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

[PDD US]: Slowing Growth but Still Best-In-Class, Cut TP Maintain BUY.

[PDD Holdings Inc. (PDD US, BUY, TP US$95) Earnings Preview]: BUY on Expected Margin Beat

Pinduoduo(PDD US): The Worst Is yet to Come

Pinduoduo: Untaming TEMU Through $100 Coupons

Pinduoduo (PDD US) – Resilient GMV growth to sustain in 2023

China/Asia TMT

Shawn Yang

Equity Bottom-Up

<ul>
<li>We conducted interviews with Temu and Shein merchants. We expect Temu to be more aggressive in expansion. Most metrics of Temu are improving, and it creates increasing pressure on Shein. </li>
<li>Yet, investors should be aware about Temu’s widening losses and the possible margin drag in the domestic eCommerce business due to the subsidy campaign launched by JD.</li>
<li>We revised our forecasts on Temu’s GMV/non-GAAP net loss in 2023 from USD 2bn/(1)bn to USD 5bn/(3)bn. We cut PDD’s TP to US$100.</li>
</ul>


We conducted interviews with Temu and Shein merchants. We expect Temu to be more aggressive in expansion. Most metrics of Temu are improving, and it creates increasing pressure on Shein. 
Yet, investors should be aware about Temu’s widening losses and the possible margin drag in the domestic eCommerce business due to the subsidy campaign launched by JD.
We revised our forecasts on Temu’s GMV/non-GAAP net loss in 2023 from USD 2bn/(1)bn to USD 5bn/(3)bn. We cut PDD’s TP to US$100.


[Pinduoduo (PDD US) Target Price Change]: Cut TP for Higher Losses from Temu