What’s new: Kuaishou’s reported 1Q24 results that top consensus and our expectations. OMS could remain resilient partly driven by closed-loop ads and continued recovery in external ads. Margins could further improve YoY in FY24 amid a better revenue mix and continued cost controls. We maintain our PT at HKD95. Analysts: Jin Yoon
Kuaishou’s 1Q24 results delivered a strong earnings beat. Revenue increased 17% yoy to Rmb29.4b, in line with consensus estimates. Gross profit margin improved 8ppt yoy to 55%. Non-IFRS profit for the period was Rmb4.4b, compared with Rmb42m in 1Q23, beating consensus estimates. Management guided softer 2Q24 revenue growth of 10% due to a high base with earnings 16% higher than consensus estimates. Maintain BUY with an unchanged target price of HK$85.00.
KEY HIGHLIGHTS Sector Automobile China’s EV companies generally saw a wow drop in retail sales in the week ending 19 May 24, due to a high comparison base in the second week of May. BYD saw a yoy sales decline during the week, the first time over the last three years except during the Lunar New Year holiday. Li Auto posted disappointing 1Q24 results with operating profit and cash flow turning negative. Maintain MARKET WEIGHT. Top BUYs: Geely, CATL and Tuopu. Top SELLs: Li Auto and XPeng. Res...
GREATER CHINA Sector Automobile Weekly: PEV sales drop wow due to high comparison base. Maintain MARKET WEIGHT. Top BUYs: Geely, CATL and Tuopu. Top SELLs: Li Auto and XPeng. Results Kuaishou (1024 HK/BUY/HK$58.15/Target: HK$85.00) 1Q24: Solid earnings beat; softer 2Q24; HK$16b share repurchase plan. Pinduoduo (PDD US/BUY/US$145.45/Target: US$200.00) 1Q24: Robust earnings beat; stro...
GREATER CHINA Strategy Alpha Picks: May Conviction Call: Adding CR Beer, Crystal, Geely, Haier, Kuaishou, Ningbo Tuopu, Pinduoduo, Shenzhou, and Tencent to our BUY list, closing out SELL calls. INDONESIA Strategy Alpha Picks: Slight Outperformance In A Bear Market: Our picks are BSDE, TLKM, ACES, BBTN, CMRY, SIDO, JSMR and AKRA. MALAYSIA Strategy Alpha Picks: Well-Positioned For 1Q Results Season: Our April picks again beat the KLCI. May 24 picks: GENM, Inari, Mah Sing, MrDIY, MYEG, Press Meta...
GREATER CHINA Strategy Alpha Picks: May Conviction Call Adding CR Beer, Crystal, Geely, Haier, Kuaishou, Ningbo Tuopu, Pinduoduo, Shenzhou, and Tencent to our BUY list, closing out SELL calls. Small-Mid Cap Monthly Reiterate BUY on Crystal International. Sector Automobile Weekly: EV sales pick up; take...
The HSI and MSCI China rose 7.4% and 6.4% mom respectively in April, lifted by news of a stock connect scheme expansion and further easing of restrictions on property purchases in China. With the July Politburo likely to see further supportive policy rollout, we are adding beneficiaries of improving domestic consumption − CR Beer, Crystal, Geely, Haier, Kuaishou, Ningbo Tuopu, Pinduoduo, Shenzhou and Tencent − to our BUY list, and closing out our SELL calls.
Given the stabilising revenue growth and abundant cash on hand, mega-cap internet companies have been focusing on offering generous shareholder returns. For 2024, we expect consumption behaviour to switch to service and experience, which will continue to benefit OTA players. We believe other China internet names will outperform with overseas expansion and SFV players will continue to gain market shares with potential for take rate increases. Maintain MARKET WEIGHT.
What’s new: Kuaishou’s reported 4Q23 revs were largely in-line with consensus and our expectations. User traffic could remain healthy as Kuaishou could reach 400mn DAU by 2H24. Margins could also continue to see upside partly driven by better rev mix and improved efficiency in marketing spending. We maintain our PT at HKD95. Analysts: Jin Yoon
Kuaishou’s 4Q23 results delivered a strong earnings beat. Revenue increased 15% yoy to Rmb32.6b, in line with consensus estimates. Gross margin improved 7.6ppt yoy to 53%. Non-IFRS profit for the period was Rmb4.4b, compared with Rmb3.2b in 3Q23, beating consensus estimates. Management guided a solid 1Q24 revenue growth of midteens and earnings to be 30% higher than current consensus estimates. Maintain BUY with an unchanged target price of HK$85.00.
