Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.<ul><li><a href='#lucror-entity-26970'>Meituan</a></li></ul>

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.Meituan

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet 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

<ul>
<li>Meituan reported C1Q24 revenue 6.0%/6.2% higher our estimate/consensus, and adjusted net income 19%/29% higher than our estimate/consensus. The stock fell on lower takeout order and in-store revenue guidance for C2Q24;</li>
<li>The stock has two uncertainties:(1)Strategic moves by Douyin and Eleme,(2)success of overseas expansion. There are no easy answers to these two questions but we believe the corner has been turned</li>
<li>We maintain the stock as BUY rating and raise TP to HK$156/share to factor in the improvement in profitability.</li>
</ul>


Meituan reported C1Q24 revenue 6.0%/6.2% higher our estimate/consensus, and adjusted net income 19%/29% higher than our estimate/consensus. The stock fell on lower takeout order and in-store revenue guidance for C2Q24;
The stock has two uncertainties:(1)Strategic moves by Douyin and Eleme,(2)success of overseas expansion. There are no easy answers to these two questions but we believe the corner has been turned
We maintain the stock as BUY rating and raise TP to HK$156/share to factor in the improvement in profitability.


[Meituan (3690 HK, BUY, TP HK$156) TP Change]: Counting on Execution to Navigate the Uncertainties

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>Meituan reported (6 Jun) its 1Q24 results: revenue was RMB73.3bn, up 25% YoY, 4/6% higher than our estimate/Bloomberg consensus estimate.</li><li>Adjusted net profit during 1Q24 reached RMB7.5bn, better than our estimate/consensus at RMB5.5bn/5.8bn, due to both better-than-expected operating profit (OP) generated from core local commerce (CLC) business, aided by better-thanexpected order volume growth of on-demand delivery business, and narrowerthan-expected loss generated from new business, in particular the narrowerthan-expected loss generated from Meituan Select.</li><li>We are more positive on Meituan’s 2024E net profit growth prospects, given its likely better unit economics (UE) outlook for on-demand delivery business with the optimization of subsidies and increase in monetization from advertising business, as well as potentially greater loss reduction from Meituan Select. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Meituan reported (6 Jun) its 1Q24 results: revenue was RMB73.3bn, up 25% YoY, 4/6% higher than our estimate/Bloomberg consensus estimate.Adjusted net profit during 1Q24 reached RMB7.5bn, better than our estimate/consensus at RMB5.5bn/5.8bn, due to both better-than-expected operating profit (OP) generated from core local commerce (CLC) business, aided by better-thanexpected order volume growth of on-demand delivery business, and narrowerthan-expected loss generated from new business, in particular the narrowerthan-expected loss generated from Meituan Select.We are more positive on Meituan’s 2024E net profit growth prospects, given its likely better unit economics (UE) outlook for on-demand delivery business with the optimization of subsidies and increase in monetization from advertising business, as well as potentially greater loss reduction from Meituan Select. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Meituan (3690 HK) - 1Q Results Pointed to a Better Full-Year Earnings Growth Outlook

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Shareholders of <a href="https://www.smartkarma.com/entities/prosus-nv" target="_blank" data-smartkarma-citation="entities:28104:1" rel="noopener">Prosus NV (PRX NA)</a> and <a href="https://www.smartkarma.com/entities/naspers-ltd" target="_blank" data-smartkarma-citation="entities:21085:1" rel="noopener">Naspers (NPN SJ)</a> approved AGM agenda items late last week to enable the two Capitalisation Issues and Naspers' Share Consolidation to move forward.</li>
<li>What Will Happen: Prosus will issue new N shares to its shareholders and Naspers will reject them. Naspers will issue new shares to its shareholders, and Prosus will reject them.</li>
<li>Naspers will own ~42.9% of Prosus, Prosus will own 0.02% of Naspers. Sales of Tencent shares will continue. Share Buybacks too. But the ouroboros will have spit out its tail. </li>
</ul>


Shareholders of Prosus NV (PRX NA) and Naspers (NPN SJ) approved AGM agenda items late last week to enable the two Capitalisation Issues and Naspers' Share Consolidation to move forward.
What Will Happen: Prosus will issue new N shares to its shareholders and Naspers will reject them. Naspers will issue new shares to its shareholders, and Prosus will reject them.
Naspers will own ~42.9% of Prosus, Prosus will own 0.02% of Naspers. Sales of Tencent shares will continue. Share Buybacks too. But the ouroboros will have spit out its tail. 


