Amidst a myriad of complex messages, Tencent has significantly ramped up its share buyback efforts!
On the evening of January 10th, Tencent revealed that it had repurchased 4.01 million shares at prices ranging from HKD 370.2 to HKD 379.2 per share, resulting in a total expenditure of HKD 1.5 billion on that day.
Noteworthy to financial analysts is that after the U.SDepartment of Defense placed Tencent among its "1260H list," which designates companies involved with China's military, Tencent's daily buyback amount increased dramaticallyFrom January 7th to January 10th, the company executed buybacks of HKD 1.5 billion each day, effectively doubling from the prior week’s daily buyback rate of HKD 700 million.
Interestingly, on January 8th, the Office of the United States Trade Representative (USTR) released its "2024 Notorious Markets" list, and for the first time, WeChat was removed from itPreviously, Tencent's WeChat had been included in the list in both 2022 and 2023.
As of January 10th, Tencent's shares closed at HKD 369.6, giving the company a total market valuation of HKD 3.41 trillion.
Considering whether Tencent remains a worthy investment, renowned investor Duan Yongping shared with his followers on the Xueqiu platform that he has purchased Tencent shares alongside investment in Kweichow Moutai.
Resurgence of Major Buybacks
On January 10th, Tencent announced it had repurchased 4.01 million shares amounting to HKD 1.501 billion.
According to the buyback authorization resolution, the total number of shares Tencent can repurchase stands at 942 million, of which 251 million shares have already been repurchased.
In terms of buyback amounts and totals, between January 7th and 10th, Tencent's average daily buyback amount reached HKD 1.5 billion, showing a doubling compared to single-day buyback amounts observed in December 2024 and early January 2025.
Data indicate that on January 2nd, 3rd, and 6th, Tencent repurchased 1.68 million, 1.69 million, and 1.71 million shares respectively, with each day’s buyback amount fixed at HKD 701 million.
On January 6th, the U.S. disclosed that it included Tencent, along with Ningde Times and other companies, in the "1260H list," marking the first time Tencent had been designated in this manner.
On the morning of January 7th, Tencent responded, stating, “Tencent being on this list is evidently an error; we are neither a military enterprise nor a military supplier
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Unlike export controls or other measures, this listing does not impact our businessNevertheless, we will work with relevant U.S. authorities to clarify this misunderstanding.”
Although the listing had no operational impact, it shook the stock market considerablyTencent's closing price on January 6th stood at HKD 409.4 per share, but dropped to HKD 379.6 on January 7th, reflecting a decrease of 7.28%.
In an effort to bolster market confidence, on January 7th, Tencent invested HKD 1.5 billion to repurchase 3.93 million shares, which represented an increase of 114% compared to the HKD 701 million it spent on January 6th.
Following January 7th, Tencent executed similar buybacks on January 8th, 9th, and 10th, with each day's repurchase amount consistently reaching HKD 1.5 billionAs of January 10th, the total buyback amount had reached HKD 81.06 billion.
It’s also crucial to note that Tencent disclosed it executed 129 buyback transactions over the course of 2024, repurchasing 307 million shares for a total expenditure of HKD 112 billion, averaging HKD 868 million spent daily.
In parallel with its massive buyback strategy, Tencent has also curtailed selling by its major shareholder, ProsusData reveals that from June 2022, when Prosus began selling Tencent shares, until December 27, 2024, Tencent’s total buyback amount had reached HKD 187.6 billion, surpassing the HKD 174.5 billion in shares sold by Prosus during the same period.
Duan Yongping's Increased Stake in Tencent
While Tencent is repurchasing shares, it is also liquidating investments in two other companies.
On January 9th, it was revealed through Hong Kong Stock Exchange documents that Tencent's stake in Weimob decreased from 8.39% to 2.94%, and its holding in UBTECH went from 8.05% to 2.08%.
In response to recent sell-offs of Weimob and UBTECH, Tencent told reporters: "We actively review our investment portfolio and assess potential adjustments, which can allow us to allocate funds for shareholder returns or new investment opportunities."
Despite the effects of being listed on the U.S
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Department of Defense's 1260H list, on January 8th, Tencent received positive news from the U.S. with the removal of WeChat from the "Notorious Markets" list.
The U.S. aims to expose online and physical market entities reportedly contributing to large-scale piracy and trademark counterfeiting via the infamous market report.
WeChat had been listed in 2022 and 2023 but made its first exit this yearTencent strongly opposed its inclusion, asserting its commitment to being a global leader in torchbearers for a robust intellectual property system, as well as emphasizing its significant investments in and collaborative efforts for global IP protection.
Related to the recent classification of Tencent in the U.SDepartment of Defense’s “Restricted Procurement List” (CMC list), there appears to be a discrepancy in U.S. government agency actionsUnlike the CMC, which only limits procured transactions with the Department of Defense and its suppliers, the "Notorious Market List" is issued by the President's office, bearing a broader focus on tradeAnalysts suggest that this could be seen as good news for Tencent, indicating a lack of unified action among U.S. government agencies concerning the company.
Additionally, on January 9th, notable investor Duan Yongping indicated on his Xueqiu account, stating: "Today I bought Tencent and also invested in Kweichow Moutai."
Duan Yongping, a well-known entrepreneur, previously founded brands like "Little Tyrant" and "BBK," which also served as the background for OPPO and VIVOSubsequently, Duan gained considerable fame in investment circles through substantial investments in Apple, Kweichow Moutai, and Tencent, holding these investments till this day.
On January 5th, Duan returned to his alma mater, Zhejiang University, where he interacted with students and faculty, discussing companies such as Tencent and Kweichow Moutai.
“If you just happen to find good companies you like, I think it’s a great option to get in, as I see that even during less favorable economic conditions, good companies are still doing alright
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