King's glory takes all 7 QDII funds at home and abroad to "attack" two online game giants

In May this year, Tencent launched the "King's Glory to Europe and America Edition" in the overseas App Store and Google Play Store, and made certain game adaptations for the Western market. The original traditional heroes in China were replaced with Western superheroes, such as Batman, Van Helsing, etc. Statistics show that the download volume of "King's Glory European and American Edition" has exceeded 1 million times.

When "King's Glory" was being attacked in China, there was "good news" that it quickly occupied overseas markets. According to the latest reports, in May this year, Tencent launched the "King's Glory to Europe and America Edition" on the overseas App Store and Google Play Store, and made certain game adaptations for overseas markets. The original traditional heroes in China were replaced with Western superheroes, and the current download volume has exceeded 1 million times.

As the two major game giants in China, Tencent and Netease account for more than two-thirds of the game market. According to Tencent's quarterly report, revenue from smart mobile games accounts for 26% of Tencent's overall operating income. Pei Pei, an analyst at Guojin Securities, believes that there is still much room for growth in mobile games in the existing market, and the fulcrum is competition. As technical conditions mature and R & D investment increases, competitive high-quality mobile games continue to be born. The e-sports of mobile games will provide a new fulcrum for the continued growth of mobile games in the existing market.

Netizens '"Pesticide" Heavy Position Fund "Glory" Recently, a series of problems caused by minors' obsession with "King's Glory" have pushed this national mobile game to the forefront."King's Glory" has been nicknamed "King's Pesticide", netizens call playing this game "into the pit".

As a mobile game,"King's Glory" is undoubtedly a success. Data shows that as of May 2017, the number of King's Glory users exceeded 200 million, and the number of daily active users in May reached 54.128 million.

According to the latest reports, in May this year, Tencent launched the "Glory of the King in Europe and America" on the overseas App Store and Google Play Store, and made certain game adaptations for the Western market. The original traditional heroes in China were replaced with Western superheroes, such as Batman, Van Helsing, etc. Statistics show that the download volume of "King's Glory European and American Edition" has exceeded 1 million times.

According to Tencent's first quarterly report, in the first quarter of 2017, Tencent's revenue was 49.6 billion yuan, a year-on-year increase of 55%, mainly driven by smartphone and personal computer games, payment-related services, digital content and online advertising. In terms of smart mobile games, Tencent's revenue reached 12.9 billion yuan, a year-on-year increase of 57%, accounting for 26% of Tencent's overall operating revenue, mainly driven by "King's Glory" and two other games.

As of the end of the second quarter, Tencent Holdings has increased by 47.52% this year, and QDII funds that hold heavy positions in the stock have also achieved good returns. According to statistics, at the end of the first quarter of this year, Tencent was heavily held by 43 QDII funds and 23 Hong Kong Stock Connect funds. Among them, the one holding the largest number of Tencent is Harvest Overseas China Equity Fund, holding 2.9747 million shares. The one holding the highest ratio of Tencent's market value to the fund's net value is E Fund's China Securities Overseas Internet ETF Fund, holding a market value of 20.4% of its net asset value.

Among the 66 QDII funds and Hong Kong Stock Connect funds that hold heavy positions in Tencent, 7 have earnings exceeding 20% from the beginning of this year to the end of the second quarter, 52 have earnings exceeding 10%, and only 2 have negative earnings. Ranked at the top of the list is the Bank of Communications China Securities Overseas China Internet Fund, with an increase of 28.59%. Its number one heavy position is Tencent Holdings, among which Momo's holdings doubled in the first half of this year. Among the fund's top ten heavy positions, only Vipshop will fall.

In addition, the reporter noticed that the fund companies that hold the largest shares in Tencent are Harvest Fund and China Asset Management Fund, and the number of holdings is close. Harvest's three funds hold a total of 4.9656 million shares in Tencent, and China's five funds hold a total of 4.9313 million shares in Tencent. Ranked third is Qianhai Kaiyuan, whose five funds hold a total of 3.4463 million shares of Tencent.

Competitive transformation into the growth fulcrum of mobile mobile games. On July 4, affected by the glory of two batches of kings at People's Daily Online, Tencent's Hong Kong stock price plunged sharply in the intraday session, closing down 4.13% that day, and its market value evaporated by more than 100 billion Hong Kong dollars in a single day.

On the same day,"King's Glory" announced the launch and trial operation of a new health game anti-addiction system. It will adopt strict measures for underage users by limiting the daily login time for minors, upgrading the growth guard platform, and strengthening the real-name authentication system. Protection measures. This measure has aroused concerns among some market participants. They believe that as mobile games have recently been criticized by the society and have passed the explosion period, and the conflict of interest between Tencent Holdings and other platform companies intensifies, Tencent may become the next target of short sellers and hedge funds.

However, investment banks are still optimistic about Tencent. Morgan Stanley said that according to statistics, only 3.5% of players under the age of 14 account for "King's Glory", and 22.2% are players aged 15 to 19. The ARPU and payment ratio of young players in the game is also relatively low. Limiting game time has a slight impact on Tencent, maintaining its target price of HK$310.

UBS estimates that "King's Glory"'s quarterly revenue this year will be 6 billion yuan, which is expected to contribute 11% to Tencent's overall revenue this year. Assuming that the net profit margin of the game is between 30% and 35%, it is expected to contribute to Tencent's overall profit this year by 12% to 14%. UBS believes that child players pay less than mainstream players.

The rapid improvement of the performance of mobile phones and the development of 4G networks in recent years have provided a very good environment for the competition of mobile games, making it possible to break out of mobile competitive products. Survey shows that in the second half of 2016, mobile game sales accounted for 49.5% of game market revenue, but in the first half of 2013 and before, mobile game sales accounted for only single digits. In the first half of 2008, mobile games accounted for only 2.7% of market sales revenue.

Compared with mobile games, the proportion of sales revenue of client games is decreasing year by year. In the first half of 2008, sales revenue of client games accounted for 94.5% of the total game market revenue. The latest data for the second half of 2016 shows that sales revenue of client games accounted for only 35.2% of the sales revenue of the entire game market. Pei Pei, an analyst at Guojin Securities, believes that since 2016, with the disappearance of the mobile Internet traffic dividend, mobile games have changed from an incremental market to a stock market. There is still much room for growth in mobile games in the existing market, and the fulcrum is competition. As technical conditions mature and R & D investment increases, competitive high-quality mobile games continue to be born. The e-sports of mobile games will provide a new fulcrum for the continued growth of mobile games in the existing market.

As the two major game giants in China, Tencent and Netease account for more than two-thirds of the game market. According to the "2016 Game Industry Annual Conference" report, Tencent accounted for 46.6% of the mobile game publishing market share, and Netease accounted for 21.86%. According to the first quarterly report, Netease's net income was 13.641 billion yuan, a year-on-year increase of 72.3%. Among them, net income from online game services was 10.735 billion yuan, a year-on-year increase of 78.5%, accounting for 78.7% of the total net income. Among them, net income from mobile games accounted for 73.3% of net income from online game services, compared with 64.4% and 63.7% respectively in the previous quarter and the same period last year. According to statistics from reporters, among the QDII funds, 7 hold heavy positions in both Netease and Tencent, with profits of more than 15%.

Editor: Mary