NTES(NTES) 网易·2024-06-30 03:40Investment Rating - The report maintains a Buy rating on NetEase Inc. (NTES/9999.HK) with a 12-month target price of US196 [7][38]. Core Insights - Improving fundamentals are noted, particularly with the confirmed release date of Naraka Bladepoint Mobile on July 25, 2024, and positive feedback from the second round of testing [2][38]. - The report highlights that the competition risk from Tencent's Honour of Fight is likely milder than expected, suggesting potential coexistence of both games within the same genre [3]. - The potential revamp of the publishing team for Where Wind Meet PC is mentioned, indicating a strategic move in response to market conditions [6][13]. Summary by Sections Game Launch and Market Response - Naraka Bladepoint Mobile's launch announcement led to a 6% increase in NetEase's share price on June 26, 2024, aligning with market expectations [2]. - Positive feedback from the second round of testing for Naraka Bladepoint Mobile indicates improved performance optimization [2][12]. Competitive Landscape - The report assesses Tencent's Honour of Fight, suggesting that its earlier stage of development may allow for coexistence with Naraka Bladepoint, despite both being in the action royale genre [3]. - The report notes that 88 out of 170+ FWJ PC servers are experiencing currency depreciation week-over-week, while some servers show early signs of improvement [3][13]. Valuation and Financial Metrics - The report indicates a total return potential of 34.4% based on the current share price of US$93.04 [17][39]. - Financial metrics include a projected revenue increase from Rmb 103,468.2 million in 2023 to Rmb 132,829.2 million by 2026, alongside an EBITDA growth from Rmb 33,966.2 million to Rmb 44,162.1 million in the same period [40].