Citigroup: Maintains "Buy" rating on TENCENT (00700) and raises target price to HKD 648

Citigroup released a research report stating that it maintains a "Buy" rating for TENCENT (00700), with a target price raised from 563 Hong Kong dollars to 648 Hong Kong dollars, and will observe it for positive catalysts for 90 days. The bank believes that DeepSeek's accelerated adoption of the strengthened WeChat ecosystem and CSIG (Tencent Cloud and Industrial Business Group) indicates optimistic prospects for the company's capital expenditure, and WeChat may transform into a mainland super AI application. Citigroup pointed out that with Tencent's large language model "Element" climbing from 12th on the productivity download list on February 1st to 2nd on February 23rd, surpassing ByteDance's "Douyin" and only behind DeepSeek. In addition, Tencent recently reorganized several key applications, including "Element," into the CSIG business group, indicating that Tencent has strengthened its strategic priorities to fully embrace the accelerating adoption of artificial intelligence by Chinese businesses and individual users.