Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Equity Bottom-Up

<ul>
<li>We expect BIDU to post C4Q24 top line,non-GAAP operating profit and GAAP net income (5.1%), (7.7%) and (8.7%) vs. consensus.We expect BIDU to issue C1Q25 top line guidance (1.2%) vs.consensus;</li>
<li>BIDU's problem is not only manifested in the loss of the Apple contract,it is also the loss of first mover advantage in both Generative Artificial Intelligence and Autonomous Driving Services. </li>
<li>Losing traffic advantage, BIDU has become a self-containing app ecosystem but all pillars of this ecosystem is facing intensifying competition. SELL @US$78.</li>
</ul>


We expect BIDU to post C4Q24 top line,non-GAAP operating profit and GAAP net income (5.1%), (7.7%) and (8.7%) vs. consensus.We expect BIDU to issue C1Q25 top line guidance (1.2%) vs.consensus;
BIDU's problem is not only manifested in the loss of the Apple contract,it is also the loss of first mover advantage in both Generative Artificial Intelligence and Autonomous Driving Services. 
Losing traffic advantage, BIDU has become a self-containing app ecosystem but all pillars of this ecosystem is facing intensifying competition. SELL @US$78.


[Baidu, Inc. (BIDU US, SELL, TP US$78) Preview]: Baidu’s Problem Is Deep Rooted and Getting Worse

Research from Water Tower Research, Water Tower Research

Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Thematic (Sector/Industry)

<ul><li>This month’s AI landscape reveals a market at an inflection point, with record infrastructure commitments colliding with growing bubble anxiety. </li><li>Meta’s staggering $600-billion US buildout plan and Anthropic’s $50-billion data center announcements underscore that the compute arms race is accelerating, not cooling.</li><li>Yet caution signals are flashing, as CoreWeave trimmed its full-year guidance despite strong 3Q results, while Nvidia, CoreWeave, and Nebius Group all saw pressure on their stocks. </li></ul>

This month’s AI landscape reveals a market at an inflection point, with record infrastructure commitments colliding with growing bubble anxiety. Meta’s staggering $600-billion US buildout plan and Anthropic’s $50-billion data center announcements underscore that the compute arms race is accelerating, not cooling.Yet caution signals are flashing, as CoreWeave trimmed its full-year guidance despite strong 3Q results, while Nvidia, CoreWeave, and Nebius Group all saw pressure on their stocks. 

AI Flow Newsletter : Monitoring The "Currents" Of AI

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>For 4Q24E, we are looking for 4.8% YoY decline in total revenue (1% lower than consensus), and RMB4.7bn non-GAAP net income for Baidu, owing to one-off impact from equity investee.</li><li>Cloud revenue growth likely remains a bright spot aided by strong demand in GPU cloud, while pace of ads rev growth recovery remains a key to watch.</li><li>We lowered our SOTP-based target price by 6% to US$144.6 to factor in more tepid-than-expected ads business recovery. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

For 4Q24E, we are looking for 4.8% YoY decline in total revenue (1% lower than consensus), and RMB4.7bn non-GAAP net income for Baidu, owing to one-off impact from equity investee.Cloud revenue growth likely remains a bright spot aided by strong demand in GPU cloud, while pace of ads rev growth recovery remains a key to watch.We lowered our SOTP-based target price by 6% to US$144.6 to factor in more tepid-than-expected ads business recovery. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Baidu (BIDU US) - Solid Cloud Revenue Growth a Bright Spot in the Stage of Business Adjustment

Equity Research Analyst - Long-Short

Raj S, CA, CFA

<ul>
<li>Policy clarity and domestic GPU shift remove key overhangs; China’s AI build-out proceeding under self-reliance base case.</li>
<li>AI token usage doubling every 3–6 months makes hyperscaler capex upgrades inevitable over the coming quarters - a key catalyst driving order wins.</li>
<li>VNET’s 400 MW annual additions and REIT monetisation support 25–30% EBITDA CAGR per consensus; re-rating to 13-15x EV/ EBITDA from current 11x EV/EBITDA implies potential of 90% upside.</li>
</ul>


Policy clarity and domestic GPU shift remove key overhangs; China’s AI build-out proceeding under self-reliance base case.
AI token usage doubling every 3–6 months makes hyperscaler capex upgrades inevitable over the coming quarters - a key catalyst driving order wins.
VNET’s 400 MW annual additions and REIT monetisation support 25–30% EBITDA CAGR per consensus; re-rating to 13-15x EV/ EBITDA from current 11x EV/EBITDA implies potential of 90% upside.


