Equity Valuation & Analysis Report - Tencent Holdings Limited

Threat from New Entrants There are currently no new threats from new entrants in this market. Company G’s technology, testing and production process that is very efficient for profitability cannot be easily replicated.

Based on some considerations above, the bargaining power of buyers on automotive industry is moderate.

The bargaining power of suppliers is low because of the presence of powerful buyers who are able to direct terms to the suppliers who are generally small firms. Besides these suppliers of tires, parts, electronic, mechanical equipment are small players and may have only one or two clients (ancillaries).

In this case, we do not think there are any other industries that could meet the unique product demand of this industry. This means that the threat to substitutes is very low.

Bargaining power of buyers is medium-high because of the low switching costs and wider spectrum of similar products selling at competitive prices due to the influence of developing countries

Due to the fact of price sensitivity is high, consumers are willing to consume identical product with lower price; they stand on a strong bargaining position. On the contrary, suppliers have relative strong bargaining power because the high concentration of the industry.

Research Analysts Kulbinder Garcha 212 325 4795 kulbinder.garcha@credit-suisse.com Deepak Sitaraman, CFA 212 325 5808 deepak.sitaraman@credit-suisse.com Achal Sultania 44 20 7883 6884 achal.sultania@credit-suisse.com Alban Gashi 212 538 3033 alban.gashi@credit-suisse.com Talal Khan 212 325 8603 talal.khan@credit-suisse.com Matthew Cabral 212 538 6260 matthew.cabral@credit-suisse.com Vlad Rom 212 325 5442 vlad.rom@credit-suisse.com

This company experienced an all-time high in March of 2011 when its close price hit an astounding 93.01 but then dropped by nearly 20 three months later when it closed at 76.95 and then 55.44 in September of that same year. They currently hold a return on equity of 9.61% and a return on assets of 5.24%. The industry that this company is in, oil and gas industry, has seen enormous advances in technology and this has helped toward assisting companies in producing more oil and gas. These technology advancements have allowed them to more accurately find and produce resources in order to maximize profit for the companies. Although the technology efficiency is on the rise, trying to maintain a fresh and talented workforce within the industry is an area that is struggling. Another factor hurting this industry is the decrease in activity and transactions, which took a huge plummet in 2013 compared to 2012. Despite these setbacks, the oil and gas business still maintains to be dynamic due to how critical the resources are to the daily lives of everyone in the world.

Alibaba’s sites have currently reached over 65 millions of registered users, hosted over millions of merchants and businesses globally. In 2005, its revenue had reached over approximately US$100 millions. Although China’s gross domestic product

We note that the company’s previous stock repurchases and its plans to continue with the said program effectively signals to the market that the management feels that its stock is underpriced and that it has a positive outlook on the stock’s future performance. Adding to this the company’s relatively low leverage position and a strong A+ rating, which is the highest in the

On the 9th of July 2010 the company was trading at $17.40 now three years later is trading at $126.09. That is a positive gain of 556.72% or $106.89 in three years.

With Intel have very few substitutes in the microprocessor industry, it is it is most certain that current customers will not want to switch and use another company’s products. High switching cost presents low bargaining power to the customers mainly because it would be very expensive to switch to a competitor, and since Intel is the leader in the market, switching

Bargaining power of suppliers. Suppliers have the ability to leverage, control, and negotiate the cost of their products (Hill et al., 2015, p. 56). In the case of the suppliers of the office supplies industry, more so for Staples, the bargaining power is weak and is considered to be low. The reason for its power being weak is a result of large companies having several suppliers that will easily compete against each other to provide the lowest cost of products.

The Alibaba group has thrived in the Chinese e-commerce sector from its inception in 1998. They currently account for over 70% of online shopping in China and delivered annual revenues of $636 million in the 12month period ending June 2009 (case p1-2). Alibaba’s successes are due to multiple factors that have allowed them to create corporate advantage, and thus establish market leadership in China (Case p1). The configuration and coordination of Alibaba’s

Threat of substitutes: A substitute to the services of the industry would be that the customer organization employ & train the in house staff to come up with such services. The company may rely on the existing staff but market players provide advantage by releasing the core employees from doing non-administrative processes. In all there is a weak threat of substitutes in the industry (Datamonitor,2011).