Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Equity Bottom-Up

Trip.com Group Ltd. provides online travel agency services. The Company offers mobile applications, hotel reservations, flight ticketing, package tours, corporate travel management, and train ticketing services.

<ul>
<li>TCOM reported C3Q24 revenue 1.4%/1.6% higher than our est./cons., non-GAAP operating income is 12.5%/5.4% higher than our est./cons., mainly due to strong domestic sales and efficient cost control.</li>
<li>We expect revenue growth to accelerate in 4Q24 and 2025,backed by domestic travel recovery and steady overseas expansion.AI powered cost saving bringing extra leverage in margin is an additional positive.</li>
<li>We keep the stock as BUY rating and raise TP to US$74/ADS.</li>
</ul>


TCOM reported C3Q24 revenue 1.4%/1.6% higher than our est./cons., non-GAAP operating income is 12.5%/5.4% higher than our est./cons., mainly due to strong domestic sales and efficient cost control.
We expect revenue growth to accelerate in 4Q24 and 2025,backed by domestic travel recovery and steady overseas expansion.AI powered cost saving bringing extra leverage in margin is an additional positive.
We keep the stock as BUY rating and raise TP to US$74/ADS.


[Trip.com (TCOM US, BUY, TP US$74) Target Price Change]: C3Q24 Review: Domestic Story Back in Focus

Xiaomi Corporation manufactures communication equipment and parts. The Company produces and sells mobile phones, smart phone software,  set-top boxes, and related accessories. Xiaomi markets its products worldwide.

<ul>
<li>Xiaomi reported CY3Q24 revenue, non-IFRS EBIT and non-IFRS net income 4.7%, 7.8%, and 16.6% vs. consensus. </li>
<li>C4Q should be even stronger, as (1) appliance subsidy drive IoT revenue and margin improvement, (2) SU7 production output ~doubles</li>
<li>We reiterate Xiaomi as our TOP BUY idea and raise Xiaomi’s TP to HK$ 33 to reflect the improved profit outlook. Our TP implies 26.6x CY25 P/E.</li>
</ul>


Xiaomi reported CY3Q24 revenue, non-IFRS EBIT and non-IFRS net income 4.7%, 7.8%, and 16.6% vs. consensus. 
C4Q should be even stronger, as (1) appliance subsidy drive IoT revenue and margin improvement, (2) SU7 production output ~doubles
We reiterate Xiaomi as our TOP BUY idea and raise Xiaomi’s TP to HK$ 33 to reflect the improved profit outlook. Our TP implies 26.6x CY25 P/E.


[Xiaomi Inc. (1810 HK, BUY, TP HK$33) Target Price Change]: Good Result, and It Will Only Get Better

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

Thematic (Sector/Industry)

<ul>
<li>Gaming Sector Update/NTES US: NPPA Releases November Domestic and Imported Game Approvals(+)</li>
<li>3690 HK/Douyin:Douyin Local Life’s Double 11 Sales Increase by 53% YoY, Indicating Rising Consumer Spending in China, Bodes Well for Meituan.(+)</li>
<li>BABA US/PDD US/JD US: Taobao/Tmall launches “Go Bargain” feature (+/+/+)</li>
</ul>


Gaming Sector Update/NTES US: NPPA Releases November Domestic and Imported Game Approvals(+)
3690 HK/Douyin:Douyin Local Life’s Double 11 Sales Increase by 53% YoY, Indicating Rising Consumer Spending in China, Bodes Well for Meituan.(+)
BABA US/PDD US/JD US: Taobao/Tmall launches “Go Bargain” feature (+/+/+)


[Blue Lotus Daily-TMT Update]:Gaming Sector Update/NTES US/3690 HK/Douyin/BABA US/PDD US/JD US/700HK

<ul>
<li>1211 HK/TSLA US/1810 HK/NIO US/LI US/XPEV US/ZK US/9863 HK:In the 46th week of 2024, market demand is booming and new brands gain market share.(///////////////)</li>
<li>XPEV US: Xpeng's vehicle revenue and gross profit margin exceeded expectations in the third quarter, but service revenue was lower than expected, resulting in lower-than-expected profits.(/)</li>
<li>LKNCY US: Luckin Signs Memorandum for Brazilian Coffee Bean Purchases.(+)</li>
</ul>


1211 HK/TSLA US/1810 HK/NIO US/LI US/XPEV US/ZK US/9863 HK:In the 46th week of 2024, market demand is booming and new brands gain market share.(///////////////)
XPEV US: Xpeng's vehicle revenue and gross profit margin exceeded expectations in the third quarter, but service revenue was lower than expected, resulting in lower-than-expected profits.(/)
LKNCY US: Luckin Signs Memorandum for Brazilian Coffee Bean Purchases.(+)


[Blue Lotus Daily]:1211 HK/TSLA US/1810 HK/NIO US/LI US/XPEV US/ZK US/9863 HK/LKNCY US

Alibaba Group Holding  / Equity Bottom-Up

Alibaba Group Holding Limited provides online sales services. The Company provides internet infrastructure, electronic commerce, online financial, and internet content services through its subsidiaries. Alibaba Group Holding offers its products and services worldwide.

