Latest Search
Quote
| Back Zoom + Zoom - | ||||
|
<Research>CICC Views AI’s Impact on CN Internet Grows, Recommends Tencent as Top Pick, Highlights Kuaishou & NetEase
Recommend 23 Positive 40 Negative 12 |
||||
|
||||
|
A recent analysis by CICC highlighted AI’s transformative role in China’s internet sector, with impacts across five key areas: 1) Model: Chinese internet firms have neared global advanced standards in AI model capabilities, leveraging a mix of proprietary research and open-source solutions to optimize iterative strategies; 2) ToC (To Customer) Applications: AI Agents are emerging as a pivotal growth area. Companies like ByteDance and Tencent are building intelligent agent ecosystems, driving rapid growth in conversational bot user bases; 3) ToB (To Business) Services: AI is empowering productivity tools and cloud computing. Products like Meitu Design Studio and KUAISHOU-W (01024.HK)’s Kling AI have achieved commercial success, while the integration of AI with cloud services is boosting revenue; 4) AI Empowering Existing Businesses: AI is empowering advertising and gaming. Tencent, Kuaishou and BIDU-SW (09888.HK) have adopted AI to improve ad targeting precision, while AI in gaming evidently boosts development efficiency and user experience; 5) Capex Investment: Chinese internet companies are ramping up AI investments, with substantial capex focused on inference-side computing power. This shift from training to inference positions AI as a critical driver of long-term commercial growth. CICC’s 2025 outlook, balancing valuation, fundamentals and AI potential, recommended key players: Tencent, a top pick given its robust gaming business, sustained organic growth in advertising via WeChat Channels, and payment business returning to positive in October. Potential upside includes macro recovery and partnerships with firms like BABA-W (09988.HK). Tencent’s valuation remains undemanding, backed by strong shareholder return commitment. Its WeChat ecosystem provides a competitive edge in AI applications, particularly in AI search and Agents; Kuaishou, which offers high profit growth certainty for 2025, with overseas operations turning profitable and domestic business growth paired with improved margins. Its low valuation, stabilizing e-commerce market, and emerging revenue streams like short-form drama exports are expected to drive profits. Kling AI, a global leader in video generation, boasts mature use cases and a commercial model, poised for strong growth; NTES-S (09999.HK), a long-term focus, currently at a historically low valuation. CICC highlighted NetEase’s sustained innovation in gaming content, with its future performance worth monitoring. AAStocks Financial News |
||||
Copied to Clipboard
 |
||||
