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.

Thematic (Sector/Industry)

<ul><li>We update our sector investment views for the next six months post earnings as follows: 1) Companies with solid fundamentals and high revenue and profit growth visibility; 2) sustained profitability and willingness to lift shareholder returns; and 3) a sizeable TAM for new initiatives and business explorations likely to generate a decent ROIC.</li><li>We believe the market will continue to allocate to such names and value them fairly.</li><li>Taking into account 2Q results and recent stock performances, we find our previous view has been testified: better-than-expected earnings are not enough to drive a share rally, but better-than-expected 3Q/full-year outlook and enhanced shareholder return measures could provide key support. </li></ul>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.

We update our sector investment views for the next six months post earnings as follows: 1) Companies with solid fundamentals and high revenue and profit growth visibility; 2) sustained profitability and willingness to lift shareholder returns; and 3) a sizeable TAM for new initiatives and business explorations likely to generate a decent ROIC.We believe the market will continue to allocate to such names and value them fairly.Taking into account 2Q results and recent stock performances, we find our previous view has been testified: better-than-expected earnings are not enough to drive a share rally, but better-than-expected 3Q/full-year outlook and enhanced shareholder return measures could provide key support. 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.

Internet - 2Q24 Recap & Stock-Picking Ideas: Seeking Certainty

<ul><li>Year to date, the internet sector has pulled back after rapid rallies buoyed by improved sentiment and short-term fund inflows, in line with our previous expectation.</li><li>From a full-year perspective, given the rate cut cycle has not yet started and liquidity remains tight, we suggest focusing on: 1) companies capable of boosting shareholder returns or maintaining decent returns, supported by solid fundamentals (strong competitive advantages, steady growth in core business, and stable profitability) and committed to enhancing shareholder returns (also depends on management's willingness), such as Alibaba, Tencent, and NetEase;</li><li>2) companies whose new businesses have significant market potential and are poised to bring considerable capital gains in the long run, particularly from overseas expansion and AI-related initiatives, such as Pinduoduo, Tencent, Alibaba, and Trip.com</li></ul>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.

Year to date, the internet sector has pulled back after rapid rallies buoyed by improved sentiment and short-term fund inflows, in line with our previous expectation.From a full-year perspective, given the rate cut cycle has not yet started and liquidity remains tight, we suggest focusing on: 1) companies capable of boosting shareholder returns or maintaining decent returns, supported by solid fundamentals (strong competitive advantages, steady growth in core business, and stable profitability) and committed to enhancing shareholder returns (also depends on management's willingness), such as Alibaba, Tencent, and NetEase;2) companies whose new businesses have significant market potential and are poised to bring considerable capital gains in the long run, particularly from overseas expansion and AI-related initiatives, such as Pinduoduo, Tencent, Alibaba, and Trip.comContent 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.

Internet - 1Q24 recap & our three stock-picking ideas

<ul><li>Based on NBS data, 2M24 online retail sales GMV/online physical goods GMV reached RMB2.2tn/1.8tn, up 15.3/14.4% YoY, which implied a two-year CAGR of 10.7/9.8%.</li><li>The growth of total online retail sales GMV continued to outpace that of online physical goods GMV, which was likely due to the robust growth in online travel bookings during the CNY holiday.</li><li>Leading e-commerce platforms are prioritizing GMV and revenue growth over margin improvement in 2024, and guided to reinvest incremental operating profit generated to drive further business growth, which likely indicates more intensified industry competition. </li></ul>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.

Based on NBS data, 2M24 online retail sales GMV/online physical goods GMV reached RMB2.2tn/1.8tn, up 15.3/14.4% YoY, which implied a two-year CAGR of 10.7/9.8%.The growth of total online retail sales GMV continued to outpace that of online physical goods GMV, which was likely due to the robust growth in online travel bookings during the CNY holiday.Leading e-commerce platforms are prioritizing GMV and revenue growth over margin improvement in 2024, and guided to reinvest incremental operating profit generated to drive further business growth, which likely indicates more intensified industry competition. 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.

Internet - 2M24 online retail sales recap

Equity Bottom-Up

<ul><li>TME reported in-line 3Q23 results on 14 Nov: total revenue declined by 11% YoY and 10% QoQ to RMB6.6bn mainly on soft social entertainment business, versus consensus/our estimate of RMB6.4/6.3bn; non-IFRS net income was up 2% YoY to RMB1.41bn, in line with consensus/our estimate of RMB1.42/1.37bn.</li><li>Core music subscription revenue growth further accelerated to +42% YoY in 3Q23 (vs. 1Q23/2Q23 +30/37% YoY &amp; consensus +37% YoY), driven by solid growth of both paying users and ARPPU.</li><li>Looking ahead, we forecast total revenue to decline by 10% YoY to RMB6.7bn in 4Q23E, due to the persisting impact of social entertainment business adjustment. </li></ul>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.

