Avior Capital Markets - Tencent Holdings Ltd. (00700) Tencent | Respawned

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Avior Capital Markets

Charl Wolmarans ...

Kevin Mattison

Tencent | Respawned

Tencent's gaming growth accelerated to deliver its quickest quarterly growth (11% y/y) since the gaming monetisation freeze started in early 2018. In addition, the Group launched ten new mobile games during the quarter. However, concerns about the US-China trade war continues to influence Tencent (-14% since 2019 high in Apr '19) in line with global tech peers. Tencent's continued focus on expenses which protects margins is encouraging. The Group has refined its focus on its existing portfolio, implying a slowing in its investment portfolio which we value at USD c.75bn. We believe the drawdowns in Tencent's share price deliver buying opportunities as we expect Tencent to deliver 21% CAGR non-GAAP diluted EPS over the next five years.

19/08/2019 13 EN

Underlying

Tencent Holdings Ltd.

Tencent Holdings Limited is an investment holding company principally involved in the provision of value-added services (VAS) and online advertising services. The Company operates through three main segments. The VAS segment is mainly involved in provision of online/mobile games, community value-added services and applications across various Internet and mobile platforms. The Online Advertising segment is mainly engaged in display based and performance based advertisements. The Others segment is mainly involved in provision of payment related services, cloud services and other services.

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KYG875721634 Hong Kong Stock Exchange Cayman Islands

Provider

Avior Capital Markets

Avior is a globally recognised capital markets research and trading firm, with the broadest research coverage within the region, with 100+ SA and 20+ SSA companies under coverage. Avior services clients from offices in London, Cape Town and Johannesburg.

Our research quality is consistently recognised in local and global surveys, with 18 analysts currently rated in their respective sectors (FM 2017). Value add through in-depth, innovative, high quality and consistent research with comprehensive underlying fundamental modelling supported by regular analyst and roadshow interactions.

Avior has proven that by working closely with our clients we can mutually develop dominant positions in certain sectors, going from strength to strength. Avior has a dedicated ESG team, having been ranked #1 in Corporate Governance research since 2008.

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Analysts

Charl Wolmarans

Kevin Mattison

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