Jinghua Mountain One: Jinshan In addition to online games and anti-virus has greater potential

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Beijing time September 26 afternoon news, the Hong Kong Jinghua Mountain Securities released today research report said, in addition to online games and anti-virus software business, Jinshan Software has more potential, which includes the development of other applications, WPS to attract more business customers, as well as with Tencent and millet possible strategic cooperation.

The following is the full report:

Stock price Catalyst

1. The potential of Internet Information security software is released

Jinshan new management is taking good strategic steps to use Jinshan poison PA This powerful anti-virus software to dabble in other Internet applications. Although the first half of this year's Golden Hill application business revenue growth of 101%, but we believe that, with the Golden Hill Guards, Cheetah Browser and Jinshan fast cloud services to increase the number of users, Jinshan will also have a variety of commercial channels, and these channels have not been fully developed.

2. The newly contracted WPS Enterprise user

About WPS Office software, recently Jinshan has with some state-owned enterprises major clients signed, including ICBC, ABC and PetroChina. Management expects that the proportion of WPS revenue from business and government customers will gradually change from the previous 30%/70% to 50%/50%. Jinshan Management expects that WPS's annual revenue growth rate will reach 20%.

3. Strategic cooperation with Tencent and millet

Investors speculated that Jinshan would work strategically with its main shareholder, Tencent and Chairman Lei. At present, Jinshan has been with Tencent on micro-letter cloud computing services to cooperate. At the same time, Lei's ambitious goal for Millet will bring business opportunities to Jinshan.

Valuation

We believe that each business valuation and summation method is still suitable for Jinshan. For Jinshan's online gaming business, we give the 2013-year forward-looking earnings ratio 18 times times. The remaining market value is mainly from the application software business (Jinshan poison PA and WPS). The market value of the business is justified by reference to the market value of Qihoo.

Our view

Under the leadership of the new management, Jinshan is beginning to fully release the commercial potential. The re-rating of Jinshan will be based on the gradual development of Jinshan poison PA business. And the online business based on the model of the developer, Jinshan Management's goal is to create a high-level software platform. A successful internet platform will have a higher valuation because the growing user base will become a commercial gold mine.