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

[Tencent (700 HK, BUY, TP HK$450) TP Change]: "DNF Mobile" And Strong Ads Are Two Catalysts

China/Asia TMT

Shawn Yang

Equity Bottom-Up

<ul>
<li>Tencent reported 2Q23 revenue/non-IFRS net income (2.5%)/2.3% vs cons. Gaming was weaker than the street expected, while online advertising beat.</li>
<li>We expect gaming growth will improve slightly while advertising growth will decelerate in 3Q. </li>
<li>We maintain BUY but cut TP to HK$ 402 to reflect online gaming weakness.</li>
</ul>


Tencent reported 2Q23 revenue/non-IFRS net income (2.5%)/2.3% vs cons. Gaming was weaker than the street expected, while online advertising beat.
We expect gaming growth will improve slightly while advertising growth will decelerate in 3Q. 
We maintain BUY but cut TP to HK$ 402 to reflect online gaming weakness.


[Tencent (700 HK, BUY, TP HK$402) TP Change]: Cut TP to HK$ 402 to Reflect Weakness in Gaming