China approved 88 new domestic videogames Tuesday after a long lull in such approvals - and the size and speed of the move are a strong signal of normalization, Citi says in reaction.
The 88 games included those from bigger studios that were recently hit by a crackdown on such approvals, including Tencent Holdings ( OTCPK:TCEHY ) and NetEase ( NASDAQ: NTES ), analyst Alicia Yap noted.
It had seemed unlikely that the year's first batch of approvals would come before Chinese New Year, given an early holiday this year and the fact that the last batch came toward the end of December.
"The slightly bigger batch size first out of the gate for 2023 and three consecutive months of domestic approvals reaffirm positive signals of a normalized approval process and indicate supportive regulatory policy for the gaming industry," Yap said, suggesting it points toward a potential 1,000 licenses for 2023 and saying Citi is "constructive" on Chinese online gaming.
The approvals included notable titles like Undawn, Alchemy Stars and Yuan Meng Zhi Xing from Tencent ( OTCPK:TCEHY ) and Badlanders from NetEase ( NTES ).
"We welcome the positive news and believe it represents the much-needed CNY gift to further boost industry sentiment and reaffirm supportive regulatory policy," Yap said.
For further details see:
Citi sees rebound taking shape with Chinese videogame approvals