【行业研究报告】美团-W-Determined to maintain local consumer services industry consumer mind share

29May202329May2023CMBInternationalGlobalMarkets|EquityResearch|CompanyUpdateMeituan(3690HK)DeterminedtomaintainlocalconsumerservicesindustryconsumermindshareMeituanreported(25May)its1Q23results:revenuewasRMB58.6bn,up26.7%YoY,3/2%higherthanourforecast/consensusestimate.Adjustednetprofitduring1Q23reachedRMB5.5bn,betterthanour/consensusforecastofRMB2.0/1.9bn,duetobetter-than-expectedoperatingprofitgeneratedfromcorelocalcommercebusinessaidedbybetteroperatingleverageimprovement,andmorestringentthanexpectedcostcontrolfromnewinitiatives.MeituanremainsdeterminedtoinvestindrivingforbetterconsumermindshareandmerchantsROIinlocalconsumerservicesindustry,inordertofendoffescalatingcompetitionfromDouyin.WeexpectGTVsharewillbekeyevaluationmetricsforassessingMeituan’scompetitivestrategyresults.WeliftourDCF-basedTPtoHK$172.0toaccountforbetter-than-expectedUEexpansionoffooddelivery(FD)business.MaintainBUY.Remainsdeterminedtomaintainmarketshareinlocalconsumerservicesindustry.Corelocalcommerce(CLC)segmentrevenue/OPwasRMB42.9/9.4bnin1Q23,up25.5/100.7%YoY.Itwas4/25%higherthanourestimate,thanksto:1)better-than-expecteduniteconomics(UE)expansionoffooddeliverybusiness;2)better-than-expectedOPMforin-storehotelandtravel(ISHT)businessaidedbystrongmarginexpansionofhotelbusiness,andlessthanexpectedspendingtodriveforconsumermindsharegainandmerchantROIimprovementin1Q23.WeexpectMeituantomaintainaggressiveinvestmentonISHTbusinesstosustainovertwothirdsofonlinelocallifeservicemarketshareuntilindustrycompetitionshowsamarginaleasingtrend.WeforecastMeituan’sISHTbusinessGMV/revenuetogrow100/58%YoYonlowbaseandaggressiveinvestment,andtoink30%OPMin2Q23E.UEexpansionoffooddeliverybusinessbetterthanexpectationin1Q23.WeestimateMeituan’sFDbusinesswithinCLCsegmenthasachievedperorderoperatingprofitofRMB1.3in1Q23,upfromRMB0.5in1Q22,andbetterthanourestimateatRMB1.0,thanksto:1)declineinperorderridercostaidedbymoreabundantridersupply;2)moreoptimizedusersubsidyspend;and3)increaseinrevenuecontributionfromonlinemarketingservices.For2Q23E,weforecastFDrevenuegrowthof30%YoY,drivenby30%YoYgrowthinordervolume,andperorderOPofRMB1.3,flatYoY,whichcouldbedrivenbytheincreaseinmonetizationfromonlinemarketingservices,butoffsetbythedecreaseinaverageordervalue,asbusinessoperationofSMEsonMeituan’sFDplatformhascomebacktonormal.TargetPriceHK$172.00(PreviousTPHK$168.00)Up/Downside36.5%CurrentPriceHK$126.00ChinaInternetSaiyiHE,CFA(852)39161739hesaiyi@cmbi.com.hkYeTAOfranktao@cmbi.com.hkWentaoLU,CFAluwentao@cmbi.com.hkStockDataMktCap(HK$mn)775,731.0Avg3mthst/o(HK$mn)3,858.352wHigh/Low(HK$)208.20/120.60TotalIssuedShares(mn)6156.6Source:FactSetShareholdingStructureHuaiRiverInvestmentLimited10.1%CrownHoldingsAsiaLimited7.9%Source:HKExSharePerformanceAbsoluteRelative1-mth-4.3%0.2%3-mth-6.3%0.1%6-mth-7.8%-13.5%Source:FactSet12-mthPricePerformanceSource:FactSetEarningsSummary(YE31Dec)FY21AFY22AFY23EFY24EFY25ERevenue(RMBmn)179,128219,955273,943336,874403,392YoYgrowth(%)56.022.824.523.019.7Netprofit(RMBmn)(23,538.2)(6,686.1)10,246.626,792.740,660.0Adjustednetprofit(RMBmn)(15,571.5)2,827.218,193.334,677.148,798.6EPS(Adjusted)(RMB)(2.54)0.462.935.527.69ConsensusEPS(RMB)na0.462.264.337.25P/E(x)nana69.026.617.7ROE(%)(21.1)(5.3)7.717.320.7Source:Companydata,Bloomberg,CMBIGMestimates