Morgan Stanley reiterates "overweight" rating on TENCENT (00700) with a target price of HK$450.

Morgan Stanley released a research report stating that it is expected that TENCENT (00700) will achieve a domestic total revenue of 5 billion RMB for the first time. This could be another milestone for Tencent's globalization, reaffirming its "overweight" rating and "top pick", and maintaining a target price of 450 Hong Kong dollars. Morgan Stanley predicts that Tencent's first annual domestic total revenue will be 5 billion RMB, assuming the following: 1) an average of about 5 million DAUs (daily active users) converted from pre-registrations; 2) an ARPU (average revenue per user) of about 80 RMB per month. Morgan Stanley believes that launching both mobile games and PC games simultaneously can bring additional synergies in game operation and user retention. Morgan Stanley believes that "Delta Force" could be another milestone for Tencent's globalization. Considering Tencent's long-standing dominance in the FPS (first-person shooter) market in China, the bank believes that "Delta Force", especially the PC version's global release, can further expand its global market share.