Xi replaces Deng’s cat, bad news for Tencent – With insights from The Wall Street Journal

The JSE's most important company isn't even listed on the South African market. But given that Chinese internet giant Tencent determines the share prices of the exchange's heaviest weighted stocks – Naspers and Prosus – what happens to Pony Ma's business is critical for SA investors. And although the latest quarterlies released this morning are OK (see below) the longer term outlook is positively frightening. After decades of super-charged economic growth, China's Communist Party is changing course. Out goes Deng Xioping's famous approach to the economy of "it doesn't matter whether a cat is black or white as long as it catches mice". In comes Xi Jinping's new feline which will be forced to distribute the mice it catches in the name of "common prosperity". The implications for Tencent – and thus Naspers and Prosus – could hardly be more ominous.  Our partners at The Wall Street Journal this morning published an excellent explainer on the communist party's return to its core policy – click here.  Chinese capitalists led by Tencent have jumped into line, as you'll read in the piece on Tencent's results republished below, and an article headlined Rift Forms on Didi's Board Following Beijing's Regulatory Assault. – Alec Hogg

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