In "Major Banks," China International Capital Corporation (CICC) states that NetEase's first-quarter performance exceeded expectations, raising the target price for Hong Kong stocks to HKD 220

Bank of China International published a research report indicating that NetEase-S (09999.HK) (NTES.US) saw a 15% year-on-year growth in core game revenue in the first quarter of this year, surpassing the firm's expectation by 2%. Among these, PC game revenue grew by 85% year-on-year, in line with the firm's forecast, while mobile game revenue declined by 4% year-on-year, still exceeding the firm's expectation by 3%. Adjusted net profit increased by 32% year-on-year to RMB 11.2 billion, far exceeding market and the firm's expectations, mainly benefiting from excellent gross margin performance and strict management of sales and marketing expenses. Cash revenue grew by 17% year-on-year and 30% quarter-on-quarter.

The firm believes the company is benefiting from various streamlining adjustments, including optimizing existing projects and investments in new projects, operations, and channels. Therefore, it has raised its full-year adjusted profit forecast by 14%, expecting a year-on-year increase of 21% to RMB 40.5 billion; maintaining a "Buy" rating, with the target price for Hong Kong stocks raised from HKD 195 to HKD 220, and the target price for U.S. stocks raised from USD 124 to USD 140