Investors seeking exposure to China's growing mobile gaming industry should look at technology giants Tencent and NetEase , according to Goldman Sachs. The investment bank expects "China to see faster growth from mid 2024 supported by game launches and a loosening regulatory environment." Goldman's optimism on Tencent and NetEase despite expectations that both companies will have a slow first quarter "given lack of new game contributions and a high base last year.
The median price target of 58 analysts polled by FactSet points to a 21% upside for the stock. Among the analysts, 56 having a buy or overweight rating, one has a hold rating and one has a sell rating. NetEase NetEase posted a 16% year-on-year rise in domestic sales growth and 1% rise in international sales growth last month, Goldman's analysts noted. They are now expecting shares in the tech giant to rise by around nearly 40% to $129 in the next 12 months.