BOC International has published a research note reiterating a “Buy” rating on BILIBILI-W (09626), with the H-share target price maintained at HK$224. The brokerage highlighted that Bilibili announced a series of transactions after market close last Friday (September 4), which it believes resolves all divestment pressure from TENCENT (00700) in one decisive move.

The strategic package includes a proposed issuance of US$700 million in zero-coupon convertible bonds due 2031, carrying a conversion premium of approximately 35% and featuring an optional redemption right in 2029. Concurrently, Bilibili plans to repurchase and cancel shares totaling US$300 million through two separate mechanisms, resulting in net proceeds of roughly US$400 million.

The bank views this as a highly constructive and tailored solution for Bilibili, effectively mitigating the share price impact from both the proposed US$700 million convertible bond offering and the simultaneous one-off block trade by Tencent. Furthermore, Tencent’s US$200 million subscription to the convertible bonds underscores its confidence in Bilibili’s long-term upside potential.

BOC International holds a favorable outlook on Bilibili’s ability to deliver robust and sustainable profit growth, driven by its healthy “3C” flywheel, which is being further amplified by focused and disciplined AI execution.