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>For 3Q22E, social entertainment platforms still face intensifying competition and macro challenges that can weigh on their revenue growth and margin expansion.</li><li>Social entertainment platforms need to innovate their monetization methods and enhance operating efficiency in order to fend off competition and macro headwind, in our view.</li><li>Platforms with concentrated revenue exposure to ad business like Weibo and loss-making platforms like BiliBili (Bili) might be more sensitive to the competition and macro environment.</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>

For 3Q22E, social entertainment platforms still face intensifying competition and macro challenges that can weigh on their revenue growth and margin expansion.Social entertainment platforms need to innovate their monetization methods and enhance operating efficiency in order to fend off competition and macro headwind, in our view.Platforms with concentrated revenue exposure to ad business like Weibo and loss-making platforms like BiliBili (Bili) might be more sensitive to the competition and macro environment.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.

China Internet– Social Entertainment 3Q22 Preview: Remains Under Pressure

<div><div><div><div><ul><li>Consumption sentiment and offline activities’ recovery pace continued to weigh on internet sector’s 3Q financials performance.</li><li>Looking into 4Q and 2023, business model robustness, operating leverage improvement, and ability to expand into new revenue streams will be the key stock alpha drivers, while the heavily under-owned China Internet sector will remain sensitive to policies and other sentiment related beta drivers.</li><li>We expect leading technology companies will play vital role in building digital infrastructure and empowering enterprise digital transformation. </li></ul></div></div></div></div><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>

Consumption sentiment and offline activities’ recovery pace continued to weigh on internet sector’s 3Q financials performance.Looking into 4Q and 2023, business model robustness, operating leverage improvement, and ability to expand into new revenue streams will be the key stock alpha drivers, while the heavily under-owned China Internet sector will remain sensitive to policies and other sentiment related beta drivers.We expect leading technology companies will play vital role in building digital infrastructure and empowering enterprise digital transformation. 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.

China Internet Sector – 3Q22 preview: near term bumpy recovery

Equity Bottom-Up

<ul><li>NetEase reported 2Q25 results: total revenue increased by 9% YoY to RMB27.9bn, 2% below Bloomberg consensus estimate; non-GAAP net income was up by 22% YoY to RMB9.5bn, largely in line with consensus estimate.</li><li>We expect the slower-than-expected games revenue growth to impact short-term investor sentiment, but we also note that the games revenue outlook in 2H25E remains resilient (+13% YoY on our estimate), supported by the solid performance of evergreen games and strong growth of contract liabilities in 2Q25 (+25% YoY).</li><li>We maintain our FY25-27 earnings forecasts largely unchanged. </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>

NetEase reported 2Q25 results: total revenue increased by 9% YoY to RMB27.9bn, 2% below Bloomberg consensus estimate; non-GAAP net income was up by 22% YoY to RMB9.5bn, largely in line with consensus estimate.We expect the slower-than-expected games revenue growth to impact short-term investor sentiment, but we also note that the games revenue outlook in 2H25E remains resilient (+13% YoY on our estimate), supported by the solid performance of evergreen games and strong growth of contract liabilities in 2Q25 (+25% YoY).We maintain our FY25-27 earnings forecasts largely unchanged. 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.

NetEase (NTES US) - Inline 2Q25 Earnings; Upbeat on 2H25 Game Business Outlook

Head of Research, Krungthai XSpring

Waraporn Wiboonkanarak

Head of Research

A full service Thai brokerage

Krungthai XSpring

Krungthai XSpring is a full service broker. The company provides a wide range of investment services such as Securities Brokerage, Derivative Agent Business, Securities Borrowing and Lending, Securities Trading, Underwriting, Financial Advisory, Wealth Advisory, Private Fund Management and International Markets Securities Trading. 

In terms of credibility, Fitch Ratings has assigned Krunghtai XSpring a long-term rating of AA- and a national short-term rating of F1+ with stable outlook.