Prosus/Naspers - The ουροβóρος Is Dead! Long Live The Ouroboros!

China/Asia TMT

Shawn Yang

<ul>
<li>We upgrade Meituan to BUY as (1) its recent subsidy campaign vs. Douyin has achieved some  successes, and (2) its food delivery margin may have further upside; </li>
<li>We suggest that Douyin’s local service market share reaches a high level, especially when compared with its eCommerce market share; </li>
<li>Our C1Q23 top/bottom line are in-line/25.5% vs. cons. Raise TP to HK$ 165, which implies 4x PS/12x PE/1x PS for delivery/in-store/new initiatives.</li>
</ul>


We upgrade Meituan to BUY as (1) its recent subsidy campaign vs. Douyin has achieved some  successes, and (2) its food delivery margin may have further upside; 
We suggest that Douyin’s local service market share reaches a high level, especially when compared with its eCommerce market share; 
Our C1Q23 top/bottom line are in-line/25.5% vs. cons. Raise TP to HK$ 165, which implies 4x PS/12x PE/1x PS for delivery/in-store/new initiatives.


[Meituan (3690 HK) Rating Change]: Meituan’s Counterstrike Is Effective, Upgrade to BUY

China

Meituan operates as a web based shopping platform for locally found consumer products and retail services. The Company offers deals of the day by selling vouchers on local services and entertainment, dining, delivery, and other services. Meituan provides its services throughout China.

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Meituan (3690 HK)

Morning Views Asia: Meituan

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

[Meituan (3690 HK, BUY, TP HK$156) TP Change]: Counting on Execution to Navigate the Uncertainties

Meituan beats revenue and net income estimates in Q1 but stock falls on lower guidance for Q2. Uncertainties remain with competition and overseas...

Blue Lotus Research Institute

Meituan (3690 HK) - 1Q Results Pointed to a Better Full-Year Earnings Growth Outlook

Meituan reported (6 Jun) its 1Q24 results: revenue was RMB73.3bn, up 25% YoY, 4/6% higher than our estimate/Bloomberg consensus estimate.

CMB International

Prosus/Naspers - The ουροβóρος Is Dead! Long Live The Ouroboros!

The Prosus/Naspers Ouroboros is Dead. Long live the Prosus/Naspers Ouroboros. Prosus is an Accretion Engine. Know it. Use it.

Travis Lundy

[Meituan (3690 HK) Rating Change]: Meituan’s Counterstrike Is Effective, Upgrade to BUY

We upgrade Meituan to BUY as (1) its recent subsidy campaign vs. Douyin has achieved some successes, and (2) its food delivery margin may have...

Blue Lotus Research Institute

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Morning Views Asia: Meituan

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

[Meituan (3690 HK, BUY, TP HK$156) TP Change]: Counting on Execution to Navigate the Uncertainties

​Meituan beats revenue and net income estimates in Q1 but stock falls on lower guidance for Q2. Uncertainties remain with competition and overseas...

Blue Lotus Research Institute

Meituan (3690 HK) - 1Q Results Pointed to a Better Full-Year Earnings Growth Outlook

Meituan reported (6 Jun) its 1Q24 results: revenue was RMB73.3bn, up 25% YoY, 4/6% higher than our estimate/Bloomberg consensus estimate.

CMB International

Prosus/Naspers - The ουροβóρος Is Dead! Long Live The Ouroboros!

The Prosus/Naspers Ouroboros is Dead. Long live the Prosus/Naspers Ouroboros. Prosus is an Accretion Engine. Know it. Use it.

Travis Lundy

[Meituan (3690 HK) Rating Change]: Meituan’s Counterstrike Is Effective, Upgrade to BUY

We upgrade Meituan to BUY as (1) its recent subsidy campaign vs. Douyin has achieved some successes, and (2) its food delivery margin may have...

Blue Lotus Research Institute

Meituan beats revenue and net income estimates in Q1 but stock falls on lower guidance for Q2. Uncertainties remain with competition and overseas...