Tencent, which is by far Naspers’s most valuable investment, could grow its earnings 35% a year over the next three years, a Shanghai-based portfolio manager says. This should continue to support the investment case for the Chinese internet giant. Some analysts have become sceptical about Tencent’s ability to maintain its blistering growth rate, partly because the rate of smartphone penetration and usage growth could start to slow down in China. The bullish earnings projection for Tencent excludes contributions from its fledgling mobile payments business and search engine functions, which are yet to turn profitable, said Xiaogang Zhang, MD and co-portfolio manager at Greenwoods Asset Management. But Zhang said Tencent’s growth prospects were partly based on the opportunity to lift advertising income. Tencent generates about a fifth of its revenues from advertising. For instance, Tencent could generate far higher advertising revenues from its social media platforms, as well as its vi...

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