|Bid||N/A x N/A|
|Ask||N/A x N/A|
|Day's range||237.82 - 241.89|
|52-week range||189.53 - 319.32|
|Beta (5Y monthly)||0.82|
|PE ratio (TTM)||26.90|
|Earnings date||20 May 2021 - 24 May 2021|
|Forward dividend & yield||N/A (N/A)|
|1y target est||315.16|
(Bloomberg) -- Tencent Holdings Ltd. founder Pony Ma pledged $7.7 billion toward curing societal ills and lifting China’s countryside out of poverty, echoing Xi Jinping’s priorities at a time Beijing is tightening its grip on internet giants.The billionaire chief executive officer on Monday pledged to set aside 50 billion yuan for a “sustainable social values” program, in what would be one of China’s largest corporate charity initiatives. Tencent promised to tackle a plethora of issues from renewable energy and scientific education to health care and rural revitalization -- a centerpiece of Xi’s over-arching policy framework. The gaming and social media giant intends to fold its existing foundation and philanthropic activity into a new unit to oversee the initiative, which also encompasses carbon neutrality, the provision of food, water and energy, and general public welfare.The program coincides with a period of intensified scrutiny over the growing power and influence of China’s largest corporations from Tencent to Alibaba Group Holding Ltd., which received a $2.8 billion fine for allegedly abusing its market dominance. Regulators are now said to be eyeing Tencent, China’s largest publisher of games and content for a billion-plus people on WeChat. Last week, the Shenzhen-based company pledged to comply with antitrust laws and eradicate monopolistic practices.“Tencent should continue to respond to the ever-changing needs of the public and of the era, so as to develop and prosper together with society as a whole,” Ma said in a memo to employees published online.Tencent’s ear-marked budget could rank among the world’s largest corporate philanthropic endeavors -- total U.S. charitable giving from individuals, non-profits and corporations surpassed $449 billion in 2019, according to the Giving USA foundation. The Chinese company has only just completed one of the year’s biggest Asian dollar-bond deals and had about $23 billion of cash and equivalents at the end of December.Corporations around the world have in recent years stepped up philanthropy and so-called ESG or environmental, social and governance efforts, in part because investors are paying more attention to this area. China itself has launched campaigns to clean up the environment, worried about the toll pollution could take on the economy as well as its people. Ahead of an annual meeting of top officials this year, Ma led research into low-carbon industries and submitted a proposal to lawmakers regarding carbon neutrality for tech companies.Read more: Jack Ma’s Double-Whammy Marks End of China Tech’s Golden AgeFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- After a historic antitrust crackdown on China’s biggest tech companies last week, investors are betting there is more pain ahead.GAM Investments, BNP Paribas Asset Management and JP Morgan Asset Management Inc. see more regulatory tightening in China’s clampdown on monopolistic practices, putting pressure on the country’s leading internet stocks over the next few months. The Hang Seng Tech Index, where many Chinese tech giants are listed, has already lost about a quarter of its value from a rout that began mid-February.The shockwaves from Beijing’s bid to quell abuses of information and market dominance among industry leaders have left global investors pondering the prospects of China’s internet firms. The antitrust crackdown has exacerbated a global tech selloff sparked by rising bond yields, as traders forecast tighter liquidity conditions at home and abroad and lower company valuations.“Regulations for China internet companies, especially the big ones, will continue to tighten in 2021,” said Marcella Chow, global market strategist at JP Morgan Asset. “This uncertainty may act as a cap for some companies temporarily.”China slapped a record $2.8 billion fine on Alibaba Group Holding Ltd. after a four-month long investigation into the e-commerce giant’s market practices, then ordered an overhaul of Ant Group Co. Over the past week, more than 30 tech giants issued pledges to obey antitrust laws after Beijing gave them a month to conduct reviews and comply with government guidelines.READ: Jack Ma’s Double-Whammy Marks the End of China Tech’s Golden AgeAlibaba shares have slumped 23% in Hong Kong from a peak in October. Food delivery platform Meituan and tech giant Tencent Holdings Ltd., which have been on analyst radars for regulatory probes, are down 36% and 18%, respectively, from their peaks earlier this year. By contrast, the Nasdaq 100 index is up more than 8% this year despite entering a technical correction in March.Looking ahead, China’s tech companies are likely to move far more cautiously on acquisitions, over-compensate on getting signoffs from Beijing, and levy lower fees on the domestic internet traffic they dominate. This coincides with some facing delisting threats and sales curbs in the U.S., and others reverberating from a selloff sparked by Archegos Capital Management.Valuations too are serving as a deterrent for investors. Even after its decline, the Hang Seng Tech Index is trading at about 38 times its 12-month earnings estimates versus the 29 times multiple of its American counterpart.