CICC International: raise Tencent Music target price to HK$93.8, expected second-quarter revenue to grow by 12% year-on-year.

Bank of China International has released a research report stating that it is expected that Tencent Music's second quarter revenue will increase by 12% year-on-year, with the music business growing by 19%, which is in line with expectations. The gross profit margin is expected to be 44.8% and the adjusted net profit margin is 28.9%, both slightly higher than expected. The bank also predicts an increase of 1.5 million music paying users for the quarter, with average revenue per paying user at 11.7 yuan, a 2% increase from the previous quarter. The bank believes that Tencent Music will further enrich its profit channels and deepen the commercial extraction of segmented users through more refined operations to enhance user engagement. The bank maintains a "buy" rating on the company and further raises the H share target price from 73.8 Hong Kong dollars to 93.8 Hong Kong dollars, while the US share target price is raised from 18.8 US dollars to 23.9 US dollars.