传播文化行业：子赛道的成长确定性上升历史低位的估值水平具有巨大弹性“跑赢大市”-20221226-国泰君安

archportarchReportultureSectorRating:archportarchReportultureSectorRating:TeddyLin林荣叶(86755)23976692yelingtjascomhkDecember2022GrowthCertaintyofSub-industriesImproves,HistoricallyLowValuationHasGreatRoomforRebound,"Outperform"子赛道的成长确定性上升，历史低位的估值水平具有巨大弹性,“跑赢大市”Bycomparingandanalyzingtheoperatingperformanceandshareperformanceofeachsub-industryofthemediaandculturesectoroverthepastyear,wencludethatthedeclineinthevaluationofthemediaandculturesectorwasfarionintheoperatingperformanceofthewholesectorin2022–thiswaslikelyduetothemarket'searlieroverreactionamidpessimismaboutfuturepoliciesandearningsgrowthofthesector,inourview.Nowwithlessuncertaintiesinthemediaandculturesector,severalsub-industriesstarttoseevaluationrepairs,especiallythemovies&entertainmentsub-industry.Byanalyzingthefactorsofuncertaintiesaffectingthesub-industriesandthecurrentoutlookontheseuncertainties,wearguethatwhilepreviouspessimismstillweighonvaluation,sector'snewgrowthprospecthasyettobefullypricedin.Weareparticularlybullishonthepotentialforvaluationrecoveryintheinteractivehomeentertainmentandinteractivemedia&servicessub-industries.Basedontheanalysisofspecificfundamentalsofsub-industriesinmediaandculturesector,weexpectthefollowingkeyfundamentalstoboostthesector'svaluation:1)withthenormalizationofreleaseofgamecopyrightandtheexpansionoverseas,thecertaintyofrevenuegrowthincreasesinthegame-relatedsub-industries;2)profitabilityofvideoplatformsbeginstoimprovesignificantly,backedbythereliablemonetizationfromshortvideoe-commerce;3)expectationsofcinemaboxofficerecoveryroseonlooseningCovid-19restrictionswhiletheupcomingbatchofhigh-qualitymoviescouldalsoprovideadditionalboost;4)E-commercemarketingwillopenupnicheincrementalcpreventionandcontrolpoliciesraiserevenueexpectationsofe-commercemarketingrelatedindustries.Weratethesectoras"Outperform".WerecommendTencent(00700HK),NetEase(09999HK),Bilibili-SW(09626HK),Kuaishou-W(01024HK),andJoySpreader(06988HK).通过比较和分析传媒文化板块的各个子行业在过去一年的运营表现和股价表现，我们判断板块的估值跌幅远超2022年全行业运营表现的下滑程度，我们将其主要原因归咎为市场早前对于整个板块未来的政策和盈利成长性的悲观情绪过度反应。目前与传媒行业相关的不确定性逐渐明朗，若干个子行业已开始出现估值修复，其中表现最为突出的是电影娱乐行业。通过分析过去影响股价的不确定性因素以及目前对于这些不确定性的展望，我们认为早前的悲观预期已基本被市场消化，而新的行业成长性仍未反映在股价上，因此未来传媒和文化板块的反弹空间巨大。其中，我们尤其看好互动家庭娱乐和互动媒体及服务子行业的潜在估值反弹空间。基于传媒文化子行业具体基本面的分析，我们预计以下几个重要的因素有望提振整个板块的估值：1.随着版号常态化以及游戏出海，游戏板块收入增长的确定性上升；2.视频平台未来的盈利能力开始出现显著的改善，短视频电商为其提供可靠变现能力；3.随着疫情防控政策优化，影线票房收入复苏的预期升温，待上映的优质影片也将进一步助力；4.电商营销开辟长尾增量市场，疫情防控政策优化将提升电商营销相关产业的收入预期。我们给予行业“跑赢大市”评级。推荐腾讯(00700HK)、网易(09999HK)、哔哩哔哩-SW(09626HK)、快手-W(01024HK)，以及乐享(06988HK)。OutperformMaintained跑赢大市(维持)Mediasectorperformancevs.HangSengIndex传媒行业表现vs.恒生指数Source:iFinD.Note:Theabovefiguresarecalculatedbasedonmarketcap-weightedaverageshareperformanceiniFinDasat23Dec.2022.Sub-industryperformanceofmediavs.HangSengTECHIndex传媒板块子行业表现vs.恒生科技指数Source:iFinD.Note:Theabovefiguresarecalculatedbasedonmarketcap-weightedaverageshareperformanceiniFinDasat23Dec.2022.SeethelastpagefordisclaimerPage1of15证券研究报告行业报告股票研究PMedia&CultureSector1.2022MarketReview:WhatweretheMajorOverhangs? 