“We have already applied a valuations discount to the whole Chinese internet sector to factor in higher regulation risks,” said Jian Shi Cortesi, a Zurich-based fund manager at GAM. The $132 billion asset manager has reduced its exposure to the sector in the past few months amid high valuations, she added.The Hang Seng Tech Index was down as much as 1.1% on Monday. Tencent shares fell as much as 1.9% after Citigroup Inc. and Morgan Stanley lowered their target prices on expectations that advertising revenues will take a hit as apparel-brand and online-education providers cut spending.Keep the FaithThat said, Beijing has moved far faster with its antitrust reforms than the U.S. and Europe have in similar efforts. The landmark case against Microsoft Corp.’s alleged software monopoly took more than half a decade of back-and-forth before settling in 2004. Current hearings involving U.S. tech titans from Google to Facebook Inc. span several fronts, multiple cases and plaintiffs, and may not see the inside of a courtroom for years to come.In contrast, Beijing regulators torpedoed Ant’s IPO the month after Ma’s infamous speech, published new rules shortly after intended to curb monopolistic practices across its internet landscape, then launched its probe into Alibaba on Christmas Eve.“Clarity reduces uncertainty, so this is a positive,” said Joshua Crabb, a portfolio manager at Robeco in Hong Kong.That has helped give investors more optimism for the long term. Money managers see the potential for tech companies to boost earnings as digital technologies catch on for everything from e-commerce and entertainment to social media, a trend that has been accelerated by the pandemic.Meanwhile, mainland traders have kept the faith. They still hold about 6.5% stake in Tencent, the highest in at least three years, according to calculations by Bloomberg based on exchange data.“Post this round of regulation scrutiny, we believe the Chinese internet industry will resume healthy growth,” GAM’s Cortesi said.(Updates with performance of Hang Seng Tech Index, Tencent in tenth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Ant Group denied a report that the Chinese finance-technology company is exploring ways for founder Jack Ma to sell his stake and give up control as a means to ease pressure from the country’s regulators.Reuters reported earlier that officials from the People’s Bank of China and the China Banking and Insurance Regulatory Commission held talks with Ma and Ant separately between January and March, where the possibility of Ma’s exit was discussed. The report cited people familiar with the matter.The company hoped that Ma’s stake would be sold to existing shareholders in Ant or its e-commerce partner Alibaba Group Holding Ltd., Reuters said.Ant issued a statement to the news agency that said the divestment of Ma’s stake wasn’t considered. The company reiterated the denial in a tweet following the report, saying the “divestment of Mr. Ma’s stake in Ant Group has never been the subject of discussions with anyone.”The Chinese’ government has been squeezing Ma’s internet empire as part of an effort to imprint its authority indelibly on the country’s technology industry. In landmark announcements this month, it slapped a record $2.8 billion fine on Alibaba for abusing its market dominance, then ordered an overhaul of Ant.Read more: Jack Ma’s Double-Whammy Marks End of China Tech’s Golden Age Ant will effectively be supervised more like a bank, a move with far-reaching implications for its growth and ability to press ahead with a landmark initial public offering that the government abruptly delayed late last year.The overhaul outlined by regulators and the company will see Ant transform itself into a financial holding company, with authorities directing the firm to open its payments app to competitors, increase oversight of how that business fuels it crucial consumer lending operations, and ramp up data protections. It will also need to cut the outstanding value of its money-market fund Yu’ebao.Bloomberg Intelligence senior analyst Francis Chan said in a report earlier this week he expects Ant’s valuation to drop below 700 billion yuan ($107 billion) from 2.1 trillion yuan in an earlier attempt to go public.“Ant Group’s prospects could wane further after China halts improper linking of Alipay payments with Ant’s other products,” he said. “New curbs on Yu’ebao also hurts its wealth business.”Ant’s Prospects Wane on Alipay’s Decoupling From Products: ReactFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.