Huya Operates a Mediocre Business, but We See Value in Its Cash Balance

Huya is China's largest game livestreaming platform with over 80 million monthly active users. As the market leader for years, Huya has maintained an edge over competitors on game content by signing exclusive licensing deals with esports tournaments. While this enhances user loyalty to the platform, we believe competition on licenses remains fierce, as peers will likely bid up for top events at time of renewals. In addition, we think slowing revenue growth will pressure Huya to sublicense some of its events to competitors, bridging the gap on content.