China Merchants International raised the target price of Tencent Holdings to 660 Hong Kong dollars, expecting AI to sustain business growth.

China Merchants International released a report stating that Tencent Holdings' first-quarter performance exceeded expectations, with revenue increasing by 13% year-on-year, and Non-IFRS net profit increasing by 22%, both exceeding market expectations by 3%. During the period, the gaming and advertising business revenues grew strongly, with year-on-year growth rates of 24% and 20% respectively, and gross profit margin expansion also exceeded expectations, attributed to the shift in revenue structure and cost efficiency improvements. Based on the first-quarter performance, the bank raised Tencent's Non-IFRS net profit forecast for 2025 to 2027 by 3% to 7%, raised the target price from HK$625 to HK$660, and believes that the development of AI will continue to drive growth in different business segments, maintaining a "buy" rating.