Music video Super TV is expected to become a new profit point

Hand over the global foundry giant Foxconn news stimulated the Music network (300104, shares bar) yesterday's stock performance, early disc music network once impact trading, as close up 7.56%, reported 28.46 Yuan.

Le Video Network held a press conference said that with the Foxconn Technology Group to reach strategic cooperation, video TV Super TV and Internet set-top box products will provide a full range of solutions, in addition to the two sides will also set up joint ventures, Foxconn promised no longer for other Internet companies to do related terminal manufacturing.

Super TV is expected to be a new profit point

From the business structure, advertising business is still the company's main support, in the third to fourth quarter of 2012, advertising revenue to achieve a single quarter of billion, the fourth quarter advertising revenue more than 150 million yuan, and again in the main business income accounted for more than 40%;

However, the video network is very optimistic about the development prospects of Super TV, that Super TV is not only smart TV, but the future direction of television development. Pettibone Securities that the introduction of the video TV Super TV, for the "platform + content + Terminal + Application" of the entire industry chain added to the "last screen", marking the Lok Vision has been built a complete ecosystem. In 2013, the company will launch a new marketing model of the video TV, triggering the outbreak of TV end year, 2013-Year Plan TV end and box sales scale breakthrough million units, become the company's new profit growth point.

Le video hope Super TV can marvel at the world like Apple. From the perspective of the application of Super TV, television as a necessity to extend to each family, has a huge market potential, figures show that the 2011 China market TV total sales of 50 million units, the total sales market size of 200 billion. But the video network and other pure Intelligent TV terminals are different, its terminal channel can achieve good interaction with the network.

However, it is noteworthy that the Lok Video network IPO financing has been depleted in 2010, the current company's development of the short board is the cash flow is more tense, in the period of financial expenses should be significantly increased. Pettibone Securities has said that the Super TV project will need to invest 500 million ~15 billion yuan in the next 1-2 years, and only by the existing funds of the video network is difficult to meet this demand.

Double the late need to be cautious

Since the end of last year's more powerful, the share price rose from 13.91 to now more than 28 yuan, the rise has doubled.

Citic Securities (600030, shares bar) in accordance with the company EPs 0.48/0.70/1.01 Yuan and give 49/33/23 times times PE, the previous target price is only 24.5 yuan. Pettibone Securities believes that we continue to be optimistic about the flow and content advantages of the company's advertising business continued to grow, as well as the music video TV and box to bring the new profit growth point, to 2013 43 times times PE, the target price: 29.67 yuan.

Analysts point out that at present, the video network in the net profit and Super TV concept stimulated, stock prices have risen sharply, the current high valuations, now need to pay attention to the video network in the late set-top box and TV terminal layout, especially if the super TV can reach market expectations, the final product can be "amazing world", After this wave of news, investors need to remain cautious in the short term.