportion of overseas market in the revenue of perfect world games (16.67%) is still relatively small.

"We will launch game products suitable for global distribution, and gradually establish overseas distribution teams," perfect world has said in a recent institutional survey.

"We will start with small games, learn from the buying strategy, and gradually expand the team in the medium and long term."

The market is also waiting for changes to emerge in the financial data.

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