In "Major Banks," China International Capital Corporation: Tencent's main business maintains high-quality growth

CICC published a research report, optimistic about Tencent (00700.HK) maintaining high-quality growth in its main businesses of gaming, advertising, finance, and enterprise services, as well as accelerating its layout in the AI field. It is expected that this year's gaming revenue growth will be supported, and advertising revenue growth is likely to outperform market performance, with ecosystem products such as video accounts and mini-programs deeply collaborating to drive growth. AI technology will enhance operational efficiency, and user loyalty is expected to increase. Currently, it is predicted that the revenue from fintech and enterprise services in the fourth quarter of last year could grow by 10% year-on-year.

In response to increased investment in the AI field, which may raise the ratio of R&D expenses, CICC expects Tencent's adjusted operating profit in the fourth quarter of last year to increase by 23% year-on-year, and adjusted net profit is expected to grow by 23% year-on-year. The revenue forecast for 2025 remains largely unchanged, but considering the volatility of fintech revenue, this year's revenue forecast has been revised down by 1% to RMB 831.7 billion, while the Non-IFRS profit forecasts for 2025 and 2026 have been raised by 1% to RMB 262.9 billion and RMB 294.8 billion, respectively.

CICC currently forecasts Tencent's revenue and Non-IFRS profit for 2027 to be RMB 903.5 billion and RMB 326.9 billion, respectively, maintaining an "outperform industry" rating and a target price of RMB 700