Meituan 3690

[winston]

not vested

Meituan (3690 HK)
Macro And COVID-19 Uncertainties Remain, Prudent Spending Ahead

Meituan has been trading sideways since early-22 due to a lack of near-term
catalysts.

Although its core business will remain profitable, we suggest investors take a
wait-and see approach at this juncture given the subdued 4Q21 guidance from management, and not to forget the divestment risk from Tencent (although the negative impact from the news has subsided recently).

Maintain HOLD with a higher target price of HK$207.00.

Source: UOBKH

https://research.uobkayhian.com/content ... bc75083be9

[winston]

NDRC Guides Internet Platforms, like Takeaway Service Providers, to Cut Fees for Caterers

China's National Development and Reform Commission (NDRC), Ministry of Finance (MOF), People's Bank of China (PBOC) and State Administration for Market Regulation (SAMR) jointly published a notice, regarding certain policies on promoting the recovery and development of embattled industries in the service industry.

The Commission guided internet platforms in China, such as takeaway service providers, to lower the service fee standards for caterers further, so as to reduce the operating costs of related caterers.

NDRC also encouraged F&B operators to provide free and regular Covid testings for outreach staff and subsidize anti-epidemic and disinfection service charges.

The notice also specified that small and micro service providers and individual industrial and commercial households in the county-level administrative regions which are epidemic medium and high-risk areas, can have rentals exempted for 6 months this year, and other areas will have 3-month rental concessions.

Source: AAStocks Financial News

[winston]

vested

Chinese directive asking on-demand platforms to lower merchant fees triggers sell off in Meituan shares in Hong Kong

The new guidelines, published by the National Development and Reform Commission, are aimed at helping the service sector recover from the impact of the pandemic
Chinese regulators have taken a tough stance on the country’s tech giants since last year

by Tracy Qu

To “further lower the service fee standards for catering businesses to help them reduce costs” and give “preferential service fees to catering companies in county-level administrative regions where middle and high-risk areas are located”.

Source: SCMP

https://www.scmp.com/tech/policy/articl ... 79a9712c6d

[winston]

vested

China wipes US$26 billion off Meituan’s value with new fee policy

Meituan shares have lost nearly 60% in the past 12 months.

Source: Bloomberg

https://www.theedgemarkets.com/article/ ... fee-policy

[winston]

vested

Nomura Tends to Believe CN Govt to Let Food Delivery Platforms Decide How to Support Caterers

The Chinese government will likely not specifically require food delivery platforms to reduce service fees for restaurants, reported Nomura.

The broker, instead, viewed the favorable fee rates for catering merchants as temporary.

Nomura expressed that, ultimately, the impact of relevant policy on MEITUAN-W (03690.HK)'s profitability will depend on the extent in which the support would be financial-related, time span and the scale of regions to which it will be applied and the extent in which the financial-related costs would be passed on to its end customers.

UBS Projects MEITUAN-W (03690.HK) Near-term Shr Price at Around $170 with Support

The broker maintained the Buy rating for MEITUAN-W, with a target price of $336.

Source: AAStocks Financial News

[winston]

vested

UBS Projects MEITUAN-W (03690.HK) Near-term Shr Price at Around $170 with Support

14 Chinese ministries and regulators, including National Development and Reform Commission (NDRC), issued a document last Friday (18th) on assisting businesses and regions impacted by COVID-19 pandemic, in which online food delivery platforms were guided to further reduce service fees for restaurants, reported UBS.

UBS suggested that the investors have overreacted to the regulatory news and that their view on the regulatory impact on MEITUAN-W (03690.HK) was overly pessimistic throughout most of 2021.

The broker, instead, forecast that the impact from relevant adjustments in food delivery operation will be smaller than expected.

Related News: Nomura Tends to Believe CN Govt to Let Food Delivery Platforms Decide How to Support Caterers

Given the improving macro environment and policy support from the government, MEITUAN-W's YoY revenue growth is projected to accelerate again in 2Q and 3Q.

Anticipating near-term share price support to appear at around $170, the broker kept the target price of $320 for the stock, with its rating restated at Buy.

Source: AAStocks Financial News

[winston]

CITIC Securities Suggests Positive Take on Policy Impact on MEITUAN-W which Anchors High Quality Growth

MEITUAN-W's 4Q21 operating performance was predicted to be in line with the expectations, reported CITIC Securities.

With its business ecology aligned with the public's aspiration for a better living, the trajectory of value realization for MEITUAN-W's platform will not change, even despite the potential new regulations, the broker added.

Related News: JPM: MEITUAN-W (03690.HK) Shr Correction Offers Buying Opportunity, Rated Overweight

Expecting MEITUAN-W to post high-quality growth for its core businesses and improvement in earnings per order over this year, the broker advised the investors to perceive the policy impact rationally.

CITIC Securities maintained the Buy rating for MEITUAN-W, with a target price of $308.5.

Source: AAStocks Financial News

[winston]

vested

Meituan rose 3.1 percent after the state-run Economic Daily newspaper said the market had over-reacted to the government's guidance that food delivery platforms should lower service fees.

The policy was not intended to target the platform economy as the government recognizes its crucial role in the economy, the paper's commentary said.

Source: AP

[winston]

vested

Six measures to support SME merchants

Answering the recent government guidance to help the catering industry recover from the pandemic rebound, Meituan announced six measures to support small to medium-sized enterprises (SMEs).

We expect this round of merchant support measures to reduce the food delivery take rate by 0.3–0.5% pts and Meituan’s total revenue by 1–2%. We expect the measures to have a limited impact on Meituan’s performance.

Ele.me announced that it will invest Rmb20m in commission reductions and exemptions for merchants in the mid-to-high risk pandemic areas.

Reiterate Add for Meituan with an unchanged DCF-based TP of HK$300.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 00D3EC1EAC

[winston]

vested

Meituan Pilot-tests 'Service Star Rating' Incentive Scheme in 15 CN Cities

MEITUAN-W (03690.HK) -2.200 (-1.247%) revealed that it is currently pilot-testing a new "service star rating" incentive scheme in 15 Chinese cities including Shaoxing, Taiyuan and Kunming, under which delivery riders will receive score deductions as a result of negative reviews from customers and delayed delivery.

Riders' service quality will be assessed and rewarded based on their cumulative scores on a monthly basis.

MEITUAN-W added that the group will endeavor to establish a more comprehensive system to protect the rights of the riders and propel high-quality and healthy development of the delivery industry.

Related News: G Sachs: MEITUAN Launches 6 Measures to Back SMEs Responding to NDRC Guidelines; Buy Rating Restated

Source: AAStocks Financial News