Edited by: Peng Shuiping
The broader market rebounded unilaterally throughout the day, and the micro-cap stock index, which fell for two consecutive days, led the gains. On the disk, the afternoon disk was not alarmed, most of the industry bears were absent to maintain a high level of shock, banks, machinery and other heavy stocks adjusted in the morning followed up the rally, and the Agricultural Bank of China and the Bank of China hit a record high. More than 5,000 shares were in the red throughout the day, and more than 200 shares were up and down, and the market returned to normal after the regulator responded urgently to the issue of dividends and delisting.
As of the close, the Shanghai Composite Index rose 2.14% to 3071.38 points, and the Film and Television ETF (516620) rose 5.11%.
Source: wind
Reason analysis: improved market sentiment + AI-empowered film and television production tools continue to innovate
The improvement in market sentiment is an important factor. The "Opinions on the Strict Implementation of the Delisting System" issued by the China Securities Regulatory Commission put forward strict delisting standards, and increased the "zombie shell" and "black sheep" to clear out, and there was a panic decline in the first two trading days of this week, and the market returned to normal after the regulator responded urgently to the issue of dividends and delisting. From March 25 to April 16, the film and television ETF (516620) fell as much as 21%, but today's rally shows the market's confidence in the sector has returned. Investors' expectations for the recovery of the industry, as well as the growth potential brought by the application of new technologies, have driven the rise of film and television ETFs to a certain extent. Follow-up vigilance on the continuous impact of delisting doubts on small and micro disks, short-term volatility may increase, long-term optimistic about the growth space of the sector, it is recommended to pay attention to dips.
Analysis of the long-term investment value of film and television
[The continuous recovery of the film market]
In 2024, the comprehensive box office of Qingming files (April 4 to April 6) will reach 842 million yuan, setting a box office record for Qingming files in Chinese film history. The May 1st box office is expected to continue to recover. The film market is gradually picking up, and the summer season of 2023, New Year's Day of 2024, Spring Festival and Qingming Festival all hit new highs at the box office in Chinese film history. The 2024 May Day (May 1-May 5) movie involves a total of 11 new films, including 2 imported films, a decrease compared with 2023, and the movies cover a wide range of genres, including comedy, action, romance, suspense, crime, comedy, animation and other genres, which can meet the needs of many moviegoers. The mainland film market is still in the recovery stage, and more high-quality films are expected to be finalized after the release of the stock film list. The box office during the Qingming period exceeded expectations, and the long-tail effect was superimposed, indicating the recovery trend of the film and television industry. In addition, the schedule broke out across the board in the first half of the year, and the introduction of films and high-quality IP reserves made the follow-up schedule still highly anticipated by the market.
[Micro-short dramas, video games, and MR are expected to bring new increments]
Micro-short dramas also need to be high-quality, and technological innovation creates more possibilities. In 2023, the policy will once again encourage "a hundred flowers to bloom", and new content forms such as micro-short dramas and live-action interactive video games will usher in rapid development. At the same time, AI video represented by Sora continues to iterate, and MR represented by VisionPro opens a new era of spatial computing.
During the Spring Festival, "I Was a Stepmother in the 80s" was small and broad, and the short drama shooting took only 10 days, and 80,000 yuan was invested in the later stage, and together with "Mr. Pei thinks about his father and son every day", he won more than 100 million recharge income. It can be seen that global content consumption has shifted from long-term entertainment to short-term entertainment, and from whole-time consumption to fragmented consumption. The explosive dramas and amazing income have attracted a large number of giants to "cross the industry", from the short video platform Douyin and Kuaishou to the long video platform iQiyi and Tencent, and the market scale and capacity have expanded dramatically. According to iiMedia Consulting data, the market size of China's online micro-short dramas in 2023 will be 37.39 billion yuan, a year-on-year increase of 267.65%, and the market size is expected to reach 100.68 billion yuan in 2027.
Apple's entry into the game has greatly promoted the layout of MR by developers, and there will be new MR products such as Meta and Sony in the future, and content and applications are expected to prosper with the hardware boom. As one of the main functions of MR equipment, the film and television entertainment function may be redefined by MR, which will open up the growth space of film and television in the future.
[AI empowerment, continuous innovation of film and television production tools]
In March, nearly half of the TOP20 global AI application growth list were domestic products, of which the two phenomenal products of Mita AI and Kimi ranked the top 2.
The catalysis of domestic AI applications continues. On April 17, 2024, "Tiangong 3.0" will officially open the public beta, which adopts a 400 billion-level parameter MoE hybrid expert model, and will simultaneously choose open source. The C-end application "Tiangong AI Intelligent Assistant" supports AI search/creation and other functions. The domestic application side catalysis continues. (1) SenseTime will release version 5.0 of the "RiRixin" large model, (2) Aishi Technology has reached a strategic cooperation with KLCII, (3) Peking University's open-source and strongest aiXcoder-7B code large model, which is specially designed for enterprise-level software development scenarios, (4) Wanwu has launched "Wanzhi;(", 5) Byte's AI education application "Gauth" has exceeded 100 million users and exceeded 2 million daily active users, and (6) Tencent Cloud has launched the AIGC cloud storage solution, which is specially designed for AI large model storage needs.
AI continues to empower film and television production, improving content accuracy and production efficiency. With the continuous development of film and television production tools, the production efficiency of video content continues to improve. In addition to multimodal AI tools that can be directly used to create video content, applications such as AI 3D tools and XR virtual shooting equipment can continue to improve the accuracy and efficiency of content production. Taking XR shooting technology as an example, it can save the cost of actually building scenes, including venue rental, construction, props, etc., while saving time and improving production efficiency. For example, the high-quality short drama "Seven Lives" uses virtual shooting, compared with traditional shooting methods, its special effects time is shortened by 10 months, and the cost is halved, so as to achieve a significant increase in efficiency.
【Outlook for the future】At present, the sector is undervalued, and the long-term value of the film and television sector is valued
After experiencing the previous correction, the film and television ETF has become cost-effective, attracting the attention of investors and the inflow of funds. From March 25 to April 16, the film and television ETF (516620) fell as much as 21%, but today's rally shows the market's confidence in the sector has returned. Investors' expectations for the recovery of the industry, as well as the growth potential brought by the application of new technologies, have driven the rise of film and television ETFs to a certain extent. After a period of adjustment, the overall valuation level of the film and television industry is relatively low. With the improvement of industry fundamentals, the market has re-evaluated the valuation of film and television stocks, and valuation repair has become another driving force for the rise of film and television ETFs.
Figure: Historical PE/PB - Negative values excluded
Source: wind
From an investment perspective, it has basically retraced to the level of mid-2022. With the recovery of the industry + the volume of new formats (micro-short dramas, film games, MR, etc.) + AIGC cost reduction and efficiency increase, considering the acceleration of the commercial application of AIGC, the expectation of industry recovery and the expectation of performance improvement, the recovery of market sentiment is expected to promote the repair of the industry's valuation. Short-term volatility may increase, long-term optimistic about the growth space of the sector, it is recommended to pay attention to the film and television ETF (516620) on dips.
National Business Daily