Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

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

Thematic (Sector/Industry)

<ul>
<li>JD US/DADA US/3690 HK:JD.com Upgrades "Hour Delivery" to "Instant Delivery", reflecting strong growth potential in the on-demand retail sector.(+)</li>
<li>700 HK: &lt;Honors of Fighters&gt; will be released on May 24th.(+)</li>
<li>ZTO US/1519 HK/PDD US/BABA US/Douyin: PDD launches new product price competitiveness rules (+/+/-/-/-)</li>
</ul>


JD US/DADA US/3690 HK:JD.com Upgrades "Hour Delivery" to "Instant Delivery", reflecting strong growth potential in the on-demand retail sector.(+)
700 HK: &lt;Honors of Fighters&gt; will be released on May 24th.(+)
ZTO US/1519 HK/PDD US/BABA US/Douyin: PDD launches new product price competitiveness rules (+/+/-/-/-)


[Blue Lotus Daily - TMT Update]:JD US/DADA US/3690 HK/700 HK/ZTO US/1519 HK/PDD US/BABA US/Douyin

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> reported 1Q2024 results today. Both revenues and OP grew 6.3% and 30.0% YoY respectively and beat consensus estimates.</li>
<li>Though domestic games revenues declined YoY, there were signs of recovery in Tencent’s gaming business. Online advertising saw strong growth despite 1Q being a seasonally weak quarter for Tencent.</li>
<li>Tencent’s investments in high-margin products have helped boost the company’s margins across all business segments.</li>
</ul>



Tencent (700 HK) reported 1Q2024 results today. Both revenues and OP grew 6.3% and 30.0% YoY respectively and beat consensus estimates.
Though domestic games revenues declined YoY, there were signs of recovery in Tencent’s gaming business. Online advertising saw strong growth despite 1Q being a seasonally weak quarter for Tencent.
Tencent’s investments in high-margin products have helped boost the company’s margins across all business segments.


Tencent: Online Advertising and High-Margin Businesses Support Earnings

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>The operating margin in 1Q24 reached the highest since 2Q16, as the gross margins of all businesses improved.</li>
<li>The growth rate of online advertising is high than our estimate, but the growth rate of FinTech is lower than our estimate.</li>
<li>We believe there is still an upside of 9% and the price target will be HK$415 for the end of 2024.</li>
</ul>


The operating margin in 1Q24 reached the highest since 2Q16, as the gross margins of all businesses improved.
The growth rate of online advertising is high than our estimate, but the growth rate of FinTech is lower than our estimate.
We believe there is still an upside of 9% and the price target will be HK$415 for the end of 2024.


Tencent (700 HK): 1Q24, Highest Margin in Seven Years

Quantitative Equity Analyst, DMA

Charlotte van Tiddens, CFA

Quantitative Equity Analyst

Technology-First Company

DMA is a technology-first company that provides an end-to-end SaaS solution to institutional investors. DMA enables regulated entities like asset managers, wealth managers, investment managers and financial advisors to connect their front and back office, break silos and reduce headcount.

Event-Driven

<ul>
<li>Tencent reported a decent set of results for Q1 FY24. Revenue for the quarter was up 2.8% QoQ and 6.3% YoY, ahead of consensus estimates (2.3% &amp; 5.9%).</li>
<li>The gross margin came in at 53%, 3 percentage points ahead of consensus, and an increase of 7 percentage points on Q1 FY23.</li>
<li>The gross margin for the Fintech and Business Services segment, which accounts for 33% of revenue, increased by 12 percentage points to 46% (consensus 42.6%).</li>
</ul>


Tencent reported a decent set of results for Q1 FY24. Revenue for the quarter was up 2.8% QoQ and 6.3% YoY, ahead of consensus estimates (2.3% &amp; 5.9%).
The gross margin came in at 53%, 3 percentage points ahead of consensus, and an increase of 7 percentage points on Q1 FY23.
The gross margin for the Fintech and Business Services segment, which accounts for 33% of revenue, increased by 12 percentage points to 46% (consensus 42.6%).


Tencent (700 HK): Q1 FY24 Results Quick Take, Margin Expansion Drives Decent Set of Results

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.</li>
<li>The final results for the June 2024 index rebal event will be confirmed after market close on Friday 17th May 2024.</li>
<li>In this insight, we take a look at our latest flow expectations.</li>
</ul>


The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
The final results for the June 2024 index rebal event will be confirmed after market close on Friday 17th May 2024.
In this insight, we take a look at our latest flow expectations.


Quiddity HSTECH Jun 24 Final Expectations: US$1.6bn One-Way; Li Auto, JD, Xiaomi, Meituan, & Tencent

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 (700 HK)

[Blue Lotus Daily - TMT Update]:JD US/DADA US/3690 HK/700 HK/ZTO US/1519 HK/PDD US/BABA US/Douyin

JD.com upgrades "Hour Delivery" to "Instant Delivery" showing growth potential in on-demand retail; new game to release May 24th; PDD introduces...

Blue Lotus Research Institute

Tencent: Online Advertising and High-Margin Businesses Support Earnings

Tencent's 1Q earnings beat consensus. Though online games declined there were signs of recovery. Online ad saw strong growth despite 1Q being...

Shifara Samsudeen, FCMA, CGMA

Tencent (700 HK): 1Q24, Highest Margin in Seven Years

The operating margin in 1Q24 reached the highest since 2Q16, as the gross margins of all businesses improved. The growth rate of online advertising...

Ming Lu

Tencent (700 HK): Q1 FY24 Results Quick Take, Margin Expansion Drives Decent Set of Results

Tencent reported a decent set of results for Q1 FY24, driven by notable margin expansion across segments (well ahead of consensus estimates).

DMA

Quiddity HSTECH Jun 24 Final Expectations: US$1.6bn One-Way; Li Auto, JD, Xiaomi, Meituan, & Tencent

I estimate one-way flow to be US$1,585mn which translates to a turnover of roughly 8.3%. I do not expect any constituent changes for the HSCEI June...

Janaghan Jeyakumar, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Blue Lotus Daily - TMT Update]:JD US/DADA US/3690 HK/700 HK/ZTO US/1519 HK/PDD US/BABA US/Douyin

​JD.com upgrades "Hour Delivery" to "Instant Delivery" showing growth potential in on-demand retail; new game to release May 24th; PDD introduces...

Blue Lotus Research Institute

Tencent: Online Advertising and High-Margin Businesses Support Earnings

Tencent's 1Q earnings beat consensus. Though online games declined there were signs of recovery. Online ad saw strong growth despite 1Q being...

Shifara Samsudeen, FCMA, CGMA

Tencent (700 HK): 1Q24, Highest Margin in Seven Years

The operating margin in 1Q24 reached the highest since 2Q16, as the gross margins of all businesses improved. The growth rate of online advertising...

Ming Lu

Tencent (700 HK): Q1 FY24 Results Quick Take, Margin Expansion Drives Decent Set of Results

Tencent reported a decent set of results for Q1 FY24, driven by notable margin expansion across segments (well ahead of consensus estimates).

DMA

Quiddity HSTECH Jun 24 Final Expectations: US$1.6bn One-Way; Li Auto, JD, Xiaomi, Meituan, & Tencent

I estimate one-way flow to be US$1,585mn which translates to a turnover of roughly 8.3%. I do not expect any constituent changes for the HSCEI June...

Janaghan Jeyakumar, CFA

JD.com upgrades "Hour Delivery" to "Instant Delivery" showing growth potential in on-demand retail; new game to release May 24th; PDD introduces...