Citi maintains Shanda game buying rating says profitability is undervalued

On the afternoon of January 12, Citigroup released its investment report today, reiterating the "buy" rating of Shanda Games (Nasdaqgs:game) shares and maintaining its 12.50 dollar target share price unchanged. The following is a summary of the report: reaffirm the Buy rating and the 12.50 dollar target share price: Shanda Games announced a series of growth plans at the beginning of the new Year, we hereby give our views on its recent developments. Given the reliable strategic implementation of Shanda and the low risk of profitability, we believe that investors underestimate the profitability of Shanda's game, and that its share price has experienced slight fluctuations over the past few months. We reaffirm the buying rating of the Shanda game and the 12.50 dollar target share price.　　For those investors who want to invest in the field of online gaming but cannot afford the risk of a game release, we think Shanda is a good choice. Acquisition of Mochi Media: Shanda Games announced today that it will buy the leading web gaming platform Mochi Media with a 60 million dollar cash plus 20 million dollar grand gaming stock. Mochi Media is an open platform that provides distribution and services for 15,000 flash games from more than 3,000 developers. According to the public data, Mochi currently has an independent active user of 140 million per month. We believe that most of its revenue comes from advertising, and only a small portion comes from the micro-transaction payments business. The latter business was launched last June and players can buy game props through Mochi. The deal is expected to be completed within the first quarter of 2010. The Grand game will be held in the US Eastern Time January 12 morning 8 o'clock/Hong Kong Time 9 o'clock in the evening Analyst conference call.　　Users can call: 1.866.850.2201/800.966.243 to listen to the conference call, the password is: 1430562. Buy the Golden Cool game: The acquisition of the Golden Cool game is the largest in the past 3 years, the third largest local acquisition, after July 2007 of the acquisition of Kam-day technology and the July 2009 Simo Tech Acquisition. Golden Cool Game was founded in 2003, currently operates 3 games, respectively, "Magic World", "princes" and "Zodiac Legends", and 3 games are about to be released, respectively, "Zodiac Legends Dream Fairyland", "Demon World 2" and "Descendants of the Dragon." We believe that this acquisition is a grand game to expand the product portfolio, to obtain more "exportable" game content, thereby enhancing the overseas licensing strategy as part of.　　At present, the "Magic Circle" and "princes" have been overseas versions, and has been in South Korea and China's Taiwan region into operation. and Jinshan set up a joint venture and the "Swordsman 3" cooperation: in addition to the end of last December announced will and Jinshan cooperation operation "Swordsman World" and "Swordsman 3", the Grand game also announced, will be together with Jinshan set up a joint venture to jointly develop network games. Details of the joint venture have not yet been disclosed. We believe that the two sides will each contribute 50%, the joint venture will initially participate inTo the Grand edition of "Swordsman 3" adjustment. The team of Shanda Games will provide operational experience and feedback to the JV company to improve the quality of the existing games in Jinshan.　　For "Swordsman 3", we expect Shanda games to be released in 1 to 3 quarters. New game Authorization: "Bubble Fighter" and "Legend 3"-Shanda game has been allowed to operate the "Bubble fighter", which is a "run kart" and "Bubble Hall" in the famous role of the development of the leisure shooting game. Considering the popularity of "running kart" in the Chinese market, we believe that the Bubble fighter can also attract the same loyal users. In addition, after the Chinese net Game group's contract expires, the Shanda game will also be allowed to operate "Legend 3".　　We believe that the "Legend 3" will be able to the grand game of the "Blood legend" play an expanding role, but the contribution will not be great. The "Blood Legend" of the film Authority: Shanda has announced that it has been allowed to shoot a movie based on the storyline of Legend 2. We believe that the grand game is not prepared to film their own films, but by virtue of cooperation with local television stations to achieve. We believe that the purpose of this move is mainly to promote and expand the "Legend 2" to enhance the game's life cycle. Otherwise, its parent company's Grand Network (Nasdaqgs:snda) had previously set up a joint venture with Hunan Radio and television to create film and TV projects would be confusing. (Ding Macro)