<ul>
<li>BABA reported CY3Q24 top line, adjusted EBITA and non-GAAP net profit (1.0%), (1.6%) and in-line vs. consensus. </li>
<li>CMR improved amid monetization changes that narrowed the growth gap with GMV, but also eliminated some low-single profit sellers from its GMV. </li>
<li>Cloud and overseas e-commerce revenue also saw good growth and improved profitability. All of BABA’s key businesses are sputtering to life while macro tailwinds are also favorable. </li>
</ul>


BABA reported CY3Q24 top line, adjusted EBITA and non-GAAP net profit (1.0%), (1.6%) and in-line vs. consensus. 
CMR improved amid monetization changes that narrowed the growth gap with GMV, but also eliminated some low-single profit sellers from its GMV. 
Cloud and overseas e-commerce revenue also saw good growth and improved profitability. All of BABA’s key businesses are sputtering to life while macro tailwinds are also favorable. 


[Alibaba (BABA US, BUY, TP US$120) Earnings Review]: Progress Made, Better Times Ahead

Blue Lotus Research Institute
China growth and global non-US Internet equities

[Trip.com (TCOM US, BUY, TP US$74) Target Price Change]: C3Q24 Review: Domestic Story Back in Focus

TCOM beats revenue and operating income estimates in Q3, expects growth to accelerate in Q4 and 2025 with domestic travel recovery and overseas...

Blue Lotus Research Institute

[Xiaomi Inc. (1810 HK, BUY, TP HK$33) Target Price Change]: Good Result, and It Will Only Get Better

Xiaomi beats revenue expectations in CY3Q24, expected to strengthen in C4Q with IoT drive and production increase, leading to a raised price target.

Blue Lotus Research Institute

[Blue Lotus Daily-TMT Update]:Gaming Sector Update/NTES US/3690 HK/Douyin/BABA US/PDD US/JD US/700HK

China's gaming sector sees growth in domestic and imported game approvals, Douyin's Double 11 sales surge indicates higher consumer spending, and...

Blue Lotus Research Institute

[Blue Lotus Daily]:1211 HK/TSLA US/1810 HK/NIO US/LI US/XPEV US/ZK US/9863 HK/LKNCY US

Market demand is booming in 46th week of 2024, new brands gaining share; XPEV's Q3 revenue exceeds expectations but service revenue disappoints;...

Blue Lotus Research Institute

[Alibaba (BABA US, BUY, TP US$120) Earnings Review]: Progress Made, Better Times Ahead

BABA's latest financial report shows improved performance across key businesses, with growth in cloud and overseas e-commerce revenue.

Blue Lotus Research Institute

[Trip.com (TCOM US, BUY, TP US$74) Target Price Change]: C3Q24 Review: Domestic Story Back in Focus

​TCOM beats revenue and operating income estimates in Q3, expects growth to accelerate in Q4 and 2025 with domestic travel recovery and overseas...

Blue Lotus Research Institute

[Xiaomi Inc. (1810 HK, BUY, TP HK$33) Target Price Change]: Good Result, and It Will Only Get Better

​Xiaomi beats revenue expectations in CY3Q24, expected to strengthen in C4Q with IoT drive and production increase, leading to a raised price target.

Blue Lotus Research Institute

[Blue Lotus Daily-TMT Update]:Gaming Sector Update/NTES US/3690 HK/Douyin/BABA US/PDD US/JD US/700HK

​China's gaming sector sees growth in domestic and imported game approvals, Douyin's Double 11 sales surge indicates higher consumer spending, and...

Blue Lotus Research Institute

[Blue Lotus Daily]:1211 HK/TSLA US/1810 HK/NIO US/LI US/XPEV US/ZK US/9863 HK/LKNCY US

​Market demand is booming in 46th week of 2024, new brands gaining share; XPEV's Q3 revenue exceeds expectations but service revenue disappoints;...

Blue Lotus Research Institute

[Alibaba (BABA US, BUY, TP US$120) Earnings Review]: Progress Made, Better Times Ahead

​BABA's latest financial report shows improved performance across key businesses, with growth in cloud and overseas e-commerce revenue.

Blue Lotus Research Institute

TCOM beats revenue and operating income estimates in Q3, expects growth to accelerate in Q4 and 2025 with domestic travel recovery and overseas...

Xiaomi beats revenue expectations in CY3Q24, expected to strengthen in C4Q with IoT drive and production increase, leading to a raised price target.

China's gaming sector sees growth in domestic and imported game approvals, Douyin's Double 11 sales surge indicates higher consumer spending, and...

Market demand is booming in 46th week of 2024, new brands gaining share; XPEV's Q3 revenue exceeds expectations but service revenue disappoints;...

BABA's latest financial report shows improved performance across key businesses, with growth in cloud and overseas e-commerce revenue.