3 erallSharePricesareStillDownSharply s 2.IndustryOutlook:WeExpectValuationofMediatoReboundasGrowthCertaintyImproves 6ound rketExpenditureforVideoPlatforms VideoEcommerceGainsIncrementalGrowthfromNicheMarket adytobeReleasedDrivingUptheMoviesSubindustry 3.InvestmentStrategy 14RiskWarning 142626December2022MediaMedia&CultureSector传播文化行业SectoSectorReportSeethelastpagefordisclaimerPage2of15ConsumerServicesFood&StaplesRetailingEnergyTelecommunicationServicesTransportationInsuranceFood,Beverage&TobaccoHealthCareEquipment&ServicesRealEstateConsumerServicesFood&StaplesRetailingEnergyTelecommunicationServicesTransportationInsuranceFood,Beverage&TobaccoHealthCareEquipment&ServicesRealEstateBanksCapitalGoodsTechnologyHardware&EquipmentHousehold&PersonalProductsDiversifiedFinancialsRetailingMaterialsSemiconductors&SemiconductorEquipmentPharmaceuticals,Biotechnology&LifeSciencesMedia&EntertainmentSoftware&ServicesCommercial&ProfessionalServicesConsumerDurables&ApparelUtilitiesAutomobiles&ComponentsMedia&CultureSector传播文化行业SectorReportPMedia&CultureSectorMarketReview:WhatweretheMajorOverhangs?CurrentValuationStillatHistoricalLowsThemediaandculturesectorinHongKongsawasignificantretracementinvaluationin2022,amideconomicdowncycle,regulatoryuncertainties,aswellasaslowdownintechnologicalinnovation.TheYTDmarketcap-weightedaveragereturnoftheGlobalIndustryClassificationStandard’s(GICS)classifiedmediaandentertainmentsectorwas-19.1%(asat23Dec.2022),underperformingtheHangSengIndex(-16.3%)butoutperformingtheHangSengTechnologyIndex(-27.3%).TheGICSclassifiedmediaandentertainmentsectorrankedthe19thamongthe24secondarysectors.FigureTheperformanceofthemediaentertainmentsectorwasinthelowerreachesamongsectors2626December202245%35%25%%-5%-25%-25%-35%-45%Source:iFinD,GuotaiJunanInternational.Note:Theabovemarketcap-weightedaverageshareperformancearecalculatedbasedoniFinDasat23Dec.2022.ThevaluationofthesectorhasrecoveredsignificantlysinceNovember,butoverallitisstillvolatileandathistoricalertainmentsectorhadthehighestvaluation(32.5x)amongthefourvaluationbenchmarksandwassignificantlyhigherthantheaverageP/EratioofthemainboardhinaxButthevaluationofmediaandentertainmentsectorcontinuedtofall,becomingthelowestfromAugusttoNovember.Afterthethirdquarter,HangSengcomponentswasthefirsttoseesignificantP/Evaluationsrecovered.AndinNovember,mediaandentertainmentsectoralsostartedtopullitsvaluationback.Drivenbytheimprovedliquidityandmorefriendlyregulatoryenvironment,therewasavaluationre-ratinginNovember–themarketcap-weightedshareperformancesawa42.2%increase.ButsinceNovember,valuationofmediaandentertainmentsectorhadfluctuatedwildly.Themediaandentertainmentsectorarenowbackatthetopofthefourvaluationbenchmarks,whichwas27.9xasof23Dec2022,butonlyslightlyabovetheaverageP/EratioofHangSengcomponents(25.5x).SeethelastpagefordisclaimerPage3of1526December2022Media&CultureSector传播文化行业SectorReport26December2022Media&CultureSector传播文化行业SectorReportPMedia&CultureSectorFigure-2:TheaverageP/Eratioofthemediasectordroppedfromtheoriginalpeaktothelowest,andfluctuatedconsiderablyinlate2Media&EntertainmentThemainboardofHongKongstocksConstituentstocksofHangSengIndexPrivateChinesestocksinHongKong.025.020.0Source:iFinD,GuotaiJunanInternational.Note:TheaboveaverageP/Eratios(TTM)arecalculatedbasedoniFinDasat23Dec.2