Hong Kong stocks once again pulled back sharply, and Tencent became the "fuse".
On April 11, local time, Tencent’s major shareholder Prosus announced that it plans to repurchase again. As part of the repurchase plan, Prosus will take action this week to transfer 96 million shares of Tencent shares to Hong Kong Central Clearing and Clearing System in the form of certificates, so that Under the repurchase program, such shares are traded in an orderly manner over a period of time. If calculated based on the latest stock price, the market value of the above-mentioned stocks is about 30 billion yuan.
According to market analysis, the above-mentioned behavior of Prosus may mean that it will continue to reduce its holdings of Tencent stocks. Today, Tencent continued to fall after opening low. As of the latest, Tencent’s share price was 354.6 Hong Kong dollars per share, a drop of 5.84%. Affected by this, the Hong Kong stock market fell across the board. Hang Seng Technology opened slightly lower in the morning and then fell sharply. By 3:30 in the afternoon, Hang Seng Technology fell by more than 2.4%, and the Hang Seng Index fell by more than 1%.
It is reported that Naspers Group is a multinational listed media giant. In 2001, MIH, a subsidiary of Naspers holding company Prosus, bought a 46.5% stake in Tencent and became its major shareholder. In order to raise funds to repurchase its own shares to save the stock price, Naspers announced in June last year that it would launch a long-term, open-ended repurchase program. The repurchase funds will be obtained through the orderly and small sale of Tencent shares. In September and December of last year, Nasper announced that it would reduce its shareholding in Tencent, and the shareholding continued to decline. Subsequently, it suspended the reduction for a period of time under the sluggish stock price of Tencent.
According to the latest data, Prosus holds 26.93% of Tencent through its subsidiary MIH, and is still the largest shareholder of Tencent.
Tencent's major shareholder Prosus will reduce its holdings again?
After Tencent's performance and stock price stabilized for a period of time, it faced the pressure of shareholders to reduce their holdings.
On April 11, local time, Tencent’s major shareholder Prosus announced on its official website that it would update the open-ended repurchase plan for Prosus and Naspers shareholders of free float shares announced on June 27, 2022 (collectively referred to as the “repurchase plan”), involving the share capital of Prosus and Naspers. N shares of common stock.
Prosus said that as part of the continued implementation of the repurchase plan, Prosus will take measures to deposit another 96 million Tencent shares it holds in the Hong Kong Central Clearing and Clearing System in a certified form this week, so that they can be repurchased according to the repurchase plan. Plan to carry out market transactions of such shares in an orderly manner over a period of time.
In fact, on April 3 and April 6, Prosus has now repurchased 1,783,398 Prosus shares at an average price of approximately EUR 71.14 per share, for a total consideration of EUR 127 million.
Statistics show that Naspers is a multinational listed media group located in South Africa. It is the largest shareholder of Tencent through its holding Prosus subsidiary MIH TC Holdings Limited ("MIH"). Tencent's annual report shows that Prosus holds 26.93% of Tencent through its subsidiary MIH. , the largest shareholder of Tencent.
However, it is not surprising that Prosus reduced its holdings in Tencent. On June 27 last year, Prosus and Naspers, major shareholders of Tencent, announced that they would launch a long-term, open-ended repurchase plan. The repurchase funds will be obtained through the orderly and small sale of Tencent shares by the South African newspaper group.
Data shows that on September 8 and December 16, 2022, Naspers implemented the shareholding reduction plan twice, reducing its holdings by 1.115 million shares and 993,000 shares respectively, and cashed out HK$339 million and HK$318 million respectively. In one year, Naspers' share of Tencent fell from approximately 28.82% on December 31, 2021 to 26.93%.
It is worth mentioning that after June last year, Tencent’s stock price fell from more than 360 Hong Kong dollars under the epidemic environment and the pressure of shareholders to reduce their holdings. It hit a new low of 188.63 Hong Kong dollars per share on October 25, 2022. Tencent's share price subsequently reversed in a "V" shape, and rose to about HK$300 per share on December 16, when Naspers reduced its holdings. Naspers then remained unchanged, and Tencent's stock price continued to rise to a high of HK$416.6 per share on January 27, 2023.
Tencent itself also launched a share repurchase program
Faced with the pressure of large shareholders to reduce their holdings, Tencent itself has not only achieved good results, but also carried out its own share price repurchase plan.
On March 22 this year, Tencent released its financial report for the fourth quarter and the full year of 2022. Among them, the net profit in the fourth quarter of 2022 was 29.711 billion yuan (Non-IFRS), a year-on-year increase of 19%. It returned to double-digit growth for the first time since the third quarter of 2019.
Tencent will achieve revenue of 554.55 billion yuan in 2022, a year-on-year decrease of 1%, and a net profit (Non-IFRS) of 115.649 billion yuan, a year-on-year decrease of 7%. Among them, Tencent performed brilliantly in the TO B business. The annual financial technology and enterprise service segment revenue was 177 billion yuan, accounting for 32%, surpassing games, and the revenue ratio hit a new high.
It is worth noting that last year, under the shock of the stock price, Tencent took the action of repurchasing stocks every month, and the repurchase amount also hit a record high.
According to the data, Tencent repurchased 107 million shares on the Hong Kong Stock Exchange for a total value of approximately HK$33.8 billion in 2022. The minimum repurchase price reached HK$246.2 per share and the highest reached HK$477.4 per share. In 2021, the total amount of Tencent's repurchase on the Hong Kong Stock Exchange is only HK$2.6 billion, and the repurchase of 5.58 million shares means that the repurchase amount in 2022 is about 13 times that of 2021.
Tencent stated that the repurchased shares have been cancelled, and the purpose of the repurchase is to increase shareholder value in the long run.
Entering 2023, Tencent's own repurchase plan will continue to be implemented.
On April 11, Tencent announced that it repurchased 930,000 shares at a cost of 353 million Hong Kong dollars. The repurchase price ranged from 371.6 Hong Kong dollars per share to 389.2 Hong Kong dollars per share. According to statistics, Tencent has repurchased a total of 107 million shares this year. .