Our target price of Rmb23.0 is based on 28x P/E on FY2025E EPS. The 28x P/E multiple is comparable to other A-share media names after the recent China media sector re-rating. We believe a PE-based valuation best captures the near- to medium-term performance of movie and entertainment companies such as Enlight Media.

We assign a High Risk rating to Enlight Media shares given the stock is deemed to be relatively volatile by our quantitative risk rating model (based on stock price movements in the past year). Key downside risks that could impede Enlight Media from reaching our target price include (i) box-office receipts for upcoming movies fall below expectations; (ii) integration issues with new businesses; and (iii) TV variety shows face intense competition.