Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Bottom-Up

<ul>
<li>In 3Q24, PDD released strong revenue growth, but a flat margin.</li>
<li>We believe, in 2025, PDD will continue to focus on growth rather than profit.</li>
<li>We conclude an upside of 43% and a price target of US$167 for 2025. Buy.</li>
</ul>


In 3Q24, PDD released strong revenue growth, but a flat margin.
We believe, in 2025, PDD will continue to focus on growth rather than profit.
We conclude an upside of 43% and a price target of US$167 for 2025. Buy.


PDD (PDD US): 3Q24, Focuses on Growth, But Not Profit Margin

Greater China Equity Long/Short Analyst

Eric Chen

<ul>
<li>We compared similar growth stage of Alibaba to Pinduoduo, when GMV of both platforms increase from RMB1 trillion to RMB4 trillion, to facilitate better understanding of efficiency edge of Pinduoduo.</li>
<li>Contrary to consensus, Pinduoduo didn’t do better than Alibaba on OPEX (advertising expenditure in particular), but it did extract much greater value from the ecosystem via significantly higher take-rate.</li>
<li>The findings highlight how Pinduoduo aggregate user traffic at surprisingly high cost to beef up merchant competition in terms of cost optimization and user acquisition, with Pinduoduo  reaping greatest value.</li>
</ul>


We compared similar growth stage of Alibaba to Pinduoduo, when GMV of both platforms increase from RMB1 trillion to RMB4 trillion, to facilitate better understanding of efficiency edge of Pinduoduo.
Contrary to consensus, Pinduoduo didn’t do better than Alibaba on OPEX (advertising expenditure in particular), but it did extract much greater value from the ecosystem via significantly higher take-rate.
The findings highlight how Pinduoduo aggregate user traffic at surprisingly high cost to beef up merchant competition in terms of cost optimization and user acquisition, with Pinduoduo  reaping greatest value.


<ul>
<li>Temu as a subsidiary of PDD becomes the second largest global e-commerce website.</li>
<li>Meituan merges departments into fewer business units to cut expenses further.</li>
<li>Mercedes-Benz left the joint venture with BYD, as its high end products are not as popular as Tesla models.</li>
</ul>


Temu as a subsidiary of PDD becomes the second largest global e-commerce website.
Meituan merges departments into fewer business units to cut expenses further.
Mercedes-Benz left the joint venture with BYD, as its high end products are not as popular as Tesla models.


China Consumption Weekly (30 Sep 2024): PDD, Meituan, BYD, Benz, Miniso, Yonghui

Equity Analyst, Investory

Devi Subhakesan

Equity Analyst

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

<ul>
<li>Welcome to Consumer Tales &amp; Trends, your weekly roundup of the latest corporate developments, investment reports and sector events in the consumer industry.</li>
<li>Temu, (owned by <a href="https://www.smartkarma.com/entities/pdd-holdings-inc" target="_blank" data-smartkarma-citation="entities:27250:1" rel="noopener">PDD US)</a>, and Shein might need to rethink their US strategies if a new rule stops overseas shipments of tariffed products from bypassing US customs duty.</li>
<li>Singapore passed a groundbreaking law last week to protect gig workers. Other countries may follow suit and this could adversely impact margins. Take note: <a href="https://www.smartkarma.com/entities/meituan" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a> , <a href="https://www.smartkarma.com/entities/zomato-ltd" target="_blank" data-smartkarma-citation="entities:28820:1" rel="noopener">Zomato (ZOMATO IN)</a>
</li>
</ul>


Welcome to Consumer Tales &amp; Trends, your weekly roundup of the latest corporate developments, investment reports and sector events in the consumer industry.
Temu, (owned by PDD US), and Shein might need to rethink their US strategies if a new rule stops overseas shipments of tariffed products from bypassing US customs duty.
Singapore passed a groundbreaking law last week to protect gig workers. Other countries may follow suit and this could adversely impact margins. Take note: Meituan (3690 HK) , Zomato (ZOMATO IN)



Weekly Consumer Tales: Cross Border Comm Crisis-Midea Upsized-LG Elecs' Upside-Platform Workers Law

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>PDD Holdings, Inc. has shared their financial results for the second quarter of 2024 along with an overview of strategic actions and challenges.</li><li>The company saw substantial revenue growth, with total revenue reaching RMB 97 billion, marking an 86% year-on-year increase.</li><li>This significant growth stems mainly from robust online marketing and transaction services.</li></ul>

PDD Holdings, Inc. has shared their financial results for the second quarter of 2024 along with an overview of strategic actions and challenges.The company saw substantial revenue growth, with total revenue reaching RMB 97 billion, marking an 86% year-on-year increase.This significant growth stems mainly from robust online marketing and transaction services.

PDD Holdings Inc.: How Are They Managing Competition and Consumer Demand? - Major Drivers

China

PDD Holdings Inc. is a multinational commerce group that owns and operates a portfolio of businesses. The Company focuses on digital economy so that local communities and small businesses can benefit from the increased productivity and new opportunities. PDD Holdings has built a network of sourcing, logistics, and fulfillment capabilities for its underlying businesses.

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PDD Holdings (PDD US)

PDD (PDD US): 3Q24, Focuses on Growth, But Not Profit Margin

In 3Q24, PDD released strong revenue growth, but a flat margin. We believe, in 2025, PDD will continue to focus on growth more than profit margin....

Ming Lu

Pinduoduo: Behind Its Efficiency Edge

Comparison between Alibaba and Pinduoduo at similar growth stages reveals Pinduoduo's efficiency edge through higher take-rate despite higher...

Eric Chen

China Consumption Weekly (30 Sep 2024): PDD, Meituan, BYD, Benz, Miniso, Yonghui

Temu becomes the second largest global e-commerce website. Meituan merges departments to cut expenses. Mercedes-Benz left the joint venture with...

Ming Lu

Weekly Consumer Tales: Cross Border Comm Crisis-Midea Upsized-LG Elecs' Upside-Platform Workers Law

PDD owned Temu's US cross border business model could get upended if proposed rule to block products subject to US import tariffs from availing...

Devi Subhakesan

PDD Holdings Inc.: How Are They Managing Competition and Consumer Demand? - Major Drivers

PDD Holdings, Inc. has shared their financial results for the second quarter of 2024 along with an overview of strategic actions and...

Baptista Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

PDD (PDD US): 3Q24, Focuses on Growth, But Not Profit Margin

In 3Q24, PDD released strong revenue growth, but a flat margin. We believe, in 2025, PDD will continue to focus on growth more than profit margin....

Ming Lu

Pinduoduo: Behind Its Efficiency Edge

​Comparison between Alibaba and Pinduoduo at similar growth stages reveals Pinduoduo's efficiency edge through higher take-rate despite higher...

Eric Chen

China Consumption Weekly (30 Sep 2024): PDD, Meituan, BYD, Benz, Miniso, Yonghui

Temu becomes the second largest global e-commerce website. Meituan merges departments to cut expenses. Mercedes-Benz left the joint venture with...

Ming Lu

Weekly Consumer Tales: Cross Border Comm Crisis-Midea Upsized-LG Elecs' Upside-Platform Workers Law

PDD owned Temu's US cross border business model could get upended if proposed rule to block products subject to US import tariffs from availing...

Devi Subhakesan

PDD Holdings Inc.: How Are They Managing Competition and Consumer Demand? - Major Drivers

PDD Holdings, Inc. has shared their financial results for the second quarter of 2024 along with an overview of strategic actions and...

Baptista Research

Comparison between Alibaba and Pinduoduo at similar growth stages reveals Pinduoduo's efficiency edge through higher take-rate despite higher...