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

<div><div><div><div><ul><li>We expect Tencent’s 4Q22E results to be largely inline with our previous forecasts, except slightly severe impact on ad and FBS businesses from opening-up in Dec 2022.</li><li>We slightly adjust FY22/4Q22E total revenue forecast down by 1/3%; but remain positive on the revenue recovery trajectory in FY23/24E, due to consumption recovery which should benefit Tencent’s consumer internet business, incremental contribution from Video Account monetization, and quality games pipeline.</li><li>We raise FY23/24E non-IFRS net income forecast by 1/2%, reflecting improved outlook of high-margin gaming and ad businesses, which should lead to better GPM in FY23/FY24E. </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>

We expect Tencent’s 4Q22E results to be largely inline with our previous forecasts, except slightly severe impact on ad and FBS businesses from opening-up in Dec 2022.We slightly adjust FY22/4Q22E total revenue forecast down by 1/3%; but remain positive on the revenue recovery trajectory in FY23/24E, due to consumption recovery which should benefit Tencent’s consumer internet business, incremental contribution from Video Account monetization, and quality games pipeline.We raise FY23/24E non-IFRS net income forecast by 1/2%, reflecting improved outlook of high-margin gaming and ad businesses, which should lead to better GPM in FY23/FY24E. 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) – What next to look forward to?

<ul><li>Tencent announced 3Q22 results on 16 Nov. Total revenue declined by 1.6% YoY but grew by 4.5% QoQ to RMB140.1bn in 3Q22, in line with consensus/our estimate of RMB141.4/140.6bn.</li><li>9M22 revenue was down by 1.5% YoY. Quarterly Non-IFRS net income grew 1.6% YoY after the decline for 4 consecutive quarters, and reached RMB32.3bn in 3Q22, beating consensus estimate by 7%.</li><li>The earning beat was mostly helped by effective control in S&amp;M expenses (-32% YoY) &amp; staff costs (low single-digit YoY growth excl. one-off severance costs).</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 announced 3Q22 results on 16 Nov. Total revenue declined by 1.6% YoY but grew by 4.5% QoQ to RMB140.1bn in 3Q22, in line with consensus/our estimate of RMB141.4/140.6bn.9M22 revenue was down by 1.5% YoY. Quarterly Non-IFRS net income grew 1.6% YoY after the decline for 4 consecutive quarters, and reached RMB32.3bn in 3Q22, beating consensus estimate by 7%.The earning beat was mostly helped by effective control in S&amp;M expenses (-32% YoY) &amp; staff costs (low single-digit YoY growth excl. one-off severance costs).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) – Return to earnings growth track

<div><div><div><div><ul><li>Tencent is deploying its WeChat ecosystem, which we expect will disrupt consumer internet industry competition and partially offset slowing macro impact.</li><li>Infrastructure to support real economy industries, such as enterprise and fintech services, overseas markets development will be Tencent’s growth drivers for the long run.</li><li>Due to revenue exposure to high ROE consumer internet business, revenue recovery coupled with Opex optimization will stabilize earning from 2023 onwards. </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>

Tencent is deploying its WeChat ecosystem, which we expect will disrupt consumer internet industry competition and partially offset slowing macro impact.Infrastructure to support real economy industries, such as enterprise and fintech services, overseas markets development will be Tencent’s growth drivers for the long run.Due to revenue exposure to high ROE consumer internet business, revenue recovery coupled with Opex optimization will stabilize earning from 2023 onwards. 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) – Ecosystem Value and Growing Diversification

<div><div><div><div><ul><li>Weibo is the fourth largest social media platform by MAUs in China (behind Tencent/ Douyin/Kuaishou), with 582mn MAUs and 43% DAU/MAU ratio as of June 2022.</li><li>Weibo has established unique proposition to advertisers with its large user base and vibrant KOL community.</li><li>It provides advertisers with differentiated brand-plus-performance marketing solutions with relatively high ROI. </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>

Weibo is the fourth largest social media platform by MAUs in China (behind Tencent/ Douyin/Kuaishou), with 582mn MAUs and 43% DAU/MAU ratio as of June 2022.Weibo has established unique proposition to advertisers with its large user base and vibrant KOL community.It provides advertisers with differentiated brand-plus-performance marketing solutions with relatively high ROI. 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.

Weibo (WB US) – Navigate Short-Term Headwind

<ul><li>Meta hosted the Meta Connect 2022 on 11 Oct, launching its first high-end VR headset Meta Quest Pro.</li><li>The new VR headset will begin shipping on 25 October for US$1,499.99.</li><li>With innovative features like pancake lenses, eye tracking, natural facial expressions and colour passthrough, Meta Quest Pro will meaningfully enhance the social/gaming/work VR experience 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>

Meta hosted the Meta Connect 2022 on 11 Oct, launching its first high-end VR headset Meta Quest Pro.The new VR headset will begin shipping on 25 October for US$1,499.99.With innovative features like pancake lenses, eye tracking, natural facial expressions and colour passthrough, Meta Quest Pro will meaningfully enhance the social/gaming/work VR experience 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.

China Internet Sector – Meta Connect 2022: bridging the gap towards metaverse

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 Holdings (ADR) (TCEHY US)

Tencent (700 HK) – What next to look forward to?

We expect Tencent’s 4Q22E results to be largely inline with our previous forecasts, except slightly severe impact on ad and FBS businesses from...

CMB International

Tencent (700 HK) – Return to earnings growth track

Total revenue declined by 1.6% YoY but grew by 4.5% QoQ to RMB140.1bn in 3Q22, in line with consensus/our estimate of RMB141.4/140.6bn.

CMB International

Tencent (700 HK) – Ecosystem Value and Growing Diversification

Tencent is deploying its WeChat ecosystem, which we expect will disrupt consumer internet industry competition and partially offset slowing macro...

CMB International

Weibo (WB US) – Navigate Short-Term Headwind

Weibo is the fourth largest social media platform by MAUs in China (behind Tencent/ Douyin/Kuaishou), with 582mn MAUs and 43% DAU/MAU ratio as of...

CMB International

China Internet Sector – Meta Connect 2022: bridging the gap towards metaverse

With innovative features like pancake lenses, eye tracking, natural facial expressions and colour passthrough, Meta Quest Pro will meaningfully...

CMB International

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