NTES(09999) 华创证券·2025-04-01 08:45Investment Rating - The report maintains a "Buy" rating for NetEase-S (09999.HK) [1] Core Views - The strong recovery in PC gaming has led to a positive turnaround in gaming revenue, with the game "Marvel Duel" exceeding expectations [2][22] - The company is expected to continue its growth in gaming revenue in Q1, driven by new product launches [3][23] - The valuation model suggests a target price range of HKD 175-207 for 2025, based on a sum-of-the-parts (SOTP) valuation approach [4] Financial Performance Summary - For the full year, gaming and related services generated revenue of CNY 836 billion, a year-over-year increase of 2.5%, with PC game revenue at CNY 219.46 billion (up 16.56%) and mobile game revenue at CNY 584.96 billion (up 2.7%) [2][22] - In Q4, gaming and related services revenue reached CNY 212 billion (up 1.54% year-over-year), with online gaming revenue at CNY 205.41 billion (up 5.12%) [2][22] - The gross margin for the gaming business in Q4 was 66.70%, reflecting a slight decrease [2][22] Earnings Forecast and Valuation - The forecast for net profit attributable to shareholders for 2025-2027 is CNY 311.99 billion, CNY 339.94 billion, and CNY 361.22 billion, respectively [4] - The current stock price corresponds to a PE ratio of 15.0 for 2025, 13.8 for 2026, and 13.0 for 2027 [4] - The report highlights the importance of new product launches for future revenue growth, with several titles in the pipeline [3][23] Key Financial Metrics - Main revenue for 2024 is projected at CNY 105,295 million, with a year-over-year growth rate of 1.8% [5] - Net profit for 2024 is estimated at CNY 29,698 million, with a growth rate of 1.0% [5] - The report indicates a stable financial position with a debt-to-asset ratio of 27.30% [6]