Goldman Sachs released a research report stating that the Non-GAAP Net income forecast for NTES-S (09999) for last year remains at 31.72 billion yuan; revenue and forecasts for this year and next year have been raised by 0.4% and 0.5% respectively, with Non-GAAP Net income forecasts raised by 0.7% and 0.5% to 35.065 billion and 38.164 billion yuan respectively. The Target Price has been adjusted from 169 HKD to 181 HKD, deeming the risk-reward ratio attractive, rating "Buy".
The report states that the third-person hero shooter game "Marvel's Avengers," developed and published by NetEase in collaboration with Marvel, has performed strongly since the zero season launched last December. It is predicted that the launch of the new season will further drive player sentiment, and the season pass and new character equipment introduced will also help improve monetization levels. It is estimated that this game could generate annual revenue exceeding $0.4 billion this year, with monthly active users estimated to reach 2.0 million, and the first twelve-month ARPU forecast has been raised to $20.
In addition, the bank has correspondingly raised its forecast for NetEase's PC game business revenue growth this year to 26%, expecting overall game revenue to grow by 9%. It pointed out that since mid-last year, NetEase has strengthened its game development and publishing in the Global market, and it has already achieved initial results. Coupled with the renewed collaboration with Blizzard, it is believed that this can drive NetEase's PC and console game revenue growth by 30% to 40% for the fourth quarter of last year and throughout this year.