<ul><li>The KTX Tactical DR Picks increased the investment position in NETEASE80, which is based on NetEase, Inc., a gaming business in China listed on the Hong Kong Stock Exchange.</li><li>The average price of the underlying securities in the portfolio declined slightly by -0.27%, while US stock markets were closed last night for Memorial Day.</li></ul>

The KTX Tactical DR Picks increased the investment position in NETEASE80, which is based on NetEase, Inc., a gaming business in China listed on the Hong Kong Stock Exchange.The average price of the underlying securities in the portfolio declined slightly by -0.27%, while US stock markets were closed last night for Memorial Day.

KTX Tactical DR Picks - May 27, 2025 (Eng.)

<ul><li>NetEase announced 1Q25 results: total revenue grew by 7% YoY to RMB28.8bn, largely in line with consensus estimate.</li><li>Operating profit increased by 37% YoY to RMB10.4bn, 25% ahead of consensus estimate, mainly due to the disciplined opex control (-14% YoY).</li><li>Games business regains momentum, with reaccelerating and better-than-expected revenue growth in 1Q25 (+12% YoY), and the strong growth of contract liabilities in 1Q25 (+19%/16% YoY/QoQ) should support the growth of games revenue in the coming quarters, in our view. </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>

NetEase announced 1Q25 results: total revenue grew by 7% YoY to RMB28.8bn, largely in line with consensus estimate.Operating profit increased by 37% YoY to RMB10.4bn, 25% ahead of consensus estimate, mainly due to the disciplined opex control (-14% YoY).Games business regains momentum, with reaccelerating and better-than-expected revenue growth in 1Q25 (+12% YoY), and the strong growth of contract liabilities in 1Q25 (+19%/16% YoY/QoQ) should support the growth of games revenue in the coming quarters, in our view. 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.

NetEase (NTES US) - Strong 1Q25 Results on Solid Games Business and Disciplined Opex Control

China

NetEase, Inc. is an Internet technology company that develops applications, services and other Internet technologies in China. The Company's core businesses consist of email service, web portal and online entertainment, including online gaming services. NetEase also offers online advertising, search, mobile applications and e-commerce.

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NetEase Inc (NTES US)

China Internet Sector – 3Q22 preview: near term bumpy recovery

We expect leading technology companies will play vital role in building digital infrastructure and empowering enterprise digital transformation.

CMB International

NetEase (NTES US) - Inline 2Q25 Earnings; Upbeat on 2H25 Game Business Outlook

We lift our SOTP-derived target price to US$160.0 (previous: US$136.5), given the valuation rerating of the games sector. Maintain BUY on solid...

CMB International

KTX Tactical DR Picks - May 27, 2025 (Eng.)

The KTX Tactical DR Picks increased the investment position in NETEASE80, which is based on NetEase, Inc., a gaming business in China listed on...

Krungthai XSpring

NetEase (NTES US) - Strong 1Q25 Results on Solid Games Business and Disciplined Opex Control

In view of the solid business performance of games, we raise FY25-27E revenue forecast by 2-6%. We lift our SOTP-derived target price to US$136.5...

CMB International

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China Internet– Social Entertainment 3Q22 Preview: Remains Under Pressure

For 3Q22E, social entertainment platforms still face intensifying competition and macro challenges that can weigh on their revenue growth and...

CMB International

China Internet Sector – 3Q22 preview: near term bumpy recovery

We expect leading technology companies will play vital role in building digital infrastructure and empowering enterprise digital transformation.

CMB International

NetEase (NTES US) - Inline 2Q25 Earnings; Upbeat on 2H25 Game Business Outlook

We lift our SOTP-derived target price to US$160.0 (previous: US$136.5), given the valuation rerating of the games sector. Maintain BUY on solid...

CMB International

KTX Tactical DR Picks - May 27, 2025 (Eng.)

The KTX Tactical DR Picks increased the investment position in NETEASE80, which is based on NetEase, Inc., a gaming business in China listed on...

Krungthai XSpring

NetEase (NTES US) - Strong 1Q25 Results on Solid Games Business and Disciplined Opex Control

In view of the solid business performance of games, we raise FY25-27E revenue forecast by 2-6%. We lift our SOTP-derived target price to US$136.5...

CMB International