Daily Investment Strategy
Daily focus：Tencent Music（1698）
Tencent Music (1698) announced its Q1 2025 earnings, demonstrating steady and high-quality growth. Total revenue reached RMB 7.36 billion, an 8.7% YoY increase, in line with market expectations. Additionally, non-IFRS net profit was RMB 2.12 billion, up 24.6% YoY, slightly exceeding the market forecast of RMB 2.06 billion. The strong performance was mainly driven by robust growth in online music services revenue, driven by the number of paying users rose to 122.9 million, an 8.3% increase YoY. Moreover, the average monthly revenue per paying user increased from RMB 10.6 to RMB 11.4, reflecting improved user willingness to pay and spending power.
U.S. inflation data hits lowest level since February 2021
The U.S. released April inflation data, with the Consumer Price Index (CPI) rising 0.2% month-on-month, below the expected 0.3% and rebounding from the previous -0.1%. Year-on-year, the CPI increased by 2.3%, the lowest since February 2021 and below the market consensus of 2.4%. Core inflation (excluding food and energy) also rose 0.2% month-on-month, below the 0.3% forecast, while the year-on-year figure remained unchanged at 2.8%. Despite the better-than-expected inflation data, market concerns about future price increases due to tariff impacts persisted, leading to a volatile reaction in U.S. Treasury yields, which initially fell before rising again.
On Tuesday, the Stock Connect program recorded a net inflow of HK$2.26 billion. Among the stocks, China Construction Bank (939) saw the highest net inflow at HK$579 million, followed by Alibaba (9988). On the other hand, Tencent Holdings (700) experienced the largest net outflow at HK$664 million, followed by SMIC (981).
Cheung Cho Shing, Joseph is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to:https://apps.sfc.hk/publicregWeb/indi/ACQ030/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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