Morgan Stanley: Reiterates "overweight" rating on TENCENT (00700) with a target price of 570 Hong Kong dollars.

Morgan Stanley released a research report stating that it reiterated its "overweight" rating on TENCENT (00700), continuing to list it as a preferred stock with a target price of 570 Hong Kong dollars. TENCENT's WeChat public e-commerce platform, WeChat Xiaodian, introduced a "send gift" feature in a grayscale test, allowing users to purchase goods below 10,000 RMB for gifting and directly send them to WeChat friends. The gift-giving feature is similar to the format of WeChat red envelopes and is believed to be in line with the development strategy of WeChat Xiaodian, which aims to build a unified and trustworthy e-commerce platform for users within the WeChat ecosystem, providing indexed and standardized goods. Morgan Stanley expects that after the new feature is fully launched, it will attract more merchants to join WeChat Xiaodian, ultimately creating opportunities for growth in e-commerce-related transactions and advertising revenue. On the other hand, considering the fierce market competition, Morgan Stanley believes that Tencent's increasing focus on developing Xiaodian business may cause concerns for competitors in the e-commerce industry.