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<Research>Daiwa: Top Picks for CN Internet Are TENCENT & TRIP.COM; NTES, PDD, MEITUAN & BEKE Favored
Daiwa said in a research report that it has recently met with a number of investors in the US, and found that many of them who focus on investing in Asian markets now have similar investment weightings in China, while global and international funds still take a relatively cautious view of investing in China.

The broker found that US investors are generally bullish on TENCENT (00700.HK), with most giving it a Buy or an Overweight rating, and are looking for more catalysts to push the stock further outperforming the broader market, such as improved performance in the gaming business, strong growth in advertising and sustained shareholder returns.

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The broker added that investors are also bullish on PDD (PDD.US), which is consensusly rated Buy, while also favouring TRIP.COM-S (09961.HK) (TCOM.US), BEKE-W (02423.HK) (BEKE.US) and MEITUAN-W (03690.HK). Daiwa commented that TRIP.COM's international business development, which the broker expected to provide the company with long-term sustainable growth momentum, does not seem to be well understood by investors. NTES-S (09999.HK) (NTES.US), which the broker is bullish on, is less popular than the other stocks.

Daiwa's top picks are TENCENT and TRIP.COM, followed by NTES, PDD, MEITUAN and BEKE, all of which are rated Buy.

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