HK Stock Market Move | CHINA RUYI (00136) once fell more than 13%, Tencent is the second largest shareholder, institutions are optimistic about the company's three major businesses advancing together

CHINA RUYI (00136) fell more than 13% at one point, dropping 10.4% as of press time to HKD 2.24, with a turnover of HKD 3.04 billion. On the news front, market concerns were raised by Tencent's announcement of reducing its holdings in two companies at the beginning of the year, leading to a decline in Tencent-related stocks today. Analysts at Zhongtai International believe that Tencent's move may be to focus on its main business. They believe that by 2025, Tencent may continue to increase its investment in technological innovation to accelerate the application of AI large models. "Tencent's other businesses, such as advertising, gaming, and finance, are all consumer-related. As Tencent continues to invest in strategic emerging industries, its company valuation will gradually increase." According to China Ruyi's 2024 interim report, Tencent indirectly holds 20.36% of the company as the second largest shareholder through its wholly-owned subsidiary Water Lily Investment Limited. Huachuang Securities previously pointed out in a research report that the company is backed by Tencent, joined hands with Wanda, and actively integrates industry resources. Currently, the company has three main businesses: film and television production (Ruyi Films), streaming media (Pumpkin Films), and gaming (Jingxiu Games). The bank points out that under pressure from the supply cycle in 2024, growth in 2025 is expected due to the low base. It is optimistic about the company's future development with the simultaneous progress of its three main businesses and the significant synergy effects with Wanda.