According to a report published by J.P. Morgan Chase, regarding the recent adjustment of monetization models for some large-scale multiplayer online role-playing games, such as “Journey to the West,” it was concluded during discussions with NetEase management that there will be little impact in the short term. This strategic change should support the long-term healthy growth of these games.

The bank believes that the mainland's game regulatory environment is still healthy, as evidenced by the large supply of new game versions. Motong believes that NetEase's stock price performance has outperformed the market since the beginning of the year, mainly because investors are concerned about the monetization of traditional games and the prospects for new games. NetEase's current stock price is equivalent to 13 times the price-earnings ratio of 2024. It is at the lowest level in the past five years, and lower than its peers in Asian online games. The bank expects that new games launched by NetEase starting in the third season will accelerate game growth, and valuations will also be raised from current levels.

The bank maintains$NTES-S (09999.HK)$“Overweight” rating, with a target price of HK$200 for Hong Kong stocks, once again the first choice for the mainland online game industry.