Promising outlook for IP business
? China Literature reported FY21 revenue of Rmb8.7bn, up 1.7% yoy, and core net
profit of Rmb1.2bn, up 36.1% yoy, slightly above our expectation, because of better
cost control, such as a reduction in New Classic Media (NCM)’s production costs.
? NCM will launch 6–8 dramas and 2–3 films in FY22F, and we expect 20% yoy sales
growth for the IP business.
? Reiterate Add with a new DCF-based TP of HK$53.6.