Coronavirus Deep Dive: Impact on Chinese Internet
- February 12, 2020
Oppenheimer analysts discuss the potential impact of the novel Coronavirus (nCov) by examining the economic impact of the 2003 SARS virus. The conclusion is that nCOV should have a negative impact on the overall Chinese economy, especially transportation, lodging, catering, and offline retail, potentially slowing China's GDP growth by 100-200 basis points in the first quarter of 2020.
The outbreak could potentially benefit some Internet sectors including online games, online video, online music, social media, live streaming, and public cloud, as people spend more time online. Given these impacts, we see Tencent Holdings and Tencent Music Entertainment as more resilient near term, and we are more cautious on Alibaba, Baidu and Trip.com near term.
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