CHINA LITERATURE LIMITED(772.HK) Anti-piracy has a long way to go, pay attention to its IP monetization ability June 28, 2023 225

PSR Recommendation: NEUTRAL Status: Initiation
Target Price: HKD36.20

China Lit(772.HK) is a comprehensive cultural industry group based on Chinese
online literature and centered on IP cultivation and development as its core. Its
subsidiaries include well-known brands in the industry such as QQ Reading, Qidian
and New Classics Media(NCM). It has a lineup of writers and a rich reserve of
literatures, covering more than 200 content categories, reaching hundreds of
millions of users, and adapting a large number of web text IPs, such as Joy of Life,
The King’s Avatar and Soul Land, into animation, film and television and games
and other products.
A review of Q3 2022 Results
China Lit (772.HK) has announced the annual report ended December 31, 2022.
The company’s revenue amounted to RMB 7.6 billion, decreasing 12.0% YoY. Cost
of revenue amounted to RMB 3.6 billion, decreasing 11.6% YoY. Gross profit
amounted to RMB 4.0 billion, decreasing 12.4% YoY. Gross profit margin was 52.8%,
slightly decreasing 0.3 percentage point YoY. Operating profit was RMB 0.6 billion,
decreasing 71.1% YoY. Profit attributable to non-IFRS shareholders amounted to
RMB 1.4 billion, increasing 9.6% YoY.

About the author

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Elvis Kwok

香港恒生大學金融分析一級榮譽畢業,具有股票研究、技術分析和投資經驗。現為輝立証券持牌分析師,主要負責遊戲?娛樂?食品等板塊研究。 Elvis holds a BBA degree with first class honor major in Financial Analysis at the Hang Seng University of Hong Kong. He has experience in equity research, technical analysis and investment experience. He is currently a licensed research analyst at Phillip Securities and mainly covers Gaming, Entertainment and Food sectors.

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