Despite Regulatory Interference, Gaming Sector Continues Gaining in Stock Prices

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According to the latest reports, the stock prices for the major gaming companies have continued to experience a rally. The share prices for the companies on Wednesday, September 1, 2021, experienced a notable rise.

The gaming sector has continued demonstrating a rise in stock prices, despite the interference from the Chinese regulators. Just recently, the Chinese regulators imposed stricter restrictions on the gaming time of children in China.

The gaming time of children below the age limit of 18 was to play games for a lot less time than they did in the past. Therefore, it was expected by some analysts that the gaming giants in China would eventually feel the impact on their stock prices.

However, the majority of the analysts predicted that although the gaming giants would experience a dip in stock prices, they will soon recover and demonstrate a surge in their stock prices.

This is exactly what the Chinese gaming giants have experienced and their stock prices are now experiencing a surge. The data shows that the companies started experiencing a surge in their stock prices on Wednesday, September 1, 2021.

Initially, the Chinese regulators had children below the age of 18 play video games for 90-minutes per day. However, the regulators have changed the rule and imposed a harsher one that only grants children 3 hours for gaming per week.

The reason behind the rise in the share prices for the gaming giants is the investors not losing any confidence in them. Despite the recent implementations, the investors have continued investing in major gaming giants in China.

When it comes to gaming giants being listed on the Hong Kong Stock Exchange, there are two companies Bilibili and NetEase. On Wednesday’s trading, Bilibili has demonstrated a 6.25% rise in its share prices, while NetEase has experienced a 6.42% rise in share prices.

In the meanwhile, Chinese gaming giants listed on the US Stock Exchange include Tencent and Huya. On the Wednesday trading, the stock prices for Tencent have risen by 1.5%, while stock prices for Huya have experienced a 7% rise.

It was predicted by the majority of the analysts that although the regulators imposing stricter regulations would not impact the performance of gaming giants in China. So far, the industry does not seem to have been impacted by it and it is growing at an organic rate.

Upon the recent actions taken by the Chinese regulators, the gaming giants have also spoken up about the matter. NetEase revealed that it is hardly going to experience any drop in stock prices as only 1% of its revenue comes from children under the age of 18.

However, Tencent may feel the impact at a higher rate because the analysts have revealed that 5% of Tencent’s revenue is generated through gaming from children under 18.