Sea Ltd SE (former Garena)

[winston]

not vested

2Q24F: Solid performance across segments

We estimate SE’s 2Q24F adj. EBITDA at US$423m (+5% qoq), led by Shopee’s narrowing of losses and SeaMoney’s continued growth.

We see room for Shopee to raise its FY24F GMV growth guidance from current “high-teens yoy”, post strong 1H24F GMV performance (+31% yoy).

ASEAN e-commerce competitive landscape remains healthy with players further raising commission rates, albeit pockets of increased spending. Add.

Target: US$88

Source: CIMB

https://rfs.cgsi.com/api/download?file= ... 3EE62CD0C9

[winston]

More fee hikes in 3Q24F

ASEAN e-commerce players have stepped up fee adjustments across markets in 3Q24, reflecting a stabilised competitive landscape, in our view.

Shopee raised commissions in Thailand, Philippines and Malaysia for the second time YTD in Jul/Aug; it is also raising rates in Indonesia in Sep.

We expect Shopee to raise FY24F GMV guidance during 2Q24F results; our FY24F adj. EBITDA forecast for Shopee is above Bloomberg consensus.

TP: US$88

Source: CIMB

https://rfs.cgsi.com/api/download?file= ... 497260A4B6

[winston]

not vested

Sea's Shopee has raised the commissions it charges merchants in many core markets by about a third since the start of the year, underscoring the South-east Asia e-commerce leader’s renewed attempt of boosting its bottom line.

The moves, which have not previously been reported, reflect Sea’s growing confidence it can retain merchants in key markets, despite competition from TikTok, Temu and Lazada.

Its commission now exceeds its rivals.

Source: Phillips

[winston]

not vested

SEA (SE US) 2Q24: Strong Quarter, Improving Outlook And Better Profit Profile

SEA’s 2Q24 results are in line with our expectations as all business segments saw better sequential earnings.

This was on the back of:
a) better profitability from nonAsian markets and higher take-rates for the e-commerce segment,
b) strong growth momentum from the DFS segment, and
c) increased bookings from a highly engaged user base for the group’s Free Fire game.

Given the group’s improving outlook, we maintain BUY with a higher target price of US$88.21.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

not vested

Sea Ltd (SE US) 2Q24: Strong beat; raise TP/earnings

Firing on multiple cylinders; guidance revised up GAAP 2Q revenues grew 23% YoY/2% QoQ and came 5% ahead of MIBG and 3% ahead of street.

Adj. EBITDA declined 12% YoY but increased 12% QoQ and came 13% ahead of street expectations.

All the operating segment revenues and Adj. EBITDA came ahead of expectations, except for financial services revenues which came 1-2% below.

Shopee GMV increased 29% YoY but declined 1% QoQ due to seasonality. This was 7%/3% ahead of MIBG/street.

Garena bookings increased 21% YoY/5% QoQ and came 6-7% ahead of MIBG/street est.

Shopee GMV guidance revised up to mid-20% YoY growth in 2024 (from high teens).

TP: US$96

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/398736.pdf

[winston]

not vested

Rational competition drives bullish GMV guidance

2Q24 adj EBITDA of USD449m was 7% ahead of consensus due to strong contribution from gaming & fintech

Mid-20s GMV growth guidance for 2024 eases slower growth concerns from higher take rates;

We raise our group adj EBITDA by 23%/21% in FY24F/25F

SE has corrected slightly since our downgrade on 28 June; Upgrade to BUY with a revised TP of USD99 (prev. USD75) on stronger e-commerce & gaming prospects

Source: DBS

https://www.dbs.com/insightsdirect/comp ... ecid=20685

[winston]

not vested

Sea Limited (SE US)
Recommendation : BUY
Fair Value : USD 98.00

Recovering market sentiment.

• Sea Limited’s share price has climbed 21.1% since its 2Q24 results announcement prior to market open on 13 Aug 2024

• Much of the positivity, in our view, stems from an upward revision in management’s guidance, as well as a more benign than expected competitive outlook for Shopee

• Strong growth and improved profitability across all three businesses; revise fair value (FV) estimate from USD90 to USD98

Sea Limited (Sea) is a leading global consumer internet company founded in Singapore, operating three core businesses across digital entertainment (Garena), e-commerce (Shopee), as well as digital payments and financial services (SeaMoney).

In 2023, the company guided on a realignment of strategy to increase investments into Shopee and grow its market share, which may lead to losses from time to time.

With the company’s businesses enjoying strong potential in a growing region, we believe that the management is repositioning the company to tap on further growth going forward, which is the right strategy in the long term.

In the near term, however, we think investors need to be patient with this stock as it undergoes a reset of investor expectations regarding the change in business strategy.

Source: OCBC

[winston]

not vested

Signs of less intense e-commerce competition

Shopee and TikTok Shop are likely to raise seller commission fee, in Sep 2024 in Indonesia.

This is a positive development in Indonesia where ecommerce had been more intense than rest of the region.

Reiterate our BUY call on SE with USD99 TP; Shopee expects to achieve adj EBITDA
breakeven in 3Q24F coupled with strong growth in gross merchandise volume (GMV)

Source: DBS

https://www.dbs.com/insightsdirect/comp ... ecid=20989

[winston]

not vested

This Stock is Incredibly Cheap Right Now

by Anthony Di Pizio

During the second quarter of 2024 (ended June 30), Sea’s Shopee e-commerce platform processed a whopping 2.5 billion orders, which was a 40% increase from the year-ago period.

During Q2, Sea said more than 70% of orders across Asia were delivered within three days, with its cost per order declining by 8% compared to a year ago.

SeaMoney registered more than 4 million first-time borrowers, which was double the number it added in the same period last year. Overall, the platform had $3.5 billion worth of active loans at the end of June, which was up 40% year over year.

Free Fire had 648 million quarterly active users in Q2, marking the second consecutive quarter of growth after a post-pandemic slump. Unfortunately, average revenue per paying user fell to $10.20, which was the lowest level in a year.

With a strong cash position, accelerating revenue growth, and an attractive valuation, investors could do very well buying Sea Limited stock in September and holding it for the long term.

Source: The Motley Fool

https://tradesoftheday.com/2024/08/30/t ... e_vignette

[winston]

Free Fire is set to return to India in Sep 2024

Free Fire is expected to come back in India in Sep 2024 after its ban in Feb 2022, final touches on the server infrastructure and localisation efforts likely still ongoing

Free Fire India earlier contributed 10% to the group’s Gaming revenue and the relaunch could offer more growth visibility over the next 2-3 years

Maintain BUY for SE with an unchanged TP of USD99

Source: DBS

https://www.dbs.com/insightsdirect/comp ... ecid=21139