Meituan 3690

[winston]

not vested

Meituan
Strong results but continued heavy investment

Meituan reported 2Q21 revenue of Rmb44bn, up 77% yoy, and an adjusted net loss of
Rmb2.2bn, compared to net profit in 2Q20, both above our expectations.

We expect 3Q21F top-line growth of 39% yoy and an operating loss of Rmb6.5bn.

Meituan will start to pay injury insurance for its delivery riders next year, which may
increase delivery costs by Rmb0.05/order.

Social benefits payments for riders will take more time resolve.

Reiterate Add with a DCF-based TP of HK$299.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 6E4BE9C550

[winston]

not vested

Meituan (3690 HK): E-grocery business holds good potential [BUY, TP: HK$338.00]

Adjusted net loss of Rmb2,217m in 2Q21 vs. market expectations of c.Rmb4bn loss

Revenue grew by 77% y-o-y to Rmb43,759m, slightly ahead of market expectations

Operating margin of food delivery and in-store, hotel & travel segments continue to improve

Maintain BUY with a lower TP of HK$338

Source: DBS

[winston]

not vested

M Stanley Cites MEITUAN-W: Regulatory Probe Result May Come in 1-2 Mths; To Lift Monetization Rate in 3 Areas

Morgan Stanley maintained MEITUAN-W (03690.HK) 's Overweight rating and target of $300.

MEITUAN-W's management has not received SAMR's official antitrust probe update, expecting results to come in a month or two, cited by the broker.

Nomura Trims MEITUAN-W (03690.HK) TP to $285; 3Q Growth May Decelerate

MEITUAN-W has three potential areas to boost its monetization rate, namely lower user subsidy ratio, a 0.5% rise in advertising monetization, and a tiered pricing mechanism leading to overall order structure change and higher blended delivery service fee from consumers, according to the management.

Source: AAStocks Financial News

[winston]

vested

Meituan players cash in shares

by Aiden He

Meituan's non-executive director Neil Shen Nanpeng, who is also the founding and managing partner of Sequoia Capital China, sold off 1.52 million Meituan shares last Tuesday at an average price of HK$259.68 in a deal that brought in HK$395 million.

On Wednesday, he sold off another 100,000 Meituan shares for HK$26.5 million.

With the two share sales, Shen cashed in a total of about HK$422 million.

His stake in Meituan is now down to 5.79 percent.

News of the share sales came as mainland media reported that Meituan has been ordered by a Chinese court to immediately stop unfair competition behavior on the internet and compensate Alibaba-backed (9988) Ele.me for economic losses and expenses to the tune of one million yuan (HK$1.2 million).

Previously, the mainland food delivery giant had reportedly been sentenced to pay one million yuan and 352,000 yuan in two separate cases, for forcing shops to operate only on its platform and penalized those who refused to abide by its guidelines.

Source: The Standard

https://www.thestandard.com.hk/section- ... -in-shares

[winston]

vested

Macquarie: Bearish on MEITUAN-W Profit Outlook; Price May Rangebound with High Volatility Next 12 Mths

Despite MEITUAN-W (03690.HK)'s online penetration and market share expansion, Macquarie believed the market had underestimated the complexity and investment needed to develop fresh-related businesses, adding the community group buying unit may remain loss-making by 2024.

The broker was bearish on MEITUAN-W's profit outlook given a multi-year investment cycle for fresh food initiatives, thus expecting the stock to rangebound with sharp volatility next 12 months.

The stock was restated Neutral at a $244 target.

Related News: Haitong Int'l Sees CN Dotcoms Not Yet Bottom out, More Regulatory Policy in Next 2-3 Quarters

Source: AAStocks Financial News

[winston]

not vested

China fines Meituan less-than-expected US$530 million for monopolistic behaviour, ending five-month antitrust probe

The ‘pick one from two’ tactic, where merchants are forced to choose only one platform as their distribution channel, has been widespread in China

Meituan, founded by the 42-year-old billionaire Wang Xing, was previously urged to improve its working conditions

by Tracy Qu and Minghe Hu

The fine was equivalent to about 3 per cent of Meituan’s total domestic revenue of 114.7 billion yuan last year,

The market regulator also ordered Meituan to refund exclusive cooperation deposits paid by merchants, totalling 1.29 billion yuan.