VNET Group (VNET US) - Re-Rating On: Clarity on Chips, Geopolitics, and Hyperscaler Capex

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.

<ul>
<li>NEV retail volume increased by 51% YoY in November and 41% YoY for first eleven months.</li>
<li>Jiyue Auto, as a car maker subsidiary of Baidu, is dismissing employees.</li>
<li>Hisense, a home appliance producer, lays off 30,000 employees of its total 110,000.</li>
</ul>


NEV retail volume increased by 51% YoY in November and 41% YoY for first eleven months.
Jiyue Auto, as a car maker subsidiary of Baidu, is dismissing employees.
Hisense, a home appliance producer, lays off 30,000 employees of its total 110,000.


China Consumption Weekly (16 Dec 2024): NEV Industry Nov., Baidu, Hisense, Boss Zhipin,

China

Baidu, Inc. operates an Internet search engine. The Company offers algorithmic search, enterprise search, news, MP3, and image searches, voice assistance, online storage, and navigation services. Baidu serves clients globally.

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Baidu (BIDU US)

[Baidu, Inc. (BIDU US, SELL, TP US$78) Preview]: Baidu’s Problem Is Deep Rooted and Getting Worse

BIDU faces challenges with loss of Apple contract and first mover advantage in AI and autonomous driving, leading to intensifying competition and...

Blue Lotus Research Institute

Baidu (BIDU US) - Solid Cloud Revenue Growth a Bright Spot in the Stage of Business Adjustment

For 4Q24E, we are looking for 4.8% YoY decline in total revenue (1% lower than consensus), and RMB4.7bn non-GAAP net income for Baidu, owing to one...

CMB International

VNET Group (VNET US) - Re-Rating On: Clarity on Chips, Geopolitics, and Hyperscaler Capex

China's AI gains momentum with policy clarity and domestic GPU shift, driving potential 90% upside for VNET with 25-30% EBITDA CAGR as hyperscaler...

Raj S, CA, CFA

China Consumption Weekly (16 Dec 2024): NEV Industry Nov., Baidu, Hisense, Boss Zhipin,

NEV retail volume increased by 51% YoY in November. Jiyue Auto, as a subsidiary of Baidu, is dismissing employees. Hisense, a home appliance...

Ming Lu

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Baidu, Inc. (BIDU US, SELL, TP US$78) Preview]: Baidu’s Problem Is Deep Rooted and Getting Worse

​BIDU faces challenges with loss of Apple contract and first mover advantage in AI and autonomous driving, leading to intensifying competition and...

Blue Lotus Research Institute

AI Flow Newsletter : Monitoring The "Currents" Of AI

This month’s AI landscape reveals a market at an inflection point, with record infrastructure commitments colliding with growing bubble anxiety.

Water Tower Research

Baidu (BIDU US) - Solid Cloud Revenue Growth a Bright Spot in the Stage of Business Adjustment

For 4Q24E, we are looking for 4.8% YoY decline in total revenue (1% lower than consensus), and RMB4.7bn non-GAAP net income for Baidu, owing to one...

CMB International

VNET Group (VNET US) - Re-Rating On: Clarity on Chips, Geopolitics, and Hyperscaler Capex

​China's AI gains momentum with policy clarity and domestic GPU shift, driving potential 90% upside for VNET with 25-30% EBITDA CAGR as hyperscaler...

Raj S, CA, CFA

China Consumption Weekly (16 Dec 2024): NEV Industry Nov., Baidu, Hisense, Boss Zhipin,

NEV retail volume increased by 51% YoY in November. Jiyue Auto, as a subsidiary of Baidu, is dismissing employees. Hisense, a home appliance...

Ming Lu

BIDU faces challenges with loss of Apple contract and first mover advantage in AI and autonomous driving, leading to intensifying competition and...

China's AI gains momentum with policy clarity and domestic GPU shift, driving potential 90% upside for VNET with 25-30% EBITDA CAGR as hyperscaler...