花旗-中国网络游戏研究

gloomilliam

Contents

Executive Summary  3
Recommendation Summary  5
Sector Overview  7
Industry structure  7
How will sector’s structural change affect investor expectations?  10
Online gaming – a key entertainment form in China  12
Quasi-SNS for low-end Internet population  13
Stable fundamentals of online games  17
Key Risks  23
Valuation  25
Changyou.com (CYOU)  26
Initiate Top Pick; Diversified Approach To Drive Re-Rating  26
Giant Interactive Group (GA)  39
Initiate at Buy: Making the Smart Money  39
Perfect World (PWRD)  53
Initiate at Buy: Deeply Undervalued; The Key Will Be Catalysts  53
Shanda Games (GAME)  70
Initiate at Neutral (2H): Wait-and-See Story  70
NetEase.com (NTES)  82
Initiate at Neutral: A Leading Online Gaming Powerhouse, But
Already Fully Valued  82
Appendix A-1  100