In July, SAMR and six other government agencies ordered Meituan to pay its delivery riders more than the country’s minimum wage, and to free them from unreasonable demands made by algorithms that predetermined the number and timing of their deliveries.

The company must also provide its workers with social security and allow them to join a union.

In June, Wang donated US$2.3 billion, about a tenth of his total shareholding in the company, to his own philanthropic foundation that promotes education and scientific research.

Source: SCMP

https://www.scmp.com/tech/big-tech/arti ... e95c4f4f13

[winston]

not vested

Meituan (3690 HK)
Finalising SAMR’s Penalty; Outlook Remains Choppy On Soft 3Q21 Guidance
And Further Regulations

The SAMR has imposed fines of Rmb3.4b on Meituan after the regulator launched an
investigation into the company in April on an alleged 2-choose-1 practice.

Although the fines came in below the market’s expectation, its US-listed ADR (MPNGY US) only rose 1.6% when the US market closed on Friday which implies the impact had been previously priced in.

Maintain HOLD. Target price: HK$242.00.

Source: UOBKH

https://research.uobkayhian.com/content ... 9d7d47b18e

[winston]

not vested

Positive results in the anti-trust investigation

Meituan will be fined Rmb3.442bn to conclude its anti-trust investigation by the by SAMR since Apr 2021, which is equivalent to 3% of FY20 total revenue.

Longer-term margin improvement is expected to come from delivery efficiency improvement from increasing order density, autonomous delivery and lower subsidies.

During the National Day holidays, Meituan saw total GMV rise 29.5% yoy and 51.6% compared with the same period in 2019.

TP: HK$299

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 2637E477A1

[winston]

not vested

Meituan (3690 HK) - More green light than red light

On 8 Oct 2021, the State Administration for Market Regulation (SAMR) announced the completion of its anti-trust investigation into Meituan.

The SAMR concluded that Meituan has been in violation of China’s Anti-Monopoly law for forced exclusivity, and has thus imposed a fine of RMB3.442b, which represents 3% of Meituan’s FY20 domestic sales and ordered Meituan to return RMB1.29b of exclusivity deposits in full to its partners and cease forced exclusivity arrangements with merchants.

Also, among other things, Meituan is also required to improve the platform commission fee mechanism and algorithm rules and protect the legitimate interests of SME merchants and riders.

We view the above mentioned developments positively. In terms of the quantum of the fine, we note that this is significantly below the USD1b amount that was previously quoted in the media, and comes as a smaller proportion of domestic sales vs. that of Alibaba’s.

Also, the main areas of rectification are broadly within expectations without any significant negative surprise.

Taken together, we believe the conclusion of the regulatory probe is likely to thus help lift one of the key overhang on the stock.

Separately, despite domestic tourism showing a weaker recovery during Golden Week compared to other recent holidays earlier this year, Meituan reported robust operating trends with 29.5% YoY growth in overall platform GTV (or +52% vs. 2019).

All considered, we see reasons to remain constructive on the name, and reiterate Meituan as one of our preferred sector picks (see China Internet – Incremental positives, dated 23 Sep 2021); we maintain our FV of HKD316 on the name for now. BUY.

Source: OCBC

[winston]

not vested

Meituan (3690 HK)
Solidifying Footprint In CGP Market; Strong Growth In Food Delivery Order Volume

Meituan had rallied 6% following the announcement of the anti-trust fine.

We expect the company to deliver revenue growth of 44% in 3Q21, driven by resilient performance from the food delivery segment (albeit at a slower rate due to the resurgence of COVID19 cases and challenging weather conditions) and continued strong growth momentum from the New Initiatives segment, offset by the subdued performance from the ISHT segment which dragged its overall top-line growth.

We maintain HOLD with a higher target price of HK$278.00.

https://research.uobkayhian.com/content ... 05b422c0ea