In today’s briefing:
- Naspers X Prosus (NPN, PRX): Market Reacts Negatively to Appointment of CEO
- [Tencent (700 HK, BUY, TP HK$450) TP Change]: Market Finally Starting to Recognize Tencent’s Value
- JD.com (9618 HK): 1Q24 Results On Track
Naspers X Prosus (NPN, PRX): Market Reacts Negatively to Appointment of CEO
- Naspers and Prosus have announced the appointment of Fabrício Bloisi as Group CEO, effective from 1 July 2024. Unlike his predecessor, Bloisi has an entrepreneurial background.
- Prosus and Naspers have sold off on the news. Prosus is down 1.7%, widening the discount by 80bps. Naspers is down 1.3%, widening the discount by 50bps.
- Since Bob van Dijk stepped down in September last year, both discounts have narrowed.
[Tencent (700 HK, BUY, TP HK$450) TP Change]: Market Finally Starting to Recognize Tencent’s Value
- Tencent reported C1Q24 revenue, IFRS operating profit, and IFRS net income in-line, 9.1%, 26% vs. our estimates and in-line, 16%, 21% vs. consensus;
- Game revenues were below our expectations while advertising was above, leading to a gross margin beat of 2.73ppt, powered by video account and AI.
- We raised our TP to HK$450 to reflect the shift to better-margin revenue mix and upcoming revenue acceleration.
JD.com (9618 HK): 1Q24 Results On Track
- JD.com (9618 HK) announced a set of in-line results for 1Q24. Sales growth was 7% yoy, in-line with my 1Q24 preview.
- Operating profit margin for the core JD retail business declined by 0.5ppt yoy to 4.1%, which is also in-line with my preview.
- The positive surprise was a big reduction in losses in the JD logistics business, which brought the overall non-GAAP net profit growth to 17% yoy for 1Q24.
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