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

<ul>
<li>We notice a pickup in consumer acceptance of instrashopping, as result of COVID-cultivated behavior. We notice similar business model worked outside of China (Coupang) for densely populated urban upper-middle-class customers;</li>
<li>Meituan's launch of membership is a wise step towards strengthening user stickiness and emphasizing transaction soundness over impulsive buying. Meituan's portfolio in food, dining, hotel &amp; travel offer unparalleled value;</li>
<li>We see Meituan's success in Hong Kong honed a replicable business model targeting single and low priced segment. Consolation on a global scale now seems a possibility.</li>
</ul>


We notice a pickup in consumer acceptance of instrashopping, as result of COVID-cultivated behavior. We notice similar business model worked outside of China (Coupang) for densely populated urban upper-middle-class customers;
Meituan's launch of membership is a wise step towards strengthening user stickiness and emphasizing transaction soundness over impulsive buying. Meituan's portfolio in food, dining, hotel &amp; travel offer unparalleled value;
We see Meituan's success in Hong Kong honed a replicable business model targeting single and low priced segment. Consolation on a global scale now seems a possibility.


Meituan (3690 HK): Out of the Woods and Light a Fire

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

Consumer Analyst / Channel Surveillance Specialist, Trudence Capital Advisors

Pranav Bhavsar

Consumer Analyst / Channel Surveillance Specialist

Trudence Capital Advisors

Trudence Capital Advisors Private Limited is a SEBI-registered Research Analyst, holding SEBI registration number INH000015747. Our firm is dedicated to providing independent and unbiased research on Indian mid to large-cap companies. Trudence Capital is known for its counter-consensus views, with a focus on forensic research and on-ground primary investigations. Our research approach is thorough, involving detailed analysis of accounting practices and governance, alongside extensive channel checks.

Independent & Unbiased Research

<ul>
<li>
<a href="https://www.smartkarma.com/entities/phonepe-pvt-ltd" target="_blank" data-smartkarma-citation="entities:34788:1" rel="noopener">Phonepe Pvt Ltd (1732974D IN)</a> 's new app, "Pincode", is based on the ONDC platform and offers hyperlocal e-commerce.</li>
<li>ONDC-Enabled Pincode could disrupt <a href="https://www.smartkarma.com/entities/zomato-ltd" target="_blank" data-smartkarma-citation="entities:28820:1" rel="noopener">Zomato (ZOMATO IN)</a> food delivery and grocery businesses.</li>
<li>Loyal restaurants may choose to offer discounts via ONDC, putting pressure on <a href="https://www.smartkarma.com/entities/zomato-ltd" target="_blank" data-smartkarma-citation="entities:28820:1" rel="noopener">Zomato (ZOMATO IN)</a>  and <a href="https://www.smartkarma.com/entities/bundl-technologies-private-limited-swiggy" target="_blank" data-smartkarma-citation="entities:35630:1" rel="noopener">Swiggy (1255298D IN)</a> to compete bringing back cash burn and discounting. </li>
</ul>



Phonepe Pvt Ltd (1732974D IN) 's new app, "Pincode", is based on the ONDC platform and offers hyperlocal e-commerce.
ONDC-Enabled Pincode could disrupt Zomato (ZOMATO IN) food delivery and grocery businesses.
Loyal restaurants may choose to offer discounts via ONDC, putting pressure on Zomato (ZOMATO IN)  and Swiggy (1255298D IN) to compete bringing back cash burn and discounting. 


Zomato (ZOMATO IN) | Houston, We Have A "Pincode" Problem

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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>On 16th Nov 22, post-market close, along with its 3Q22 results Tencent declared an interim dividend by way of distribution in specie of Class B Ordinary shares of Meituan.</li>
<li>At the time of declaration, the dividend amounted to US$20bn or 15.5% of Meituan’s outstanding shares. Its value has since declined to US$17bn</li>
<li>We have covered the background of the event in our previous notes. In this note, we talk about the recent updates.</li>
</ul>


On 16th Nov 22, post-market close, along with its 3Q22 results Tencent declared an interim dividend by way of distribution in specie of Class B Ordinary shares of Meituan.
At the time of declaration, the dividend amounted to US$20bn or 15.5% of Meituan’s outstanding shares. Its value has since declined to US$17bn
We have covered the background of the event in our previous notes. In this note, we talk about the recent updates.


Tencent Meituan Dividend - The US$17bn Overhang Is Here - Not All Shares in CCASS, Here We Go Again!

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)

Meituan (3690 HK): Out of the Woods and Light a Fire

Meituan plans to launch a comprehensive membership program as it extends instrashopping from grocery to daily goods, positive for its profit...

Blue Lotus Research Institute

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

Zomato (ZOMATO IN) | Houston, We Have A "Pincode" Problem

Emergence of ONDC and PhonePe's Pincode app likely to disrupt food delivery and grocery businesses of Zomato and Swiggy, bringing back cash burn...

Pranav Bhavsar

Tencent Meituan Dividend - The US$17bn Overhang Is Here - Not All Shares in CCASS, Here We Go Again!

On 16th Nov 22, Tencent declared an interim dividend by way of distribution in specie of Class B Ordinary shares of Meituan. The settlement was...

Sumeet Singh

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Meituan (3690 HK): Out of the Woods and Light a Fire

​Meituan plans to launch a comprehensive membership program as it extends instrashopping from grocery to daily goods, positive for its profit...

Blue Lotus Research Institute

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

Zomato (ZOMATO IN) | Houston, We Have A "Pincode" Problem

Emergence of ONDC and PhonePe's Pincode app likely to disrupt food delivery and grocery businesses of Zomato and Swiggy, bringing back cash burn...

Pranav Bhavsar

Tencent Meituan Dividend - The US$17bn Overhang Is Here - Not All Shares in CCASS, Here We Go Again!

On 16th Nov 22, Tencent declared an interim dividend by way of distribution in specie of Class B Ordinary shares of Meituan. The settlement was...

Sumeet Singh

Meituan plans to launch a comprehensive membership program as it extends instrashopping from grocery to daily goods, positive for its profit...