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>Kuaishou reported revenue/non-GAAP operating profit/GAAP net income 1.13%/35.0%/52.2% vs. our estimation.</li>
<li>The bottom-line beats were primarily due to reduced S&amp;M costs related to effective user retention strategies and the operation of the newly constructed data centre in Ulanqab...</li>
<li>We maintain our BUY rating and raised TP to HK$78 for a positive outlook in the e-commerce business and viral playlets, stimulating advertising growth...</li>
</ul>


Kuaishou reported revenue/non-GAAP operating profit/GAAP net income 1.13%/35.0%/52.2% vs. our estimation.
The bottom-line beats were primarily due to reduced S&amp;M costs related to effective user retention strategies and the operation of the newly constructed data centre in Ulanqab...
We maintain our BUY rating and raised TP to HK$78 for a positive outlook in the e-commerce business and viral playlets, stimulating advertising growth...


[Kuaishou (1024 HK, BUY, TP HK$78) TP Change]: Refined Operation Supports Sustainable Growth

Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>Kuaishou’s 3Q2023 earnings beat consensus estimates with significant improvement to the company’s profitability driven by growth across all business segments.</li>
<li>Operating losses of the overseas segment has further reduced, and new offerings such as paid mini dramas have been driving strong growth for the company.</li>
<li>Though Kuaishou’s share price has moved up during the last few months, valuation multiples are at a steep discount to historical multiples, suggesting there is further upside.</li>
</ul>


Kuaishou’s 3Q2023 earnings beat consensus estimates with significant improvement to the company’s profitability driven by growth across all business segments.
Operating losses of the overseas segment has further reduced, and new offerings such as paid mini dramas have been driving strong growth for the company.
Though Kuaishou’s share price has moved up during the last few months, valuation multiples are at a steep discount to historical multiples, suggesting there is further upside.


Kuaishou: Strong Earnings With Further Improvement in Profitability

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>Total revenue grew by 21% YoY in 3Q23, as both advertising and e-commerce expanded strongly.</li>
<li>KS achieved historical high operating margin and operating profit, as the company continue to cut all operating expenses.</li>
<li>We believe the stock has an upside of 63% and a price target of HK$95. Buy.</li>
</ul>


Total revenue grew by 21% YoY in 3Q23, as both advertising and e-commerce expanded strongly.
KS achieved historical high operating margin and operating profit, as the company continue to cut all operating expenses.
We believe the stock has an upside of 63% and a price target of HK$95. Buy.


KS (Kuaishou 1024 HK): 3Q23, High Growth and Higher Margin

<ul>
<li>All major Chinese e-commerce companies set up live broadcasting channels on Bilibili at the beginning of Singles’ Day sales.</li>
<li>Kuaishou chairman’s resignation will not change the business strategy, as he stepped down from CEO two years ago.</li>
<li>Baidu begins to sell ChatGPT-like service for CNY49.90 per month.</li>
</ul>


All major Chinese e-commerce companies set up live broadcasting channels on Bilibili at the beginning of Singles’ Day sales.
Kuaishou chairman’s resignation will not change the business strategy, as he stepped down from CEO two years ago.
Baidu begins to sell ChatGPT-like service for CNY49.90 per month.


China Consumption Weekly (6 Nov 2023): Kuaishou, Bilibili, Midea, Baidu, Yum China

<ul>
<li>We believe Mr. Su’s resignation as chairman is not a concern, because Mr. Cheng, the CEO, has been operating the company for two years.</li>
<li>We believe the 3Q23 YoY growth will be lower, as 2Q23 had a lower comparison base.</li>
<li>We believe the operating margin can be negative in 3Q23 as Q3 is always a weak season, but operating profit will break even for 2023.</li>
</ul>


We believe Mr. Su’s resignation as chairman is not a concern, because Mr. Cheng, the CEO, has been operating the company for two years.
We believe the 3Q23 YoY growth will be lower, as 2Q23 had a lower comparison base.
We believe the operating margin can be negative in 3Q23 as Q3 is always a weak season, but operating profit will break even for 2023.


Kuaishou/KS (1024 HK) Earnings Preview: Unnecessary Concerns About Chairman Change and 3Q23 Results

China

Kuaishou Technology operates as a content community and social platform. The Company helps users create, upload and watch short videos on mobile devices. Kuaishou Technology offers services worldwide.

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Kuaishou Technology (1024 HK)

[Kuaishou (1024 HK, BUY, TP HK$78) TP Change]: Refined Operation Supports Sustainable Growth

Kuaishou beats revenue and profit estimates, thanks to lower costs and new data center. Positive outlook for e-commerce and advertising growth....

Blue Lotus Research Institute

Kuaishou: Strong Earnings With Further Improvement in Profitability

Kuaishou's 3Q2023 earnings show increased profitability and growth across all segments. The company's share price has risen, but valuation...

Shifara Samsudeen, ACMA, CGMA

KS (Kuaishou 1024 HK): 3Q23, High Growth and Higher Margin

Total revenue grew by 21% YoY in 3Q23, as advertising and e-commerce expanded strongly. KS achieved historical high operating margin and operating...

Ming Lu

China Consumption Weekly (6 Nov 2023): Kuaishou, Bilibili, Midea, Baidu, Yum China

All major Chinese e-commerce companies set up live broadcasting channels on Bilibili for Singles’ Day sales. Kuaishou chairman resigned. Baidu...

Ming Lu

Kuaishou/KS (1024 HK) Earnings Preview: Unnecessary Concerns About Chairman Change and 3Q23 Results

Mr. Su’s resigned as chairman, but Mr. Cheng, the CEO, has been operating the company for two years. We believe the coming 3Q23 slowdown is due to...

Ming Lu

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Kuaishou (1024 HK, BUY, TP HK$78) TP Change]: Refined Operation Supports Sustainable Growth

​Kuaishou beats revenue and profit estimates, thanks to lower costs and new data center. Positive outlook for e-commerce and advertising growth....

Blue Lotus Research Institute

Kuaishou: Strong Earnings With Further Improvement in Profitability

​Kuaishou's 3Q2023 earnings show increased profitability and growth across all segments. The company's share price has risen, but valuation...

Shifara Samsudeen, ACMA, CGMA

KS (Kuaishou 1024 HK): 3Q23, High Growth and Higher Margin

Total revenue grew by 21% YoY in 3Q23, as advertising and e-commerce expanded strongly. KS achieved historical high operating margin and operating...

Ming Lu

China Consumption Weekly (6 Nov 2023): Kuaishou, Bilibili, Midea, Baidu, Yum China

All major Chinese e-commerce companies set up live broadcasting channels on Bilibili for Singles’ Day sales. Kuaishou chairman resigned. Baidu...

Ming Lu

Kuaishou/KS (1024 HK) Earnings Preview: Unnecessary Concerns About Chairman Change and 3Q23 Results

Mr. Su’s resigned as chairman, but Mr. Cheng, the CEO, has been operating the company for two years. We believe the coming 3Q23 slowdown is due to...

Ming Lu

Kuaishou beats revenue and profit estimates, thanks to lower costs and new data center. Positive outlook for e-commerce and advertising growth....

Kuaishou's 3Q2023 earnings show increased profitability and growth across all segments. The company's share price has risen, but valuation...