WeChat boom pushes Tencent shares to record high, boosting Hang Seng index
App’s monthly active users grew to 938 million in first quarter, up 23pc from last year
Chinese online major Tencent Holdings hit a new all-time high on Monday thanks to robust growth in revenues from its popular messaging app WeChat, or Weixin as it is known in mainland China.
The rally in Tencent shares pushed Hong Kong stocks higher, with the Hang Seng Index finishing up 0.9 per cent to 25, 391.34.
Tencent shares briefly jumped by as much as 3.1 per cent to HK$276.8 (US$35.46) intra-day before paring back gains and finishing up 2.6 per cent at HK$275.4. Tencent’s market capitalisation reached HK$2.61 trillion at one point.
Several investment banks recently raised their target price for Tencent shares, after the company reported last week a 58 per cent year-on-year increase in net profit in local currency terms for the first quarter, beating market estimates.
Revenues grew 55 per cent year-on-year to 49.6 billion yuan, thanks to strong growth in the online games and advertising businesses.
In particular, advertising on WeChat helped drive revenue growth, as the app’s monthly active users (MAUs) grew to 938 million in the first quarter, up 23 per cent from the same period last year.