author: by the wind, the data support: Pythagorean big data, from the title figure: Vision China
The listing of Ants is very hot, and a lot of funds flow into Ant’s new shares. A-shares issued five strategic allotment funds as early as September, while Hong Kong stocks froze 20 billion of new funds a day yesterday, and the oversubscription rate has reached 6 times. In order to ease the liquidity tension, the Hong Kong Monetary Authority has released 33 billion Hong Kong dollars of liquidity in the past 4 days.
On the other hand, at the same time that Ant went public, Tencent’s share price in the secondary market hit record highs. The market first chose to buy Tencent.
The reason is simple. Previously, the market had not been clear about the value of Tencent’s financial technology business, nor had it realized the commercialization potential of Tencent’s financial technology business. However, the disclosure in the Ant’s prospectus gave Tencent Financial a comparable target. The revaluation of Tencent’s financial technology business is directly reflected in the increase in Tencent’s stock price-breaking the 600 mark.
So many investors joked that Tencent, which was originally a rival, has become “the strongest ant stock.”
How will the value of Tencent be revalued when Ant is listed?
First of all, the simplest and most direct valuation method for Tencent Finance is to use Ant’s PE.
Tencent’s quarterly performance will disclose the revenue and profit of the financial technology sector. By benchmarking this part of profit with Ant’s P/E ratio, you can roughly get the valuation of Tencent’s financial business.
In the 2020 mid-year report, Tencent’s “financial technology and corporate services” business revenue in the second quarter was 29.8 billion yuan, a year-on-year increase of 30%. Revenue in the first half of the year was 56.3 billion yuan, a year-on-year increase of 26%. According to public information, after deducting costs, Tencent’s “financial and corporate services” business gross profit was 16 billion yuan in the first half of the year, with a gross profit margin of 28%. Due to the financial reportNo net profit is disclosed, so you might as well use this data as an estimate of net profit.
According to Ant’s prospectus, from January to June this year, Ant’s revenue was 72.5 billion yuan, net profit was 21.234 billion yuan, and the profit margin was 29%. The market value of Ant’s prospectus is (2.1 trillion RMB). Assuming that there is no increase in revenue and profit in the second half of the year, then Ant Group’s P/E ratio is (PE) is 50 times.
If the same PE is used to value Tencent’s financial business, then the market value of Tencent Finance should be 1.6 trillion. This means that, compared with (i.e. October 23) before Ant’s disclosure of the IPO price, Tencent has about 400 billion share price to free up space.
In terms of stock price performance, from the closing price of (October 23) last Thursday at HK$561.5 to HK$601 yesterday, Tencent The cumulative stock price has risen by 6.65%, and the market value has increased by approximately HK$380 billion, indicating that the market is already reflecting the increase in this part of the valuation.
However, it is not difficult to predict that if Ant’s stock price rises after the transaction, the boost to Tencent’s stock price will continue.
A rough estimate of Tencent’s share price boost through Ant PE is the most direct and the first to be reflected in the market. In fact, the long-term impact of Ant’s listing on the valuation of Tencent’s financial business should be re-examined from the perspective of business barriers and space.
The business models of Tencent Finance and Ant both originated from payment.
In my opinion, the two obvious advantages of Tencent Finance have not been fully developed, that is, the room for Tencent Finance’s mid-term growth. First, WeChat has huge traffic and potential high value-added financial users who have not yet been fully converted. Digital payment is the traffic portal of digital finance, and the ant prospectus also emphasizes that it plays a vital role in expanding online and offline users. The aforementioned data has also shown that, compared to Ant, WeChat Pay relies on the strong social attributes of WeChat to bring a stronger number of monthly active users and a higher number of daily payments. As of June 2020, WeChat’s MAU is 1.206 billion, Alipay’s MAU is 711 million, WeChat is 1.7 times that of Alipay in the same period, and the number of user activations should be higher than Alipay. Tencent Finance’s user reach capabilities are stronger than Alipay. As mentioned earlier, according to the official risk management announcement of Tenpay and Alipay in 2019, it can be estimated that the total number of WeChat payment transactions in 2019 is about 550 billion, with an average of 1.5 billion transactions per day, and the total number of Alipay transactions. The number is about 230 billion, an average of 630 million per day. However, Tencent Finance has a big gap with Ants in transforming payment users into high-value-added financial service users in order to release the real liquidity capabilities of financial services. Take wealth management as an example. The current number of users of Licaitong is about 200 million, accounting for only 1/6 of the number of WeChat users. The scale of assets under management is about 1 trillion, while Ant’s asset management scale is 4 times that of Licaitong. . In particular, there is also the credit business. Ant Huabei and Bibai have become the core support of Ant’s profits, but Tencent Finance has not seen any obvious strength. However, the good thing for Tencent is that these businesses are different from payment businesses whose market share has stabilized. They are still in the early stages of development, and the demand is huge enough, and there is a lot of room for late development. According to data from Oliver Wyman Consulting, in 2019, small and micro business loans are about 8 trillion yuan, and it is expected to reach 26 trillion yuan by 2025, exceeding the scale of personal consumer credit. In terms of users and funds, Internet wealth management business also has growth prospects. According to CNNIC data, the number of domestic Internet wealth management users is only 160 million, accounting for only 18% of all Internet users. Oliver Wyman Consulting data shows that domestic personal investable assets In the rapid growth stage, the scale of this data in 2019 is aboutAnt’s competitive advantage is mainly reflected in its core e-commerce system, which has established the basic market of Alipay, and then extended digital financial services such as credit and wealth management on the basis of transactions.
However, for Tencent, compared with its own mini program ecology, what needs to be resolved is the relationship with the invested company and how to establish a mutually beneficial cooperation mechanism.
In short, at this stage, Tencent’s advantage lies in the scale of traffic and users and payment services, while Ant’s advantage is commercialization. The listing of Ants made the market find that it underestimated the commercialization potential of Tencent Finance, making Tencent the “strongest ant stock.” But in the end, Tencent’s financial business will truly open up room for growth as the internal traffic of Tencent’s system is transformed into financial customers.