UBS released a report on Chinese fintech stocks. Despite short-term pressure from trade conflicts, it expected fintech businesses of Chinese internet platform to manifest robust CAGR of 8% for gross profit and 9% for net profit from 2024 to 2029. This is propelled by potential policy stimulus and stabilized regulations following tighter oversight. The broker assumed that the market to have undervalued the major contribution of fintech businesses to the profit growth of internet platforms.

Consequently, the broker raised its valuation for fintech businesses, leading to upward revisions in 2025 EPS forecasts and target prices for TENCENT (00700.HK)  -9.000 (-1.739%)    Short selling $519.46M; Ratio 8.048%   and Alibaba (BABA.US)      , both rated Buy. TENCENT’s target price was lifted from HKD676 to HKD700, and Alibaba’s from USD176 to USD180. UBS also reaffirmed Buy ratings for Qifu Technology (QFIN.US)      and YUSYS TECHNOLOGIES (300674.SZ)  -0.440 (-1.851%)   .

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In UBS view, mainland China’s fintech sector will have a greater impact on profits and valuations, recommending investors buy TENCENT, Alibaba, Qifu Technology, and YUSYS TECHNOLOGIES.
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