China/Asia TMT

Shawn Yang

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

Thematic (Sector/Industry)

<ul>
<li>PDD/CPNG/SE: PDD's Temu plans to come to Southeast Asia and South Korea,  negative to Shopee and Coupang (+/-/-)</li>
<li>KE Holding: New home sales remain lukewarm in May, leaving more space for potential incentive policies.</li>
<li>BILI: Bilibili's top anchor achieved a single-session GMV of 28 million yuan during the 618 live-streaming sales event (+)</li>
</ul>


PDD/CPNG/SE: PDD's Temu plans to come to Southeast Asia and South Korea,  negative to Shopee and Coupang (+/-/-)
KE Holding: New home sales remain lukewarm in May, leaving more space for potential incentive policies.
BILI: Bilibili's top anchor achieved a single-session GMV of 28 million yuan during the 618 live-streaming sales event (+)


China/Asia TMT Update-PDD/CPNG/SE/BEKE/BILI:PDD's Temu Plans to Come to ASEAN and South Korea

<ul>
<li>LKNCY: Luckin Coffee opened No.10k store, and extended discount coupon coverage (-)</li>
<li>U US: Apple provides Unity with unique development privileges for Vision Pro (+)</li>
<li>CPNG US: a congestion in the customs clearance process at Pyeongtaek Port due to a surge in packages from Chinese e-commerce platforms.(-)</li>
</ul>


LKNCY: Luckin Coffee opened No.10k store, and extended discount coupon coverage (-)
U US: Apple provides Unity with unique development privileges for Vision Pro (+)
CPNG US: a congestion in the customs clearance process at Pyeongtaek Port due to a surge in packages from Chinese e-commerce platforms.(-)


China/Asia TMT Update- Luckin/Unity/Coupang:No.10k Store, Apple Vision Pro, Congestion at Pyeongtaek

Equity Bottom-Up

<ul>
<li>CPNG reported C1Q23 top-line, EBITDA, and non-GAAP net income in-line, 8.1%, and (3.7%) vs. our est., and 3.1%, 8.2%, and in-line vs. cons., respectively. </li>
<li>We estimate CPNG’s penetration of its 3P marketplace fulfilment (FLC) rose 6ppts~ YoY to 20%~ in 1Q23. </li>
<li>We maintain our BUY rating and raise our TP to US$21.</li>
</ul>


CPNG reported C1Q23 top-line, EBITDA, and non-GAAP net income in-line, 8.1%, and (3.7%) vs. our est., and 3.1%, 8.2%, and in-line vs. cons., respectively. 
We estimate CPNG’s penetration of its 3P marketplace fulfilment (FLC) rose 6ppts~ YoY to 20%~ in 1Q23. 
We maintain our BUY rating and raise our TP to US$21.


[Coupang Inc. (CPNG US) Target Price Change]: Fulfilment of 3P Orders Is Next Revenue Driver

<ul>
<li>We expect CPNG to report C1Q23 top-line and non-GAAP net income 2.0% and 4.8% vs. consensus, respectively. </li>
<li>AliExpress became S. Korea’s most downloaded app after increasing spending, but product overlap with Coupang is limited, while other S. Korean competitors recorded declining MAU, in our understanding.</li>
<li>South Korean economic indicators, including CPI and retail data, point towards a recovery. We maintain our BUY rating and US$19 TP.</li>
</ul>


We expect CPNG to report C1Q23 top-line and non-GAAP net income 2.0% and 4.8% vs. consensus, respectively. 
AliExpress became S. Korea’s most downloaded app after increasing spending, but product overlap with Coupang is limited, while other S. Korean competitors recorded declining MAU, in our understanding.
South Korean economic indicators, including CPI and retail data, point towards a recovery. We maintain our BUY rating and US$19 TP.


[Coupang Inc. (CPNG US) Earnings Preview]: Market Share Solid Given Limited Competitive Threat

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

<ul>
<li>Record number of active EM funds overweight in Internet Retail, with 60.9% of funds overweight the iShares EEM ETF.</li>
<li>Alibaba Group Holdings is the most widely held stock in Internet Retail, followed by JD.com Inc. and MercadoLibre.</li>
<li>Growth investors remain optimistic about Internet Retail, while recent price declines prompt Value investors to raise allocations</li>
</ul>


Record number of active EM funds overweight in Internet Retail, with 60.9% of funds overweight the iShares EEM ETF.
Alibaba Group Holdings is the most widely held stock in Internet Retail, followed by JD.com Inc. and MercadoLibre.
Growth investors remain optimistic about Internet Retail, while recent price declines prompt Value investors to raise allocations


Internet Retail: EM Funds Raise Overweights

South Korea

Coupang, Inc. operates as an e-commerce company. The Company offers dynamic end-to-end e-commerce and logistic solutions. Coupang serves customers worldwide.

Price Gauge
52-week Range	0.00 - 0.00
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Coupang (CPNG US)

China/Asia TMT Update-PDD/CPNG/SE/BEKE/BILI:PDD's Temu Plans to Come to ASEAN and South Korea

PDD/CPNG/SE: PDD's Temu plans to come to Southeast Asia and South Korea，KE Holding: New home sales remain lukewarm in May, BILI: Bilibili's top...

Blue Lotus Research Institute

China/Asia TMT Update- Luckin/Unity/Coupang:No.10k Store, Apple Vision Pro, Congestion at Pyeongtaek

LKNCY: Luckin Coffee opened No.10k store (-)；U US: Apple provides Unity with unique development privileges for Vision Pro (+)；CPNG US: a congestion...

Blue Lotus Research Institute

[Coupang Inc. (CPNG US) Target Price Change]: Fulfilment of 3P Orders Is Next Revenue Driver

CPNG reported C1Q23 top-line, EBITDA, and non-GAAP net income in-line, 8.1%, and (3.7%) vs. our est., and 3.1%, 8.2%, and in-line vs. cons.,...

Blue Lotus Research Institute

Internet Retail: EM Funds Raise Overweights

The percentage of funds positioned overweight the Internet Retail sector hits record highs as Value funds enter the picture.

Steven Holden

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

China/Asia TMT Update-PDD/CPNG/SE/BEKE/BILI:PDD's Temu Plans to Come to ASEAN and South Korea

PDD/CPNG/SE: PDD's Temu plans to come to Southeast Asia and South Korea，KE Holding: New home sales remain lukewarm in May, BILI: Bilibili's top...

Blue Lotus Research Institute

China/Asia TMT Update- Luckin/Unity/Coupang:No.10k Store, Apple Vision Pro, Congestion at Pyeongtaek

LKNCY: Luckin Coffee opened No.10k store (-)；U US: Apple provides Unity with unique development privileges for Vision Pro (+)；CPNG US: a congestion...

Blue Lotus Research Institute

[Coupang Inc. (CPNG US) Target Price Change]: Fulfilment of 3P Orders Is Next Revenue Driver

CPNG reported C1Q23 top-line, EBITDA, and non-GAAP net income in-line, 8.1%, and (3.7%) vs. our est., and 3.1%, 8.2%, and in-line vs. cons.,...

Blue Lotus Research Institute

[Coupang Inc. (CPNG US) Earnings Preview]: Market Share Solid Given Limited Competitive Threat

AliExpress became S. Korea’s most downloaded app after increasing spending, but product overlap with Coupang is limited, while other S. Korean...

Blue Lotus Research Institute

Internet Retail: EM Funds Raise Overweights

The percentage of funds positioned overweight the Internet Retail sector hits record highs as Value funds enter the picture.

Steven Holden