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QuestionsCategory: Financials QuadrantCOGS for Tencent
CY asked 2 years ago

Hi Victor, in the annual report of tencent, I cannot find the COGS. But there\\\\\\\’s a Cost of revenues. 
Is Cost of revenue same as cost of goods solds for tencent?

4 Answers
CY answered 2 years ago

Hi Victor,
To add – the financial figures in tencent annual reports are in RMB. So in the excel from Fifthperson, i selected “RMB”. 
However, in the “Share Price” cells, how should i reflect the share price since tencent is in “HKD” or “USD”?
Do i do HKD to RMB conversion? E.g. The share price of tencent in 2020 is HKD566. To fill in the “Share Price” cells, i should fill in “470.8” since the excel is using “RMB?

Victor Chng answered 2 years ago

Hi Charis,
Good effort and keep up the good work :)

I had look through your excel and most of the figure are fine except a few as stated below:
1.For cash & cash equivalent segment – This are the figures that you should use: Other financial assets, Financial assets at fair value through profit or loss, term deposits & Cash and cash equivalents. (2020: RMB 229B)
2.For payable – just take the account payable.
3.For Debt – This are the figure – Borrowings and Notes payable
4.Your financial numbers are recorded in billion so your number of share also have to be in billion. Tencent have split the shares before so you need to adjust for splits. 
Regarding your other questions. Please see below:

  • The COGS for tencent is cost of revenue. 
  • You can convert the share price from HKD to RMB and input into the excel. 
  • When you want to calculate the intrinsic value, you just take the RMB EPS and convert HKD.
  • Regarding the PE difference with Yahoo finance, May I know whether the PE ratio you obtained is calculated by yourself or from yahoo finance?


Wilfred Yang answered 2 years ago

Hi Victor
Want to build on this question. Can you share how to account for share splits?

Victor Chng answered 2 years ago

Hi Wilfred,
You have to adjusted by the numbers of share for the previous years. For example:
Number of shares
FY2010: 100m
FY2011: 100m
FY2012: 200m (Company decided to split in 2012)
In the above scenario, you have to adjust teh FY2010 and FY2011 number of shares by multiply each year by 2x to give you 200m shares.