Equity Valuation & Analysis Report - Tencent Holdings Limited

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Equity Valuation & Analysis Report ACCT6111E Business Valuation & Analysis Instructor: Professor Albert Tsang Team members Name Student ID Winnie Yam 1155025593 Sherry Zhang 1155023131 Fiona Tong 1093644801 Tommy Wu 1155021510 Robert Pun 1155026071 21 November 2013 TABLE OF CONTENTS 1.0 Executive summary [3] 2.0 Industry overview [4] 3.0 Company overview [6] 4.0 Financial statement analysis [12] 5.0 Profitability analysis [23] 6.0 Company valuation [27] 7.0 Concerns beyond financials [32] 8.0 Recommendations [35] Bibliography [36] List of Exhibits [37] List of Appendix [48]…show more content…
Participants may also take the advantage of weak enforcement of intellectual property protection, e-commerce and anti-trust laws and regulations to expand their businesses apart from their successful business strategies, which resulted in the emergency of giants like Baidu (online search engine), Tencent (instant messenger) and Alibaba (e-commerce platform). As a result, the threat of new entrant is moderate at the moment because of the user lock-in effect and dominant market position enjoyed by existing giants, which constitutes high entry barrier for potential entrants. The threat of substitutes in the industry is rather low at the moment due to the user lock-in effect and dominant market position enjoyed by existing giants, resulting in a higher switching cost and hence a relatively lower bargaining power of buyers. The bargaining power of suppliers, on the other hand, could be considered moderate for the time being due to their good reliance on vendors to provide develop and maintain high-quality online business interfaces. From the above discussion, the competition within the industry is rather moderate at the moment and the industry/ market is still growing that

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