TENCENT(00700) 申万宏源·2024-06-28 03:01Investment Rating - The report maintains a "Buy" rating for the company, indicating a strong expectation of performance exceeding the market by over 20% [15][25]. Core Insights - The first month revenue of the "DNF Mobile Game" exceeded expectations, with projections suggesting an annual revenue of approximately 25 billion RMB [5]. - The report anticipates an increase in profit margins due to the removal of certain Android applications, allowing for lower user acquisition costs through alternative channels [4]. - The target price has been adjusted from 471 HKD to 473 HKD, reflecting a 26% upside potential based on revised profit forecasts [15]. Financial Projections - Revenue is projected to grow from 554.55 billion RMB in 2022 to 787.65 billion RMB by 2026, with a compound annual growth rate (CAGR) of approximately 9.4% [24]. - Non-IFRS net profit is expected to rise from 115.65 billion RMB in 2022 to 258.91 billion RMB in 2026, indicating a significant growth trajectory [24]. - The report highlights a projected increase in earnings per share (EPS) from 12.1 RMB in 2022 to 27.7 RMB in 2026 [24]. Market Position and Strategy - The company is focusing on enhancing its video platform and AI capabilities, with expectations for video advertising and e-commerce to drive future revenue growth [6]. - The strategic adjustments in the WeChat video platform are expected to improve monetization opportunities [6]. Competitive Landscape - The report notes that the gaming sector, particularly with titles like "Peacekeeper Elite" and "Honor of Kings," continues to show strong performance, validating the long-term operational strategies [5]. - The company is also exploring new game releases in the latter half of the year, which could further bolster its market position [5].