0244 GMT - Tencent could generate a high return from its AI investments, with sustainable ad growth, incremental enterprise demand and consumer-facing application monetization, Morgan Stanley analysts say in a research note. MS estimates Tencent's 2025 capital expenditure at 94 billion yuan, mainly on graphics-processing-unit procurement. "With continuous AI ad tech upgrades, we believe Tencent's ads growth should be more durable than global peers given leverage from user data in mini programs and payments," the analysts say. Despite growing capex, MS thinks management remains confident about margin expansion from a favorable business-mix shift. MS maintains its overweight rating and top-pick designation for Tencent and raises the target price to HK$630.00 from HK$550.00. Shares are last at HK$513.00. (sherry.qin@wsj.com)
(END) Dow Jones Newswires
March 20, 2025 22:44 ET (02:44 GMT)
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