KEY HIGHLIGHTS Results Anhui Conch Cement (914 HK/BUY/HK$17.20/Target: HK$21.00) 2023: In line; all set to expand market share. CSPC Pharmaceutical Group (1093 HK/BUY/HK$6.41/Target: HK$7.80) 2023: Results in line; expects double-digit revenue and earnings growth in 2024. Geely Auto (175 HK/BUY/HK$8.83/Target: HK$11.00) 2023: Results beat on margins again; upgrade to BUY. Raise target price from HK$6.50 to HK$11.00. Innovent Biologics (1801 HK/BUY/HK$39.35/Target: HK$60.00) 2023: Results ...
GREATER CHINA Results Geely Auto (175 HK/BUY/HK$8.83/Target: HK$11.00): 2023: Results beat on margins again; upgrade to BUY. Raise target price from HK$6.50 to HK$11.00. Innovent Biologics (1801 HK/BUY/HK$39.35/Target: HK$60.00): 2023: Results beat; well positioned for sustainable growth in 2024. Kuaishou (1024 HK/BUY/HK$52.25/Target: HK$85.00): 4Q23: Resilient earnings beat; strong ad monetisation momentum continues. Li Ning (2331 HK/HOLD/HK$21.45/Target: HK$19.60): 2023: Results miss; remain c...
GREATER CHINA Strategy Alpha Picks: March Conviction Call: Adding CMB, COLI, CR Beer, Kuaishou and TUL to our BUY list, closing out SELL calls. INDONESIA Strategy Alpha Picks: Significant Outperformance In Feb 24: Our picks are BBTN, CMRY, SIDO, EXCL, MAPI, JSMR, CTRA, MYOR and AKRA. MALAYSIA Strategy Alpha Picks: Focusing On Earnings Momentum: Our Alpha Picks underperformed the KLCI in Feb 24 (-0.9% vs 2.5%). Mar 24 picks significantly feature companies with good earnings momentum. SINGAPORE...
The HSI and MSCI China rose 6.6% and 8.2% mom respectively in Feb 24, mainly contributed by heavy-weighted IT and consumer discretionary stocks amid strongerthan- expected policy easing, which led to improved market sentiment. We expect sentiment to remain positive in March, as further macro supportive measures should be unveiled during the Two Sessions. We are adding CMB, COLI, CR Beer, Kuaishou and TUL to our BUY list and closing out the SELL ideas.
What’s New: We nudge down our 4Q total revenues partly due to slowdown in gaming (recognized in other revenues), but up our margin estimates amid continued optimization in revenue sharing fees, server + bandwidth, and S&M related costs. In this note, we discuss about the latest updates on the business including financial outlook and user trends in 4Q. Analysts: Jin Yoon
What's new: Kuaishou’s reported 3Q23 results were above consensus and our expectations driven by resiliency in ads. User traffic could remain healthy where DAU could grow by low-single digit YoY, while average daily time spent could remain above 120 mins in 4Q. Margins could see further upside partly driven by better efficiency in marketing spending and continued cost controls. We maintain our PT at HKD 95. Analysts: Jin Yoon
Kuaishou’s 3Q23 results saw a solid earnings beat. Revenue increased 21% yoy to Rmb27.9b, in line with the street’s estimates. Gross profit margin improved 5ppt yoy to 52%. Non-IFRS profit for the period was Rmb3.2b, compared with Rmb2.7b in 2Q23, beating the street’s estimates. Management also guided for a solid 4Q23 with mid-teens yoy revenue growth. The company remains confident about achieving Rmb2t in ecommerce GMV by 2025. Maintain BUY. Target price: HK$97.00.
KEY HIGHLIGHTS Sector Industrial Automation Demand stabilises with marginal recovery in 4Q23, demand driver to shift in 2024. Downgrade to MARKET WEIGHT. Results Baidu Inc (9888 HK/BUY/HK$107.40/Target: HK$166.00) 3Q23: Earnings beat; expecting monetisation of ERNIE 4.0. Kuaishou Technology (1024 HK/BUY/HK$58.50/Target: HK$97.00) 3Q23: Solid earnings beat; key beneficiary of adtech tailwinds. Miniso (MNSO US/NOT RATED/US$27.66) 1QFY24: Earnings beat; strong growth from overseas and...
Taobao, JD, PDD and Kuaishou kicked off pre-sales/11.11 promotions on 24, 23, 20 and 18 October respectively. 11.11 pre-sales data showed signs of pent-up demand release following pressured 3Q23 NBS consumption data. To revitalise the soft macro environment, multiple platforms have adopted low price strategies for users to acquire high-value products at more affordable prices. We remain upbeat on China’s ecommerce sector pending an encouraging recovery in 4Q23. Maintain MARKET WEIGHT.
Concerns of slowing growth momentum weighed on Chinese equities, with MSCI China and the HSI falling 4.4% and 3.9% respectively in October. Despite the show of support from Central Huijin, near-term trading could stay volatile as investors await better macro data or further policy support. We add a mix of defensives and turnaround stocks − COSCO Shipping, CR Mixc, Great Wall Motor, Innovent, Link REIT and NetEase − to our BUY list.
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