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<Research>JPM: NetEase to Launch 3 Highly-anticipated Games in Jul; Reiterated as Top Pick in Online Game Sector
Recommend 5 Positive 8 Negative 4 |
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JPMorgan highlighted in a research report that NTES-S (09999.HK) (NTES.US) will launch 3 heavyweight games next month. Once Human, an open-world survival game, will be launched on 10 July, while Naraka: Bladepoint mobile version and Where Winds Meet PC version will be launched on 25 July and 26 July, both of which are highly anticipated by the market. It is expected that the multitude of newly launched games will accelerate the company's game revenue growth in 2H and bring room for a revaluation of the share price. JPM believed NetEase's current valuation of 13x 2024 P/E represented a good market entry point. The broker also points out that the impact of adjustments to the trading system of Fantasy Westward Journey PC version has stabilised recently, which is believed to help ease investors' concerns about the revenue performance of its existing games. The broker reiterated NetEase as its top pick in the mainland online game sector, with an Overweight rating and a target price of HK$200 for H-shares and US$130 for US shares. According to JPM's current forecast, the grossing of Naraka: Bladepoint mobile will reach RMB10 billion in the first 12 months after its launch, compared with street estimates of RMB5 billion to RMB6 billion. As for Where Winds Meet PC version, the broker conservatively expected grossing for the first 12 months to reach about RMB3 billion to RMB4 billion. AAStocks Financial News |
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