Research reports from Daiwa indicate that the newly added gifting feature in WeChat can help boost short-term demand, benefiting categories such as Cosmetics, toys, snacks, and health supplements. The firm believes that this new feature may have a significant impact on certain consumer brands during the upcoming Lunar New Year holiday, as it creates new consumption scenarios for young consumers, with POP MART (09992.HK), Proya Cosmetics (603605.SH), and Three Squirrels (300783.SZ) expected to benefit.

The firm notes that the total transaction value of products in WeChat stores remains relatively small, but with the product upgrades and increased traffic allocation anticipated in mid-2024, this area seems to have become a key focus for Tencent (00700.HK) to monetize through its WeChat platform. (vc/u)

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