Tencent selloff an ‘enhanced buying opportunity,’ says Citi

Citi reiterates a Buy rating and “top-pick status” on Tencent (TCEHY) following news reported by several media outlets, including Reuters, that the company is included in the latest Department of Defense Section 1260H list that was supposed to be formally published on January 7. A Bloomberg article referencing a comment from Tencent’s representative noted that “the presence on the list was ‘clearly a mistake’… We will nonetheless work with the Department of Defense to address any misunderstanding,” noted the analyst, who highlights Hesai Technology and IDG Capital as two notable companies that were previously included in the 1260H list and later successfully removed. The firm, which believes Tencent’s overall growth outlook and business fundamentals remain intact and views the selloff as an “enhanced buying opportunity,” has a HK$573 price target on the shares.