External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>Tencent reported 3Q23 financial results on 15 Nov: total revenue grew 10% YoY to RMB154.6bn, inline with our/consensus estimate.</li><li>Non-IFRS net income grew by 39% YoY to RMB44.9bn in 3Q23, beating our/consensus estimate by 11/12%, mainly due to the solid GPM expansion across business lines.</li><li>3Q23 GPM expanded by 5.2ppt YoY to 49.5% (vs. consensus’ 47.5%) on the strong operating leverage and incremental revenue from higher-margin innovative businesses (i.e. Mini Games and Video Accounts etc). </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

Tencent reported 3Q23 financial results on 15 Nov: total revenue grew 10% YoY to RMB154.6bn, inline with our/consensus estimate.Non-IFRS net income grew by 39% YoY to RMB44.9bn in 3Q23, beating our/consensus estimate by 11/12%, mainly due to the solid GPM expansion across business lines.3Q23 GPM expanded by 5.2ppt YoY to 49.5% (vs. consensus’ 47.5%) on the strong operating leverage and incremental revenue from higher-margin innovative businesses (i.e. Mini Games and Video Accounts etc). Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Tencent  (700 HK) – 3Q23 Earnings Beat on Strong Operating Leverage and Business Innovation

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Thematic (Sector/Industry)

<ul>
<li>BABA/ JD/ PDD/ 1024.HK/ ZTO/ 1519.HK: Double 11 eCommerce update (+)</li>
<li>BABA/BIDU/700HK: Alibaba Cloud crashed for several hours during the weekend (-/+/+)</li>
<li>On November 12, 2023 Alibaba Cloud reportedly crashed for several hours, and in the process resulted in outages for Alibaba services and customer websites that stopped functioning properly.</li>
</ul>


BABA/ JD/ PDD/ 1024.HK/ ZTO/ 1519.HK: Double 11 eCommerce update (+)
BABA/BIDU/700HK: Alibaba Cloud crashed for several hours during the weekend (-/+/+)
On November 12, 2023 Alibaba Cloud reportedly crashed for several hours, and in the process resulted in outages for Alibaba services and customer websites that stopped functioning properly.


[Blue Lotus Daily] BABA/JD/PDD/1024.HK/ZTO/1519.HK/BIDU/Tencent 700.HK

Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> ’s 3Q2023 revenues fell marginally below consensus, however, OP beat consensus estimates. Domestic games returned to growth after a flat quarter in 2Q2023.</li>
<li>Both Online Advertising and Fintech businesses have seen strong increase in top line with GPM approaching new highs for the two businesses.</li>
<li>Though Tencent’s earnings show a recovery, we would remain cautious given the slowdown in Chinese economy and Tencent failing to make into new game approval list since July 2023.</li>
</ul>



Tencent (700 HK) ’s 3Q2023 revenues fell marginally below consensus, however, OP beat consensus estimates. Domestic games returned to growth after a flat quarter in 2Q2023.
Both Online Advertising and Fintech businesses have seen strong increase in top line with GPM approaching new highs for the two businesses.
Though Tencent’s earnings show a recovery, we would remain cautious given the slowdown in Chinese economy and Tencent failing to make into new game approval list since July 2023.


Tencent: Domestic Gaming Returns to Growth

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>Advertising, international game, and Fintech grew by two digits, but domestic entertainments were stagnant.</li>
<li>The gross margins of all business lines improved and admin expense as percentage of total revenue decreased.</li>
<li>We believe the stock has an upside of 30% for the year end of 2024.</li>
</ul>


Advertising, international game, and Fintech grew by two digits, but domestic entertainments were stagnant.
The gross margins of all business lines improved and admin expense as percentage of total revenue decreased.
We believe the stock has an upside of 30% for the year end of 2024.