022,excludingnegativeandover500..DespiteABoostfromMoviesStocksinNovember,OverallSharePricesareStillDownSharplyThebroadcastingsub-industrymaintainedapositiverateofreturnthroughouttheyear,butitsperformancewasovertakenbythemoviesandentertainmentsub-industryattheendoftheyear.Inthecaseofsignificantvaluefallinthewholemarket,thebroadcastingsub-industry(classifiedbyGICS)basicallyshowedapositiverateofreturnforthewholeyear.Thestockperformanceofcable&satellitesub-industry(classifiedbyGICS)basicallyhoveredbetweenprofitandlossallyear.Bothofthetwosub-industrieshaveshownthemselvesmoredefensiveandresilientinthefaceofsubduedmacroeconomicandinvestmentsentiment.Othersub-industriesofmediaandentertainmentbasicallymaintainednegativereturnstovaryingdegreesthroughouttheyear,exceptforthemovies&entertainmentsub-industry(classifiedbyGICS),whichbegantoshowasignificantpositivecorrectioninNovember.TheYTDrateofreturnofmovies&entertainmentishigherthanthatofbroadcasting,becomingthesubindustrywiththehighestannualrateofreturnsofar.FigureThebroadcastingsperformancewasovertakenbythemovies&entertainmentattheendof2022ertainmentertainmentgeentertainment%dvertisingmediaservicesSource:iFinD,GuotaiJunanInternational.Note:Theabovemarketcap-weightedaverageshareperformancearecalculatedbasedoniFinDasat23Dec.2022.SeethelastpagefordisclaimerPage4of15SectorReportSectorReportPMedia&CultureSectorTheperformanceofthemoviesentertainmentshowedgreatresiliencein2022andiscurrentlythehighestYTDrateofreturnamongallsub-industriesinthemedia&entertainmentsector.Asof232021,themovies&entertainmentrecordedonresilienceAlthoughcablesatelliteandpublishinghaverecordedYTDnegativereturns,-7.5%and-15.0%,respectively,theiroverallperformanceswasstillsignificantlybetterthantheHangSengIndex(-16.3%),showingtheirstrongdefensive.Advertising(22.6%),interactivemedia&services(25.7%)andinteractivehomeentertainment(26.6%),whileunderperformingtheHangSengIndex,slightlyoutperformingtheHangSengTechnologyIndex(-27.3%).Figure-4:Themovies&entertainmentshowedgreatresiliencewhilecable&satelliteandpublishingshowingstrongdefensive226December202250%40%30%50%40%30%20%10%0%-20%-30%-40%46.7%46.7%19.8%-7.5%-22.6%-25.7%-26.6%MediaMedia&CultureSector传播文化行业Source:iFinD,GuotaiJunanInternational.Note:Theabovemarketcap-weightedaverageshareperformancesarecalculatedbasedoniFinDasat23Dec.2022.TheshareperformanceofTencentMusicandAutohomestoodout.Themajorityofleadingcompaniesinthemediasector(weselectedcompanieswithamarketvalueofmorethanHK$10billion)sawasignificantdeclineinvaluationin2022.ExceptTencentMusic(69.0%)andAutohome(11.3%),thesharepricesofleadingcompaniesinmediasectorarealldownsignificantlyTYD.Amongthem,CloudMusic(-51.7%),Bilibili(-48.1%),Weibo(-40.2%)andChinaLiterature(-39.1%)fellmorethan35%.TableTheperformanceofleadingcompaniesinmediaandtheircorrespondingvaluationsCodenceTotalmarketcapbnKncent%.8KK%KKncentMusicKKWeibo%KAutohome.2KnaLiteratureKsic%KAlibabaPicturesKeimob%KXinhuaWinsharePublishing%.0Source:iFinD,GuotaiJunanInternational.Note:AbovefiguresarebasedoniFinDasat23Dec.2022.SeethelastpagefordisclaimerPage5of15Media&CultureSector传播文化行业SectorReportMedia&CultureSector传播文化行业SectorReportPMedia&CultureSectorEarlierConcernsaboutUncertaintyweretheBiggestFactorAffectingValuationsWebelievethesector’spreviousvaluationde-ratingwasmainlyduetothemarket'sconcernaboutthefutureuncertaintyratherthantheweaknessinoperatingperformance.Webelievethestrongresilienceofsharepriceinthemovieandentertainmentsub-industrywasmainlyduetothehighercertaintyoftheexpectationofrecoveryincinemaboxoffice.Broadcasting'shighgrowthinrevenueandnetprofitmakestheindustryaverydefensiveinvestment.TheCovid-19pandemicseverelyimpactedadvertisingrevenuegrowth,andwebelievetherevenueforecastcutisanimportantfactoraffectingthevaluation.Webelievethereisadivergencebetweenthevaluationandtheoperatingperformanceintheinteractivehomeentertainmentandinteractivemedia&servicessub-industry,andthepessimisticsentimentofuncertaintyismoreaffectingtheiondamagetothesubindustriesBasedonthesignificantimprovementandclarityofthecurrentCovid-19preventionpoliciesandthegradualclarityofthepolicyenvironmentforthemedia-related226December2022industries,thefuturevaluationofthemediaandcultureindustrywillseeasignificantrepair.Thesub-industryofinteractivehomeentertainmentandinteractivemedia&services,whichsufferedthemostfromvaluationdamage,haveaparticularlylargeroomforreboundinvaluationgiventhegradualremovalofuncertaintyintheirindustries,inourview.TableTheoperatingperformanceandvaluationperformanceofeachsubindustryinmediaandculture11H2211H2233Q222022revenue2022netprofitYTDmarketSub-industryrevenurevenuegrowthooperatingprofitgrowthrevenuegrowthgrowthconsensusforecastgrowthconsensusforecastcap-weightedaverageshareperformanceertainment.0%.9%.3%6%46.7%ing%.4%n.a.4.2%blesatelliten.a.n.a.n.a..5%g4.0%n.a.n.a.-15.0%Advertising.2%.9%%223.9%.6%vemediaservices.2%-25.7%meentertainment6.2%%.6%Source:iFinD,GuotaiJunanInternational.Note:AbovefiguresarebasedoniFinDasat23Dec.2022.2.IndustryOutlook:WeExpectValuationofMediatoReboundasGrowthCertainty2.1.Games-relatedSub-industryHastheGreatestPotentialforValuationReboundOverthepastyear,theoverallvaluationofthegame-relatedsub-industryhasfallenfarmorethanthedeclineinsalesscale.Asof22Dec.2022,themarketcap-weightedaverageprice-to-salesratio(TTM)ofthe13HongKong-listedleadingcompaniesingameindustryweselectedwas4.68,down24.5%YTD.AccordingtoBloombergconsensusestimates,themarketcapweightedaveragerevenuegrowthforHongKong-listedleadingcompaniesingameindustryisestimatedtobe-8.2%%in2022and10.9%in2023,respectively.Webelievethecurrentvaluationhasfullyreflectedthemarket'spessimisticexpectations.AlthoughthevaluationofthewholesectorbegantorecoverinNovember,itisstillatthelowestpointsince2016.Wedon'tseemuchdownsidetovaluationsgoingforward.Onthecontrary,theleadinggamecompaniesnowhaveroomtogrowbylaunchinggamesoverseas,andvaluationsareexpectedtobouncebackonperformance.SeethelastpagefordisclaimerPage6of1520Source:20Source:iFinD,GuotaiJunanInternational.Note:Theabovemarketcap-weightedaverageprice-to-salesratio(TTM)iscalculatedbasedoniFinDasat23Dec.2022.TableRevenueandPSratioofgamecompanieslistedinHongKong Source:Bloomberg,GuotaiJunanInternational.Note:AbovefiguresarebasedonBloombergasat22Dec.2022.SectorReportPMedia&CultureSector FigureThevaluationofthegamesectorfellbacktohistoriclows2626December2022864 