HUYA Inc (HUYA US) Buy: Unwavering conviction

Research evidence excerpt

HUYA Inc (HUYA US) Buy: Unwavering conviction

, i.e. total return at 15% of current market cap. As of end-

52-WEEK PRICE (USD)

March 2026, Huya has USD505m cash on hand (67% of market cap in cash).

5.30

GGD’s p ss p s : Based on Sensortower’s data, assuming

3.45

iOS contributes 40% of total gross billings (GB), daily GB now averages RMB3.1m.

The annual run-rate of RMB1.1bn has exceeded our prior expectations of RMB840m. 05/25 11/25 05/261.60

We lift DDG’s GB in 2026e to RMB1bn. However, we expect EBIT contributions to be Target price: 4.50 High: 4.88 Low: 2.05 Current: 3.28

more back-end loaded in 2H26/2027 given higher promotion costs to grow DAU (3m Source: LSEG IBES, HSBC estimates

so far, per Questmobile) and user engagement in the near term. Going forward, GGD

will focus on three areas: 1) strengthening UGC mechanism, 2) adding social and Ritchie Sun*, CFA

community feature (e.g. interplayer connection, home decoration system, team-up Analyst, Internet Research

The Hongkong and Shanghai Banking Corporation Limited

interactions), 3) launching a mini game version in the summer to grow the user base. ritchie.k.h.sun@hsbc.com.hk

+852 2822 4392

Other games in the pipeline: Huya has an exclusive licence to publish a new casual

game in mainland China, Hong Kong, Macau and Taiwan in the summer. The game has * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

a strong track record overseas, accumulating over 10m downloads and remaining a top not registered/ qualified pursuant to FINRA regulations

grossing title in the 3D puzzle matching category. In addition, Huya will launch a self-

developed casual mini game and a MMO title from Kingsoft later this year.

1Q26 results: Game-related services, advertising and other revenues grew 69% yoy,