Tencent (700 HK): Raise Margin Estimates After 3Q23 Results, 30% Upside, Buy

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zeekr-intelligent-technology-holding" target="_blank" data-smartkarma-citation="entities:36785:1" rel="noopener">ZEEKR</a>, a premium EV brand by <a href="https://www.smartkarma.com/entities/geely-automobile-holdings-ltd" target="_blank" data-smartkarma-citation="entities:127:1" rel="noopener">Geely Auto (175 HK)</a>, aims to raise around US$500m in its US listing.</li>
<li>Zeekr was formed in Mar 2021 as a JV between Geely and its founder. Its first model was launched in Apr 21 with deliveries starting in Oct 21.</li>
<li>In this note, we talk about the not-so-positive aspects of the deal.</li>
</ul>



ZEEKR, a premium EV brand by Geely Auto (175 HK), aims to raise around US$500m in its US listing.
Zeekr was formed in Mar 2021 as a JV between Geely and its founder. Its first model was launched in Apr 21 with deliveries starting in Oct 21.
In this note, we talk about the not-so-positive aspects of the deal.


Zeekr Pre-IPO - The Negatives - Remains Highly Dependent on Geely

China

Tencent Holdings Limited operates as an investment holding company. The Company, through its subsidiaries, provides Internet and mobile value-added services (VAS), online advertising, and e-commerce transactions. Tencent Holdings offers services to users worldwide.

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Tencent (700 HK)

Tencent (700 HK) – 3Q23 Earnings Beat on Strong Operating Leverage and Business Innovation

Tencent reported 3Q23 financial results on 15 Nov: total revenue grew 10% YoY to RMB154.6bn, inline with our/consensus estimate.

CMB International

[Blue Lotus Daily] BABA/JD/PDD/1024.HK/ZTO/1519.HK/BIDU/Tencent 700.HK

Double 11 eCommerce update;Alibaba Cloud reportedly crashed for several hours during last weekend, third-party Alibaba Cloud Customers were also...

Blue Lotus Research Institute

Tencent: Domestic Gaming Returns to Growth

Tencent's domestic games returned to growth in 3Q2023 after a flat 2Q, social networks remained flat. Key highlight of the quarter was strong...

Shifara Samsudeen, ACMA, CGMA

Tencent (700 HK): Raise Margin Estimates After 3Q23 Results, 30% Upside, Buy

Advertising, international game, and Fintech grew by two digits, but domestic entertainments were stagnant. The gross margins of all business lines...

Ming Lu

Zeekr Pre-IPO - The Negatives - Remains Highly Dependent on Geely

ZEEKR, a premium EV brand by Geely Auto (175 HK), aims to raise around US$500m in its US listing. In this note, we talk about the not-so-positive...

Sumeet Singh

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52-week Range

Market Cap (USDm)

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Tencent (700 HK) – 3Q23 Earnings Beat on Strong Operating Leverage and Business Innovation

Tencent reported 3Q23 financial results on 15 Nov: total revenue grew 10% YoY to RMB154.6bn, inline with our/consensus estimate.

CMB International

[Blue Lotus Daily] BABA/JD/PDD/1024.HK/ZTO/1519.HK/BIDU/Tencent 700.HK

​Double 11 eCommerce update;Alibaba Cloud reportedly crashed for several hours during last weekend, third-party Alibaba Cloud Customers were also...

Blue Lotus Research Institute

Tencent: Domestic Gaming Returns to Growth

​Tencent's domestic games returned to growth in 3Q2023 after a flat 2Q, social networks remained flat. Key highlight of the quarter was strong...

Shifara Samsudeen, ACMA, CGMA

Tencent (700 HK): Raise Margin Estimates After 3Q23 Results, 30% Upside, Buy

Advertising, international game, and Fintech grew by two digits, but domestic entertainments were stagnant. The gross margins of all business lines...

Ming Lu

Zeekr Pre-IPO - The Negatives - Remains Highly Dependent on Geely

ZEEKR, a premium EV brand by Geely Auto (175 HK), aims to raise around US$500m in its US listing. In this note, we talk about the not-so-positive...

Sumeet Singh

Double 11 eCommerce update;Alibaba Cloud reportedly crashed for several hours during last weekend, third-party Alibaba Cloud Customers were also...

Tencent's domestic games returned to growth in 3Q2023 after a flat 2Q, social networks remained flat. Key highlight of the quarter was strong...