TME reported in-line 3Q23 results on 14 Nov: total revenue declined by 11% YoY and 10% QoQ to RMB6.6bn mainly on soft social entertainment business, versus consensus/our estimate of RMB6.4/6.3bn; non-IFRS net income was up 2% YoY to RMB1.41bn, in line with consensus/our estimate of RMB1.42/1.37bn.Core music subscription revenue growth further accelerated to +42% YoY in 3Q23 (vs. 1Q23/2Q23 +30/37% YoY &amp; consensus +37% YoY), driven by solid growth of both paying users and ARPPU.Looking ahead, we forecast total revenue to decline by 10% YoY to RMB6.7bn in 4Q23E, due to the persisting impact of social entertainment business adjustment. 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.

TME (TME US) – Inline 3Q23 results; strong music subscription revenue growth

<ul><li>TME announced 2Q23 financial results on 15 Aug. Total revenue grew by 5.5% YoY and 4.0% QoQ to RMB7.3bn in 2Q23, in line with CMBI/consensus estimate of RMB7.2/7.3bn.</li><li>Non-IFRS net income was up 48.6% YoY to RMB1.5bn in 2Q23, also in line with CMBI/consensus estimate.</li><li>Its online music revenue growth was ahead of consensus expectations by 8% due to solid music subscription growth and ad business recovery; but its social entertainment revenue was 12% below consensus due to TME’s risk control measures implemented in 2Q23. </li></ul>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.

TME announced 2Q23 financial results on 15 Aug. Total revenue grew by 5.5% YoY and 4.0% QoQ to RMB7.3bn in 2Q23, in line with CMBI/consensus estimate of RMB7.2/7.3bn.Non-IFRS net income was up 48.6% YoY to RMB1.5bn in 2Q23, also in line with CMBI/consensus estimate.Its online music revenue growth was ahead of consensus expectations by 8% due to solid music subscription growth and ad business recovery; but its social entertainment revenue was 12% below consensus due to TME’s risk control measures implemented in 2Q23. 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.

TME (TME US) – Improving profitability despite pressure on social entertainment business

China

Tencent Music Entertainment operates an online music entertainment platform in China. The Company offers platform that comprises of online music, recording, music-centric live streaming enabling users to discover, listen, sing, watch, perform, and socialize music.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Tencent Music (TME US)

Internet - 2Q24 Recap & Stock-Picking Ideas: Seeking Certainty

We update our sector investment views for the next six months post earnings as follows: 1) Companies with solid fundamentals and high revenue and...

CMB International

Internet - 1Q24 recap & our three stock-picking ideas

Year to date, the internet sector has pulled back after rapid rallies buoyed by improved sentiment and short-term fund inflows, in line with our...

CMB International

Internet - 2M24 online retail sales recap

Based on NBS data, 2M24 online retail sales GMV/online physical goods GMV reached RMB2.2tn/1.8tn, up 15.3/14.4% YoY, which implied a two-year CAGR...

CMB International

TME (TME US) – Inline 3Q23 results; strong music subscription revenue growth

Looking ahead, we forecast total revenue to decline by 10% YoY to RMB6.7bn in 4Q23E, due to the persisting impact of social entertainment business...

CMB International

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Internet - 2Q24 Recap & Stock-Picking Ideas: Seeking Certainty

We update our sector investment views for the next six months post earnings as follows: 1) Companies with solid fundamentals and high revenue and...

CMB International

Internet - 1Q24 recap & our three stock-picking ideas

Year to date, the internet sector has pulled back after rapid rallies buoyed by improved sentiment and short-term fund inflows, in line with our...

CMB International

Internet - 2M24 online retail sales recap

Based on NBS data, 2M24 online retail sales GMV/online physical goods GMV reached RMB2.2tn/1.8tn, up 15.3/14.4% YoY, which implied a two-year CAGR...

CMB International

TME (TME US) – Inline 3Q23 results; strong music subscription revenue growth

Looking ahead, we forecast total revenue to decline by 10% YoY to RMB6.7bn in 4Q23E, due to the persisting impact of social entertainment business...

CMB International

TME (TME US) – Improving profitability despite pressure on social entertainment business

TME announced 2Q23 financial results on 15 Aug. Total revenue grew by 5.5% YoY and 4.0% QoQ to RMB7.3bn in 2Q23, in line with CMBI/consensus...

CMB International