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>Baidu reported revenue/non-GAAP operating profit/GAAP net income inline/7.72%/66.1% vs. our estimation.</li>
<li>We believe short term cyclical and medium term AIGC-led upswing in advertising can bridge Baidu’s long-term business, which we do see them difficult to monetize.</li>
<li>We maintain a BUY rating and adjusted TP to US$157, implying a 14.6x PE. It is currently trading at 11.4x PE in 2024.</li>
</ul>


Baidu reported revenue/non-GAAP operating profit/GAAP net income inline/7.72%/66.1% vs. our estimation.
We believe short term cyclical and medium term AIGC-led upswing in advertising can bridge Baidu’s long-term business, which we do see them difficult to monetize.
We maintain a BUY rating and adjusted TP to US$157, implying a 14.6x PE. It is currently trading at 11.4x PE in 2024.


[Baidu, Inc. (BIDU US, BUY, TP US$157) TP Change]: C4Q/2024 Ads Upswing Bridge Gap to the Future

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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.

Event-Driven

<ul>
<li>PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US listed China companies.</li>
<li>The Hong Kong visit was on the back of the 26th Aug 2022 announcement by PCAOB and CSRC that they had entered into an agreement with US authorities for access.</li>
<li>In this note, we'll talk about the latest developments, possible outcomes and implications.</li>
</ul>


PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US listed China companies.
The Hong Kong visit was on the back of the 26th Aug 2022 announcement by PCAOB and CSRC that they had entered into an agreement with US authorities for access.
In this note, we'll talk about the latest developments, possible outcomes and implications.


China ADRs Delisting - Friday Could Be Judgment Day for over US$800bn Mcap of Stocks

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

KraneShares CSI China Internet ETF / Event-Driven

<ul>
<li>The PCAOB has not, despite a cooperation agreement with the CSRC signed in 2013, been able to conduct on-site investigations of a HK or mainland-based company since 2010.</li>
<li>On Friday, the CSRC published a new Strengthening Confidentiality and File Management Related to Overseas Issuance to replace 2009 rules. </li>
<li>Importantly, the revised Provisions deletes the stipulation that “on-site inspections shall be dominated by domestic regulators or depend on the conclusions of inspections by domestic regulators.” Will it be enough?</li>
</ul>


The PCAOB has not, despite a cooperation agreement with the CSRC signed in 2013, been able to conduct on-site investigations of a HK or mainland-based company since 2010.
On Friday, the CSRC published a new Strengthening Confidentiality and File Management Related to Overseas Issuance to replace 2009 rules. 
Importantly, the revised Provisions deletes the stipulation that “on-site inspections shall be dominated by domestic regulators or depend on the conclusions of inspections by domestic regulators.” Will it be enough?


New CSRC "Provisions" Take a Step Towards Meeting PCAOB Requirements

Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

<ul>
<li>The key takeaway from this earning season on the topic of generative AI (GAI) is that in-house generated content has the greatest potential for cost savings;</li>
<li>Taking a step further, mid-sized video platforms can also use AI to skip the curator layer, similar to Pinduoduo using algorithm to bypass small merchants to connect directly to factories;</li>
<li>We also notice that general media platforms with ample advertising inventories tend to perform better with AI's help, which is why ads of Tencent's advertising performed better than Baidu's.</li>
</ul>


The key takeaway from this earning season on the topic of generative AI (GAI) is that in-house generated content has the greatest potential for cost savings;
Taking a step further, mid-sized video platforms can also use AI to skip the curator layer, similar to Pinduoduo using algorithm to bypass small merchants to connect directly to factories;
We also notice that general media platforms with ample advertising inventories tend to perform better with AI's help, which is why ads of Tencent's advertising performed better than Baidu's.


A Few Generative AI Takeaways From C1Q24 Earnings

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>Baidu delivered a positive result and managed an all-around beat last quarter, characterized by progress and expansion.</li><li>The focus on transformation through foundation models, particularly ERNIE and ERNIE bot, led to enhancements in products like Baidu Search and Baidu Wenku, resulting in increased user engagement and conversion rates.</li><li>Baidu's online marketing division harnessed generative AI to automate and enhance ad offerings, driving growth in online marketing revenue.</li></ul>

Baidu delivered a positive result and managed an all-around beat last quarter, characterized by progress and expansion.The focus on transformation through foundation models, particularly ERNIE and ERNIE bot, led to enhancements in products like Baidu Search and Baidu Wenku, resulting in increased user engagement and conversion rates.Baidu's online marketing division harnessed generative AI to automate and enhance ad offerings, driving growth in online marketing revenue.

Baidu Inc.: ERNIE Bot & Other Interesting AI Developments

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, BUY, TP US$157) TP Change]: C4Q/2024 Ads Upswing Bridge Gap to the Future

Baidu's financial results meet expectations, with potential for advertising growth to support long-term business. BUY rating maintained with...

Blue Lotus Research Institute

China ADRs Delisting - Friday Could Be Judgment Day for over US$800bn Mcap of Stocks

PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US...

Sumeet Singh

New CSRC "Provisions" Take a Step Towards Meeting PCAOB Requirements

CSRC has published new Provisions putting the onus of info management on companies, making it easier for the PCAOB to conduct on-site audits. It...

Travis Lundy

A Few Generative AI Takeaways From C1Q24 Earnings

C1Q24 generative AI has made explicit impact on listco earnings. We summarized the observed trends and found China has a great deal of potential to...

Blue Lotus Research Institute

Baidu Inc.: ERNIE Bot & Other Interesting AI Developments

Baidu delivered a positive result and managed an all-around beat last quarter, characterized by progress and expansion. The focus on...

Baptista Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Baidu, Inc. (BIDU US, BUY, TP US$157) TP Change]: C4Q/2024 Ads Upswing Bridge Gap to the Future

​Baidu's financial results meet expectations, with potential for advertising growth to support long-term business. BUY rating maintained with...

Blue Lotus Research Institute

China ADRs Delisting - Friday Could Be Judgment Day for over US$800bn Mcap of Stocks

PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US...

Sumeet Singh

New CSRC "Provisions" Take a Step Towards Meeting PCAOB Requirements

CSRC has published new Provisions putting the onus of info management on companies, making it easier for the PCAOB to conduct on-site audits. It...

Travis Lundy

A Few Generative AI Takeaways From C1Q24 Earnings

C1Q24 generative AI has made explicit impact on listco earnings. We summarized the observed trends and found China has a great deal of potential to...

Blue Lotus Research Institute

Baidu Inc.: ERNIE Bot & Other Interesting AI Developments

Baidu delivered a positive result and managed an all-around beat last quarter, characterized by progress and expansion. The focus on...

Baptista Research

Baidu's financial results meet expectations, with potential for advertising growth to support long-term business. BUY rating maintained with...