(Original title: Tencent’s stock price returns to HK$400, hits a rebound high, institutions are optimistic about the strong recovery of the game business)
News from the Financial Associated Press on January 26 (edited by Ma Yijie)On the first trading day after the festival, the stock price of Tencent Holdings (00700.HK) regained the 400 Hong Kong dollar mark, hitting a new high in nearly 11 months since March 2022. As of press time, Tencent rose 3.16% to 404.2 Hong Kong dollars, with a turnover of more than 6 billion Hong Kong dollars.
On the news side, CITIC Securities recently released a research report saying that under the influence of the epidemic, Tencent’s revenue growth in the fourth quarter of 2022 will still be under pressure. But looking forward to 2023, after the optimization of the epidemic policy, with the accelerated commercialization of video accounts and the successive launch of new games, the company’s performance is expected to gradually resume growth. At the same time, cost reduction and efficiency enhancement continue to advance, and the profit side is expected to further improve.
CITIC Securities predicts that Tencent’s revenue in the fourth quarter of 2022 may reach 141.9 billion yuan, a quarter-on-quarter increase of 1.3%; gross profit margin increased by 4.7 percentage points to 44.8%; single-quarter net profit is expected to reach 28.8 billion yuan, a year-on-year growth rate of 15.7%.
It is worth noting that Tencent has recently been stimulated by continuous positive news in the game business, and is expected to return to growth.
It is reported that Tencent’s new game “Goddess of Victory: NIKKE” in November performed well. Since September 2022, blockbuster products such as “Fearless Contract”, “Dawn Awakening: Vitality”, and “Metal Slug: Awakening” have all successfully obtained version numbers.
Morgan Stanley, an international investment bank, also pointed out in a previous report that the game business will be one of the catalysts for Tencent’s revenue growth this year, and the continuous acquisition of game authorization by major IPs is a key highlight. Benefiting from the recovery of game growth and the strong volume of the video account business, Tencent is expected to achieve a year-on-year positive growth of about 1% in the fourth quarter of last year.
In addition, data shows that Tencent was sought after by public funds in the fourth quarter of last year. As of the fourth quarter of 2022, Tencent Holdings has entered the list of heavy holdings of 371 active equity funds.