G Sachs: Investors Concern about TENCENT's Game Biz Re-acceleration, BABA E-Commerce, Cloud Biz Growth, Shareholder Return Guidance

The share prices in Chinese Internet sector surged by a total of 15% YTD, Goldman Sachs released a research report saying. With $TENCENT(00700.HK)$ and $BABA-SW(09988.HK)$ set to release results tonight, Goldman Sachs focused on a number of key figures from the results of the two companies mentioned above.

Goldman Sachs believed that the market's focus on the company's 1Q24 net profit, forward-looking comments around 2Q24's top line growth, and any updates to shareholder return policies will be closely watched as the next key share price drivers.

While Goldman Sachs expected only mid-single-digit YoY group revenue growth for 1Q24 at both companies, for TENCENT, the broker believed that the double-digit growth in the company's games from March to April could provide clarity on the growth pace of the games business in 2Q24, according to the report.

Goldman Sachs believed that the BABA management's counterattack strategy for the e-commerce sector continues to gain traction, and that the sales growth rate of Taobao-Tmall will outpace the national sales growth rate in the recent months.