The digital marketing industry chain will be fully deployed, and M&A expectations will remain in the future. Investors' understanding of Wanrun Technology is still stuck in the traditional LED packaging business. We believe that Wanrun Technology is accelerating the transformation of its leading digital marketing media company. In the 14-15 years, Wanrun Technology successively acquired and increased the capital of Sunshine Optoelectronics, Auman, Yiwan Wireless and Dingsheng Yixuan, and gradually realized the layout of the digital marketing industry chain. The trend is obvious. There are still merger and acquisition expectations in the future. .
The digital marketing market has a large space, and the development trend of the industry requires an extension of development. It is estimated that the scale of China's Internet advertising market will grow from 78.2 billion yuan in 2012 to more than 400 billion yuan in 2018, with an average compound annual growth rate of 33% and huge market space. The digital marketing industry is gradually showing the trend of diversified marketing forms, downstream customer decentralization and integration of marketing services. The three major trends require strong technology, talents, experience accumulation and customer stickiness, so companies in the industry want To be stronger and bigger, we must take the path of extensional development. Wanrun Technology's series of capital increase and acquisition are in full compliance with the industry trend of the whole industry chain.
Wanrun Technology's layout integrates digital machine marketing downstream customers and upstream media, and the synergy effect is remarkable. In 2014, the company acquired Rishang Optoelectronics and entered the digital marketing field. In 2015, it successively increased its capital and acquired Yishengyixuan and Yiwan Wireless. Dingsheng Yixuan specializes in desktop search engine services, big data services and new media marketing services. Billion Wireless is mainly engaged in mobile Internet advertising. Through a series of capital increase acquisitions, the company now has a customer platform covering multiple industries, a mid-stream advertising company providing multiple services, and a media platform with multiple media channels.
LED packaging and application legacy business revenue maintenance. The LED industry is gradually maturing, competition within the industry is fierce, and the integration trend is obvious. It is expected that the future revenue of Wanrun Technology LED packaging and application business will maintain the previous level. The revenue in 15-17 is 5.9, 5.81 and 550 million yuan respectively, and the net profit is 0.41, 0.33 and 0.33 billion.
It is estimated that its original LED and infrared receiver business revenue in 2015-2017 is 5.9, 5.81, 550 million yuan, net profit is 0.41, 0.29, 0.28 billion yuan, and will be promised by Auman, Botu, Yiwan Wireless and Dingshengyixuan. After the profit is taken into account, the net profit of the 15-17 returning mothers reached 1.4, 1.58, and 196 million. Considering that the company newly issued 0.26 billion shares in November 2015, the fully diluted earnings per share were 0.52, 0.59, and 0.74 yuan. The current stock price corresponds to 62x, 54x, 43x PE in 2015-2017.
In terms of LED business, considering the negative growth of revenue of Wanrun Technology LED business in the next three years, the company has given the company a 21-fold minimum PE in the past 16 years, corresponding to a market value of 700 million. In terms of digital marketing, the company's commitments in the 15-17 years were 0.98, 1.29, and 168 million, a year-on-year growth rate of 31% and 30%. Comparable to the company's 15-16 years PEG was 3.3, 3.5, net profit growth rate of 45%, 37%, giving the company digital marketing business 15-16 years of PEG is 3.1, 3, PE is 96, 90, 2016 corresponding market value of 11.6 billion. Based on the above segment valuation, the company's target market value in 2016 was 12.3 billion yuan.
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