PSofGameSectorMediaMedia&CultureSector传播文化行业Weexpecttheregulatoryuncertaintytoimproveasgamecopyrightnumbersresumedistributionandreturntoerthisyear,thesixthbatchofgamecopyrightwerereleased,andthereleaseofapprovalofgamecopyrighthasbeennormalized.Thenumberofgamecopyrightreleasedhasbeenslightlyincreasedinthesecondhalfofthisyear.Weexpectsubstantialimprovementtocontinueasmoreoftheleadingcompanies’keygamesreceivetheapprovalofgamecopyright.SeethelastpagefordisclaimerPage7of152018.12018.22018.32018.42018.52018.62018.72018.82018.92018.102018.112018.1220192020.12020.22020.32020.2018.12018.22018.32018.42018.52018.62018.72018.82018.92018.102018.112018.1220192020.12020.22020.32020.42020.52020.62020.72020.82020.92020.102020.112020.122021.012021.022021.032021.042021.052021.062021.072021.082021.092021.102021.112021.122022.012022.022022.032022.042022.052022.062022.072022.082022.092022.1116001400120010008006004002000138369748445606769737055575767727Source:StateAdministrationofRadio,Film,andTelevision(China),GuotaiJunanInternational.Industrysupervisionfocusesontheprotectionofminors,andtheprobabilityofstricterregulatorypoliciesisnothigh.Afterreviewingtheindustryregulatorypoliciessince2016,webelievethatthecoreofgameregulatorypolicieshasalwaysbeentheprotectionofminorsandleadingthequalityofculturalproducts.Intermsofthepreventionofminors'addictiontogames,majorgamecompanieshavebasicallymettheregulatoryrequirementsintermsofcompliance.Webelievethatthemarginalincrementofpolicyregulationisnotmuchatpresent,andtheprobabilityoffurthertighteninginthefutureisnothigh.People'sDailyOnlinepointedoutthatthedigitalgameindustryhasgreatsignificancetothecountry'sscientificandtechnologicalinnovation.AttherecentEuropeanUnionConference,aresolutionwasputforwardtofocusonthedevelopmentofthedigitalgameindustry,callingforalong-termdevelopmentstrategyinEuropetosupportthedevelopmentofstart-upsindigitalgamesectorOnNovember2,People'sDailyOnlinecommentedon"theEuropeanParliamentpassedaresolutiononattachingimportancetothedevelopmentofdigitalgameindustrybyalargevote",pointingoutthatdigitalgamehavelongbeenridofthesingleattributeofentertainmentproducts,andhavebecomeanindustryofgreatsignificancetoacountry'sindustriallayoutandscientificandtechnologicalinnovation,andproposedthatdigitalgamecanpromoteChineseculturetotheworldbetter.ThegrowthofgameAppdownloadshasnotsloweddown,reflectingthatthedemandsidehasnotbeensignificantlyaffected.AccordingtoQimai,withtheexceptionofFebruary2022,gameAppdownloadshavemaintainedgrowthmomentumcomparedtothesameperiodlastyear.Webelievethatalthoughthecurrentprosperityofthegameindustryisnothigh,thedtocontinuetoimproveaftertheeconomicrecoveryinthefuture.PMedia&CultureSector FigureThereleaseofapprovalofgamecopyrightinChinaisbacktonormalNumberofreleaseofgamecopyright2626December2022MediaMedia&CultureSector传播文化行业SectoSectorReportSeethelastpagefordisclaimerPage8of15Media&CultureSector传播文化行业SectorReportMedia&CultureSector传播文化行业SectorReportPMedia&CultureSector