Games' version number is renewed. Tencent was once again concerned by the market.

Since the afternoon of April 11, the news of the resumption of the game version number has spread widely in the game circle, and when the website of the State Press and publication Administration (hereinafter referred to as the copyright Administration) is updated, the "game version number" once jumped to the second place on Weibo Corp's hot search list.

The reason why it is so hotly debated is that, on the one hand, the domestic game version number has been re-issued after 263 days (since July 22, 2021), which is long-awaited good news for game manufacturers, investors and players alike.

On the other hand, although the game industry has survived a suspension of version numbers in 2018, at a time when the market economy is declining and the environment is suddenly changing, the new version of the number is even more precious to game makers-which may also mean that the spell that has bound the game industry for eight months has been loosened.

To this end, some analysts believe that, "as long as the version number policy is normalized and predictable, game stocks may usher in the inflection point of medium-and long-term configuration, and more importantly, capital will refocus on the game industry is conducive to plate valuation repair." so continue to be optimistic about the market performance of the next game stocks. "

What is worth paying attention is that, in this context, the trend of the game stock price represented by Tencent has once again become the focus of the market.

Galaxy Securities said, "with the resumption of version number approval, the valuation of the game plate and the performance of game companies will be repaired." We focus on recommending head game companies with R & D strength and strong certainty of going out to sea. "

Game version number restart, for the head of the company's head products, its research and development completion is relatively high, if the subsequent version number can be obtained, the performance will bring substantial growth.

Advertising business may become an engine of growth

For the forecast of Tencent's stock price trend, in addition to looking at policy warming factors, its performance growth momentum and core business growth are also indicators of concern in the industry.

On the evening of March 23rd, Tencent disclosed his 2021 results. The company's annual operating income was 560.1 billion yuan, up 16% from the same period last year; the net profit belonging to shareholders of listed companies was 224.8 billion yuan, up 41% from the same period last year; and the net profit adjusted by non-international standards was 123.8 billion yuan, up 1% from the same period last year.

Tencent's business can be divided into two major parts, one is the main business, including value-added services, online advertising, financial technology and corporate services and others, and the other is investment business.

At present, the more consistent voice in the industry is that Tencent's advertising business will become its growth engine.

CITIC said that although the company's short-term performance is under pressure, the core business still maintains a strong competitive advantage.

The company continues to invest in key areas such as international games, video numbers, cloud and enterprise software, and is expected to become more competitive. Wechat video account is expected to start information flow advertising by the end of 2022. According to the situation of moments ads and Kuaishou Technology ads, video ads are expected to contribute about 37 billion yuan in incremental revenue in 2023, and the income elasticity is expected. The company will also continue to improve efficiency and optimize costs, and is expected to show a more robust profit structure and achieve sustainable growth in the future. "

Frequent buybacks send positive signals to the market

At the same time, Tencent has recently made frequent buybacks, sending a signal that the enterprise's value is undervalued to the capital market, proving his confidence in the future business prospects.

Tencent recently issued an announcement on the Hong Kong Stock Exchange, spending more than HK $300m to buy back 804000 shares at a repurchase price of HK $363.6-HK $377.8 per share.

In addition, Tencent announced on the evening of the 12th that the company bought back 821000 shares that day, at a cost of about HK $300 million. This is the 12 consecutive trading days for Tencent to buy back a total of 9.67 million shares, at a total cost of about HK $3.6023 billion.

Since the beginning of this year, Tencent has bought back a total of 14.5014 million shares, spending a total of about 5.798 billion Hong Kong dollars, far exceeding the repurchase scale of about 2.6 billion Hong Kong dollars for the whole of last year.

Analysts said that Tencent has recently continuously repurchased more than 3.9 billion Hong Kong dollars, and the current fluctuation range of stock prices in the secondary market is relatively stable. The company's frequent buybacks show management's confidence in the company's future operation. If the short-term price remains in the current range, the company may still have buyback actions.

It is understood that Tencent has carried out several rounds of stock buybacks since he went public, and Tencent has sold buybacks 50 times since 2021.

Zheng Zhigang, a professor of finance at Renmin University of China, believes that at a time when the entire capital market is in the doldrums, the share prices of Chinese Internet listed companies are undervalued and share buybacks are used to boost investor confidence and send a positive signal to overseas markets.

Organization: Tencent still has room for upside in the medium to long term.

So, under the policy warming, advertising business as an engine of growth, and management buyback confidence, how do institutions see it?

Let's take a look at the latest views of a number of securities firms:

CITIC:With the introduction of Internet-related regulatory policies one after another, the future industry policy guidance is expected to become clear. Tencent began to buy back continuously from March 25, demonstrating his confidence in the steady growth of core business in the future. We believe that the current stock price of the company has entered the value investment range and there is still room for continuous upside in the medium and long term. Maintain a "buy" rating.

Founder Securities:We believe that Tencent is currently at the "bottom of the fundamentals", the game business Q1 has signs of reversal, pay attention to the follow-up progress of the new game launch; the re-release of the game version number is expected to accelerate the recovery of the advertising business in the second half of the year.

Zhongtai Securities:We expect that Tencent's short-term performance will still be affected by the macro environment and regulatory changes, but the company pays attention to long-term sustainable development and has a positive attitude towards regulation, the competitiveness of games in the international market is increasing, Wechat ecosystem is improving and the video number is gradually exploring and realizing, SaaS has not yet pursued realization, strategic changes will lead to the improvement of corporate service profit margins, and it is expected that as the marginal impact of policy decreases, there is still more room for growth in the long run.

Structured products, know something about it?

To sum up, in the view of a number of institutions, Tencent will hold a concussive upward trend in the future.

At the same time, under the background of the impact of the epidemic and the risk of tightening the financial environment brought about by the Fed's interest rate hike, as well as the continuing conflict between Russia and Ukraine, adding more uncertainty to the investment environment, the need to invest in sunrise industry leaders has greatly increased. Tencent may be a good choice.

However, for investors who want to reduce the difficulty of investment and get a more robust return in the shock trend, you can take a look at structured products.

Structured products are customized according to the different needs of investors and linked to different underlying assets and options, which can improve the potential rate of return of investors in a variety of market environments.

To put it simply, as long as investors judge the investment direction roughly correctly, structured products can give them a bottom line for pullback and room for returns in a volatile trend.