Tencent still frozen out as China okays latest games

HONG KONG • Tencent Holdings Ltd and Netease Inc were again left out when regulators green-lit the latest batch of online games, spurring concern that China’s largest gaming companies may have to wait longer than anticipated to start making money off hit titles.

Neither company appeared on a list of 93 domestic games approved for licences in January and were also absent from 164 cleared in December, ending a nine-month freeze.

Smaller rivals, including Shanghai-listed Jiangsu Phoenix Publishing & Media Corp and Shenzhen-listed Sanqi Interactive Entertainment, made the cut instead, according to notices posted by the State Administration of Press, Publication, Radio, Film and Television.

Tencent’s pipeline has been on ice since March, when regulators halted the release of new titles in the world’s largest gaming market. That crippled the Chinese gaming giant’s ability to make money from its biggest hits — PlayerUnknown’s Battlegrounds and Fortnite.

The company shed more than US$200 billion (RM826 billion) in market value at one point in 2018, leading losses in Chinese gaming shares. Yesterday, Tencent’s stock slid as much as 2.4%.

“It was quite surprising Tencent wasn’t included. People thought Tencent might have had a chance this time,” said Sean Lee, a Taipei-based fund manager at Shin Kong Investment Trust Co.

He added that he might sell some shares in Tencent, one of his largest portfolio holdings as of December’s end. — Bloomberg