Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy 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>Beike reported C4Q24 revenue beat our estimate/consensus by 8.4%/7.4%, non-GAAP OP miss our estimate/consensus by 37.5%/21.6%, due to front-loading expansion cost.</li>
<li>We expect Beike to take 2-3ppt of market share in a rebalancing property market in 2025. </li>
<li>We keep the stock as BUY and keep TP at US$25.</li>
</ul>


Beike reported C4Q24 revenue beat our estimate/consensus by 8.4%/7.4%, non-GAAP OP miss our estimate/consensus by 37.5%/21.6%, due to front-loading expansion cost.
We expect Beike to take 2-3ppt of market share in a rebalancing property market in 2025. 
We keep the stock as BUY and keep TP at US$25.


[KE Holdings (BEKE US, BUY, TP US$25) Earnings Review]: Housing Inventory Resolution Drives Recovery

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>Beike reported 4Q24 results: revenue rose 47% YoY to RMB31.1bn, beating Bloomberg consensus and CMBI estimates by 8%, mainly due to the sizzling transaction sentiment in 4Q24 where existing home GTV (EHT) surged 60% YoY, increasing its FY market share by 3ppts, and new home transactions (NHT) jumped 50% YoY.</li><li>Non-GAAP net income was RMB1.3bn, with a margin of 4.3%, missing consensus/our estimates by 24%/39% due to RMB1.5bn in one-off expenses.</li><li>We think BEKE's measures, such as 1) further expansion of agent teams, 2) continuous shift to compensation structure, and 3) reserved attitude on profit-taking in the early recovery stage of property market may continue to refrain its profitability. </li></ul>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.

Beike reported 4Q24 results: revenue rose 47% YoY to RMB31.1bn, beating Bloomberg consensus and CMBI estimates by 8%, mainly due to the sizzling transaction sentiment in 4Q24 where existing home GTV (EHT) surged 60% YoY, increasing its FY market share by 3ppts, and new home transactions (NHT) jumped 50% YoY.Non-GAAP net income was RMB1.3bn, with a margin of 4.3%, missing consensus/our estimates by 24%/39% due to RMB1.5bn in one-off expenses.We think BEKE's measures, such as 1) further expansion of agent teams, 2) continuous shift to compensation structure, and 3) reserved attitude on profit-taking in the early recovery stage of property market may continue to refrain its profitability. 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.

Ke Holdings (BEKE US) - Proactive Investment to Drive Better Business Development Prospects...

Director, Head of Research, Smartkarma

Pranav Rao

Director, Head of Research

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

Event-Driven

Agricultural Bank Of China / Event-Driven

<ul>
<li>Welcome to Curator’s Cut, a fortnightly roundup of standout themes from the 1,200+ Insights published over the past two weeks on Smartkarma</li>
<li>In this cut, we explore A-H share trading dynamics, consider copper market dynamics and plays, and China's bottoming/stabilizing real estate market</li>
<li>Want to dig deeper? Comment or message with the themes you’d like to see highlighted next</li>
</ul>


Welcome to Curator’s Cut, a fortnightly roundup of standout themes from the 1,200+ Insights published over the past two weeks on Smartkarma
In this cut, we explore A-H share trading dynamics, consider copper market dynamics and plays, and China's bottoming/stabilizing real estate market
Want to dig deeper? Comment or message with the themes you’d like to see highlighted next


Curator's Cut: Arbs Go A-H, Copper Plays & China's Property Pulse

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

Thematic (Sector/Industry)

<ul>
<li>With consumption in the doldrums, one would expect none growing at double digits. This is actually not the case; </li>
<li>Further, how many Chinese Growth Equity names are accelerating in growth in the second half? Quite a lot;</li>
<li>We reiterate our view that Chinese Internet names are took-all winners with strong pricing power, which are showing when they need to. The weak market sentiment is self-fulfilling.</li>
</ul>


With consumption in the doldrums, one would expect none growing at double digits. This is actually not the case; 
Further, how many Chinese Growth Equity names are accelerating in growth in the second half? Quite a lot;
We reiterate our view that Chinese Internet names are took-all winners with strong pricing power, which are showing when they need to. The weak market sentiment is self-fulfilling.


How Many Chinese Growth Equity Names Are Growing at Double Digits?

<ul><li>China’s destocking scheme showed encouraging progress, with Guangzhou announcing to purchase developers’ unsold inventory at cost prices, which could serve as an example for other cities. We think the scheme currently may only benefit SOEs/semi-SOEs as LGFVs may need to divest their financing function at first.</li><li>A number of regions actively implemented mortgage rate related policies after 17 May, and we think there is still room for further adjustment in Beijing, Shanghai and Shenzhen.</li><li>Noticeable recovery on property sales was shown with the daily transaction volume post-517 policy for new/second hand home increasing by 23%/21% compared to pre-517 policy. </li></ul>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.

China’s destocking scheme showed encouraging progress, with Guangzhou announcing to purchase developers’ unsold inventory at cost prices, which could serve as an example for other cities. We think the scheme currently may only benefit SOEs/semi-SOEs as LGFVs may need to divest their financing function at first.A number of regions actively implemented mortgage rate related policies after 17 May, and we think there is still room for further adjustment in Beijing, Shanghai and Shenzhen.Noticeable recovery on property sales was shown with the daily transaction volume post-517 policy for new/second hand home increasing by 23%/21% compared to pre-517 policy. 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.

Property - Encouraging Signs on Both Policy Implementation and Property Sales, Reiterate Buy

China

KE Holdings Inc. operates as an integrated online and offline platform for housing transactions and services. The Company offers existing and new home sales, home rentals, home renovation, real estate financial solutions, and other services. KE Holdings conducts businesses in China.

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KE Holdings (BEKE US)