0347 GMT - Tencent is poised to maintain its dominance in China's gaming market, Morningstar analyst Ivan Su says in a note. Its valued-added services revenue could rise at 7% CAGR over the next five years, mostly supported by the game segment, Su says. China's gaming market is more closely tied to the release of blockbuster titles than consumption trends, thus there could be ample room for innovation and growth, Su says. Tencent owns or co-develops seven of the world's top 20 highest-grossing game franchises, which will continue to generate substantial and growing revenue, Su says. The game segment's gross margin could further improve as Tencent leverages its own distribution channels such as WeChat to bypass app-store fees, he adds. Shares are last 1.2% lower at HK$425.60. (sherry.qin@wsj.com)
(END) Dow Jones Newswires
October 20, 2024 23:47 ET (03:47 GMT)
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