Hundred-Vision Company to set up joint ventures with Microsoft

News of the stock message Hundred-Vision (600637, shares) 24th announced that the company and Microsoft intend to jointly invest 79 million U.S. dollars, about 483 million yuan, the establishment of the Shanghai Hundred Information Technology Development Co., Ltd. (tentative name), the company's operating period of 10, the proposed registration for the Shanghai Free Trade test area.　　The company will design, develop, produce games, entertainment applications and derivative products, sales, licensing, marketing and production of Third-party games, entertainment applications and game consoles related technical advice and services for the main business. The cooperation, the two sides will come up with their own business-related core resources, in the new generation of home game entertainment technology, terminals, content, services and other fields to launch a comprehensive cooperation.　　Among them, the company intends to invest 40.29 million U.S. dollars in cash, about 246 million yuan, a shareholding of 51%, Microsoft intends to invest 38.71 million U.S. dollars in cash, about 237 million yuan, holding 49%. According to the National Policy framework of "China (Shanghai) Free trade test area" through this joint venture, the company aims to create a first-class "new generation of home game entertainment products" and a world-class "home entertainment center Service", which will promote companies in China and overseas "a cloud of multiple screens　　"Business related technology, platform, terminal, content, network, service capabilities of the overall upgrade, promote the company's game industry in the field of layout, to achieve the company's new media" Cross-regional "," cross-industry "development on a new level for the prosperity of the global family culture and entertainment efforts. Vision: Looking forward to cross-border strategic cooperation and extension of expansion rating categories: Corporate Research Institute: Guotai Researcher: Gaohui Tang Zhiyan Lin Lin Guide: Maintain "overweight" rating.　　Industry in the recent emergence of a large number of strategic cooperation, we believe that the company's own new media broadcasting and control platform and resource advantages are obvious, cross-border strategic cooperation is worth looking forward to, raise the target price to 50 yuan. Investment points: We maintain the "overweight" rating, up to 12-month target price to 50 yuan, the increase of 25%, the reason for the new media industry into a strong cross-border strategic cooperation and industry integration stage, the company development space, cooperation and extension of the expansion of the expected increase, We expect the company's market capitalisation to exceed 50 billion in the next 12 months (compared to the company's Netflix market capitalisation of $18 billion).　　Maintain the company's earnings forecast 2013-2015 EPS0.67 yuan, 0.93 yuan, 1.19 yuan. We note that video new media industry, the important changes in the recent emergence of a number of deep-seated, cross-industry strategic cooperation, such as Archie and TCL Cooperative Intelligent TV, Millet and Cntv launched the box and intelligent TV, Alibaba and the number of Chinese cooperation to launch the box, and Skyworth launched Smart TV,　　The company will also announce details of cooperation with Tencent at the September 23 release meeting. Recommended company reasons: 1, to SMG as the background of the TV station resources +iptv+ott+ video site New media content operating platform has been basically2, in Beijing, Hunan and other cable networks strong regional telecommunications operators have also begun to vigorously promote IPTV business, the end of the year-end settlement user number is expected to exceed expectations, we maintain the company's annual growth of about 40% of the forecast, the Premier League live video on Demand business is PPV on demand for more than expected factors;　　Company's own new media broadcast control platform and resource advantages are obvious, with internet companies at home and abroad to carry out high-level strategic cooperation of the capital; 4, the company book in hand cash of about 1.9 billion, operating cash flow in good condition, has the ability to expand expansion.　　Catalysts: The use of their own advantage resources of high-level strategic cooperation, the reasonable extension of the expansion of mergers and acquisitions. Main risk hint: the cost risk of rising copyright content price; Internet video competition is fierce.