Since April 2022, Chinese regulators have started approving video games again after a months-long freeze, easing Beijing’s crackdown on gaming.
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Shares of Chinese gaming companies rose on Wednesday after regulators approved a slew of new games, a sign that some headwinds could be easing for the sector.
The list published on Tuesday by China’s National Press and Publications Administration did not include approval for the games from the giants. Tencent And net ease,
Tencent’s shares were flat in Hong Kong trading, but the continuation of the game’s approval, which resumed in April after a one-month freeze, has lifted other companies.
NetEase’s Hong Kong-listed shares were up nearly 3% in afternoon trading, while streaming giant bilibili was up more than 4%. The latest installment had two games of Bilibili approved.
shares of kingsoftAnother publisher, Hong Kong, was more into business as well.
Meanwhile, a subsidiary of TikTok owner ByteDance had also approved a game. Beijing Headquarters ByteDance is playing aggressively in the online gaming arena Through acquisitions that have helped it increase player spending.
In China, games need to be approved by regulators in order to be released and monetized.
Beijing has come under intense scrutiny from technology companies targeting gaming over the past year and a half. Last year, China introduced rules that limited play time A maximum of three hours per week for online games for children under 18. Regulators subsequently withheld approval of the new games for several months.
This has had a major impact on companies that rely heavily on gaming. China’s biggest gaming company Tencent reports its slowest revenue growth on record in the first quarter of this year.
But three rounds of gaming approvals since April suggest that the action could be easing.
“We believe the two consecutive months of approval should allay market concerns about industry trends,” Jefferies equity analyst Thomas Chong said in a note on Tuesday.
Chong said Tencent, NetEase and Bilibili are among the companies that “are going to benefit from greater visibility on gaming approvals.”
Daniel Ahmed, senior analyst at Nico Partners, said the return of approvals to one batch per month is a “positive sign for the industry”, but noted that these are only for home games.
“Based on historical precedent, we expect to see the first batch of approved import titles in the near future,” referring to games developed by foreign publishers.