Guotai Haitong: Initiates VOBILE GROUP (03738) with "Overweight" rating, target price HK$6.5

Guotai Haitong issued a research report stating that the bank estimates VOBILE GROUP's (03738) EPS for 2026-2028 to be HK$0.13, HK$0.17, and HK$0.20, respectively. With reference to comparable companies, the bank assigns the company a 2026 dynamic PE valuation of 50x, corresponding to a target price of HK$6.5, and initiates coverage with an "Overweight" rating. Guotai Haitong's main points are as follows: As a globally leading digital content rights confirmation and transaction service provider, it drives business development through a dual-engine model of "subscription protection + value-added monetization" VOBILE GROUP is a globally leading platform and service provider for digital content asset protection and transactions. The company was founded in Silicon Valley, USA, in 2005 and completed its listing on the Hong Kong Stock Exchange in 2018. Its subscription services are built on self-developed video DNA digital fingerprinting, watermarking, and multimodal recognition technologies, adopting two models: regular subscription and API usage-based calls. It provides copyright monitoring, piracy identification, and copyright management services to content owners and platforms worldwide, supporting infringement identification, platform content review, and ecosystem governance. In 2026, its business expanded into areas such as micro short dramas, music, games, and sports events. In the first half of 2026, revenue was HK$718 million, a year-on-year increase of 17.7%, accounting for 39.8% of total revenue. The value-added business relies on the Rights ID and Channel ID products launched in 2019, providing services such as rights revenue sharing, channel operations, and content distribution to overseas social and video platforms. It can identify IP derivative UGC content on platforms such as YouTube and complete advertising revenue sharing, achieving element-level recognition and dissemination data analysis in the AI era. In the first half of 2026, value-added and other services revenue was HK$1.087 billion, a year-on-year increase of 28.5%, accounting for 60.2% of total revenue, making it the core growth engine. In the AI era, it has built a complete closed-loop ecosystem from content creation to rights confirmation and monetization In addition to providing content services to platforms and content owners, the company, based on two decades of accumulated rights confirmation, monitoring, and revenue-sharing capabilities, has launched two major platforms, Vobile MAX and Dream Maker, building a complete closed-loop ecosystem from content creation to rights confirmation and monetization in the AI era. On September 3, 2026, the company disclosed that its subsidiary had reached a strategic cooperation with Brunei's UNN and obtained 25 megawatts of data center capacity with conditions for deploying AI computing power, using liquid cooling and high-power-density technology, to establish and operate an "AI factory" driven by an advanced AI computing system based on NVIDIA computing cores. The bank believes that the company's business is extending from digital copyright software services upstream to computing power, which is expected to support the expansion of the Dream Maker platform, strengthen the full-chain capabilities of AI content creation, rights confirmation, and monetization, and serve the film and television industry and creator communities. Risk warnings Risks of AI business expansion falling short of expectations, industry policy and copyright compliance risks, and competition risks in the copyright content market.