FigureMobilegamedownloadsontheiPhonecontinuedtogrow2626December20222.00.50.035%30%25%20%5%0%-5%MobilegameAppdownloads(iPhone)YOY(RHS)Source:Qimai,GuotaiJunanInternational.Therichproductlineofthefuturegameindustryisexpectedtobringindustrygrowth.Withthenormalizationofgamecopyrightapproval,alargenumberofgamesaretobelaunchedafter2022.Webelievethatthegamesectoriscurrentlyinanupwardperformancecyclewithrelativelyhighcertainty,andtherichproductlineisexpectedtodrivetheperformanceandthusboostthevaluationofthesector.Ontheotherhand,gamecompanieswiththeabilityofindependentresearchanddevelopmentandselfpublishinghavemadeinitialachievementsinlaunchinggamesoverseas.Weexpectthatlaunchinggamesoverseaswillinnegativesentimentonpolicyandearnings,andthegamesectorisstilltradingatlowvaluations,withplentyofroomforfurtherupside.2.2.GrowthLessSensitivetoMarketExpenditureforVideoPlatformsBothshortandlongvideoplatformsfocusoncostreductionandefficiencyimprovement,andtheiroperatinglosseshavenarrowedsignificantly.Since2022,thelossesofiQiyi,BilibiliandKuaishouhaveallnarrowedsignificantly,andtheoperatingprofitsofiQiyiandKuaishou'sdomesticbusinesseshaveturnedpositive.AsoneofthefirstenterprisesinthevideoposecostreductionandefficiencyimprovementiQiyiindicatedinQthattheoutsourcedcontentwasbecomingeWiththemanagementfurtherindicatingthatthelongvideoindustryhasenteredanewstageofpursuingefficiency,lossreductionandultimatelyprofit,iQiyi'soperatingprofitmarginincreasedfrom-13.2%in4Q21to4.1%in3Q22.InSeptember2021,KuaishouadjusteditsorganizationalstructuretoiciencyKuaishousoperatingprofitrateincreasedfromin4Q21to-11.3%in3Q22,amongwhichtheoperatingprofitofdomesticbusinesswasprofitablefortwoconsecutivequartersinQQBilibilihasalsograduallyshifteditsfocustocostreductionandefficiencyimprovementsince2022,whoseoperatingprofitmarginin22Q3improvedby12.7pptscomparedwith2Q22.FigureBilibiliiQiyiandKuaishousoperatingmarginsimprovedsignificantlyin2022Bilibili(%)iQiyi(%)Kuaishou(%)%-20%-23.7%-30%--23.7%-30%-29.3%-31.9%-34.6%-40%--40%-50%Source:theCompanies,GuotaiJunanInternational.SeethelastpagefordisclaimerPage9of15Media&CultureSectorMedia&CultureSector传播文化行业SectorReport45%PMedia&CultureSectorCostswereeffectivelycontrolledwhilethequantityandqualityofvideoplatformusersimproved.Intermsofcost-cuttingmeasures,iQiyimainlyreducedcontentcosts,whileBilibiliandKuaishoumainlycutsalesandmarketingexpenses.AfterthenumberofsubscriberspeakediQiyipaidmoreattentiontocostcontrolandtheincreaseofcustomerunitprice.TheproportionofcontentcostinrevenuedecreasedfrominQtoinQandfurtherdroppedtoinQComparedwithtmodelisrelativelymatureBilibiliandKuaishouarestillinthestageofrapidgrowthTheyhaveputhighersalesandmarketingexpensesin2020-2021toattractnewusers.Afterimplementingthestrategyofimprovingprofitefficiency,themarketingexpenseratioofBilibilidroppedfrom30.5%in4Q21to21.2%in3Q22,andthatofKuaishoudroppedfrom53.8%of3Q21to39.5%of3Q22.Whileslashingmarketingexpenses,BilibiliandKuaishoumaintainedgrowthofhigh-qualityusers.InomninQwhileKuaishousMAUincreasedbyYoYtomnduringthesameperiod.Intermsofuserengagement,averagedailytimespentonBilibiliandKuaishouwas96minutesand129minutes,respectively,withYoYgrowthof9.1%and8.6%,respectively,hittingtheirrespectiverecordhighs.Inaddition,both226December2022tingthatlowermarketingexpenseratiodidnotserengagementGiventheeffectofcostreductionandefficiencyimprovementofvideoplatformsweexpectfuturetabilitytocontinuetoimprovewiththerecoveryofthemacroeconomyFigure-9:OperatingprofitmarginsofiQiyi,KuaishouFigure-10:Bilibili’sKuaishou’sMAUandYoYgrowthofandBilibilibyquarterMAUiQiyi(%)Bilibili(%)iQiyi(%)Kuaishou(%)Bilibili(%)80%70%65.0%60%41.9%41.9%39.5%40%30.5%30.5%26.2%21.2%21.2%17.1%14.8%0%66.3%57.6%16.0%14.0%14.366.3%57.6%16.0%14.0%14.3%80%70%60%50%40%30%20%10%0%Source:theCompanies,GuotaiJunanInternational.Source:theCompanies,GuotaiJunanInternational.Figure-11:OperatingprofitmarginsofiQiyi,KuaishouFigure-12:Bilibili’sKuaishou’sMAUandYoYgrowthofandBilibilibyquarterMAUBilibili'sMAU(mn)Bilibili(%)Kuaishou(%)Kuaishou'sMAU(mn)700YoYgrowthofBilibili'sMAU(%,RHS)80% YoYgrowthofKuaishou'sMAU(%,RHS)60070%0%55.9%58.1%55.9%58.1%51.1% 50%40%29.5%329.5%26.6%27.1%20%%0 60% 50%4000200..424.5%.5%%2 0% 20%9.% 00%Source:theCompanies,GuotaiJunanInternational.Source:theCompanies,GuotaiJunanInternational.SeethelastpagefordisclaimerPage10of15Media&CultureSectorMedia&CultureSector传播文化行业SectorReportPMedia&CultureSector2.3.ATurningPointofProfitabilityforShortVideoPlatformsLivestreaminge-commerceeffectivelydrivestheincrementalmarketofonlineshopping,whichmaybecomethemosteffectivewayforshortvideoplatformstomonetize.AccordingtothedataofiResearch,themarketscaleoflivestreamingxpectedtoreachRMBbninwithaYoYgrowthofMeanwhilethepenetrationrateoflivestreamingecommercereached%inChina'sonlineshoppingmarketand7.6%inChina'stotalsocialretailsales.Shortmthroughpublicdomaintrafficadvertisingwhichismorepushandtargeted,andhelpstopromoteconsumptionbehavior.AccordingtoiResearch,brandself-broadcastisexpectedtoaccountfor47.3%oflivestreaminge-commercein2022,anditmaybeequalwiththelivestreamingofprofessionalbroadcastingtalentsiningecommerceisthefirstcomprehensiveecommerceplatformtomaturewejudgethatshortvideoplatformrelyingontrafficadvantages,willbecomeanimportantincreaseinlivestreaminge-commerce.226December20222.4.ShortVideoE-commerceGainsIncrementalGrowthfromNicheMarketTheCovid-19pandemichasaffectedadvertisers'willingnesstoinvest,andthegrowthoftheInternetadvertisingmarketsloweddownin2022.AccordingtoQuestMobile'sdata,the1H22InternetadvertisingmarketwasRMB290.4bn,down2.3%YoY,asadvertisersbecomemorecautiousabouttheiradvertisingbudgetsduetoresurgencesinCovid-19.QuestMobilepredictedthe2H22InternetadvertisingmarketsizetobeRMB391.3bn,up9.4%YoY,thustheannualInternetadvertisingmarketsizeisexpectedtobeRMB681.7bnin2022,up4.1%YoY.AstheCovid-19pandemichasdisruptedthedomesticsupplychain,shortvideoadvertisinghasincreasinglybecomeamajorchoiceforadvertisers.AccordingtoQuestMobile,theproportionofadvertisingrevenuefromshortvideoandsocialnetworkingcontinuedtoincreasein1H22.Amongthetopfivetypesofadvertisers,theshortvideoadsofthethreeverticalindustriesofbeauty,personalcareandcommunitydatingaccountedformorethan40%oftheirtotaladvertising.Althoughtheoverallpriceofshortvideoadvertisingisrelativelyhigh,itseffectivenessofbrandmarketingandconversionratearesignificantlyaheadofotherchannelsofadvertisingWithadvertisersbudgetstightthistrendcouldcontinueuntil2023.FigureTheCompositionofMediainChina'sOnlineAdvertisingIndustryE-commerceADShortvideoADOnlinevideoADSocialADPan-c