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.

Equity Bottom-Up

<ul><li>Cloud Music reported 1H23 financial results: total revenue declined by 8% YoY to RMB3.9bn (in line with consensus estimate), mainly due to the operational adjustment to social entertainment business.</li><li>Adjusted net income was RMB332mn in 1H23 (1H22: net loss of RMB217mn), beating consensus estimate of RMB96mn, primarily due to the enhanced GPM (+12pct YoY).</li><li>As social entertainment business continues to face pressure, we lower FY23-25E total revenue forecast by 8-9%; but we raise FY23-FY25E adjusted net income forecast to RMB686/974/1,365mn (previous: RMB194/618/1,065mn) on 1) better content cost saving; 2) optimized live streaming revenue-sharing ratio; 3) enhanced operating efficiency. </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>

Cloud Music reported 1H23 financial results: total revenue declined by 8% YoY to RMB3.9bn (in line with consensus estimate), mainly due to the operational adjustment to social entertainment business.Adjusted net income was RMB332mn in 1H23 (1H22: net loss of RMB217mn), beating consensus estimate of RMB96mn, primarily due to the enhanced GPM (+12pct YoY).As social entertainment business continues to face pressure, we lower FY23-25E total revenue forecast by 8-9%; but we raise FY23-FY25E adjusted net income forecast to RMB686/974/1,365mn (previous: RMB194/618/1,065mn) on 1) better content cost saving; 2) optimized live streaming revenue-sharing ratio; 3) enhanced operating efficiency. 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.

Cloud Music (9899 HK) – 1H23 Earnings Beat on Strong GPM Expansion

<ul><li>Cloud Music gradually shifts its focus from revenue growth to sustainable earnings growth.</li><li>We forecast total revenue to decline by 9% YoY to RMB3.9bn in 1H23, as the Company reduced in-app exposure of live streaming functions and lowered revenue sharing ratio to drive quality growth of social entertainment business.</li><li>Despite the revenue decline, we expect Cloud Music to achieve breakeven and generate adjusted net income of RMB42mn in 1H23 (1H22: net loss of RMB217mn), mainly due to the enhanced GPM (+10pcts YoY). </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>

Cloud Music gradually shifts its focus from revenue growth to sustainable earnings growth.We forecast total revenue to decline by 9% YoY to RMB3.9bn in 1H23, as the Company reduced in-app exposure of live streaming functions and lowered revenue sharing ratio to drive quality growth of social entertainment business.Despite the revenue decline, we expect Cloud Music to achieve breakeven and generate adjusted net income of RMB42mn in 1H23 (1H22: net loss of RMB217mn), mainly due to the enhanced GPM (+10pcts YoY). 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.

Cloud Music (9899 HK) – 1H23 Preview: Solid Improvement in Profitability

<ul>
<li>Cloud Music reported FY22 financial results on 23 Feb. Total revenue was up by 24% YoY to RMB4.7bn in 2H22, largely in line with our/consensus estimate of RMB4.6/4.8bn.</li>
<li>FY22 total revenue grew by 29% YoY to RMB9.0bn in FY22, driven by solid growth of social entertainment and music subscription businesses.</li>
<li>Cloud Music recorded positive adjusted net income of RMB102mn in 2H22 versus adjusted net loss of RMB511mn in 2H21, beating our/consensus estimate (adj. net loss of RMB135/188mn), mainly attributable to the strong GPM expansion and effective control in marketing. </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>


Cloud Music reported FY22 financial results on 23 Feb. Total revenue was up by 24% YoY to RMB4.7bn in 2H22, largely in line with our/consensus estimate of RMB4.6/4.8bn.
FY22 total revenue grew by 29% YoY to RMB9.0bn in FY22, driven by solid growth of social entertainment and music subscription businesses.
Cloud Music recorded positive adjusted net income of RMB102mn in 2H22 versus adjusted net loss of RMB511mn in 2H21, beating our/consensus estimate (adj. net loss of RMB135/188mn), mainly attributable to the strong GPM expansion and effective control in marketing. 

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.

Cloud Music (9899 HK) – Strong GPM expansion supported the breakeven in 2H22

<div><div><div><div><ul><li>Initiate at BUY. Cloud Music is the second largest online music platform in China in terms of both revenue and MAU, taking 19% market share of China’s online music revenue per iResearch and our estimate in 2021.</li><li>Compared to the market leader TME, Cloud Music remains at early stage of monetization, with ample room for revenue growth and margin improvement.</li><li>We expect Cloud Music to benefit from the secular trend of rising paying ratio, growing ARPPU and rationalizing music licensing costs in the China online music sector.</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></div></div></div></div>

Initiate at BUY. Cloud Music is the second largest online music platform in China in terms of both revenue and MAU, taking 19% market share of China’s online music revenue per iResearch and our estimate in 2021.Compared to the market leader TME, Cloud Music remains at early stage of monetization, with ample room for revenue growth and margin improvement.We expect Cloud Music to benefit from the secular trend of rising paying ratio, growing ARPPU and rationalizing music licensing costs in the China online music sector.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.

Cloud Music (9899 HK) – Monetization and margin improvement on the horizon

China

NetEase Cloud Music operates as one of China's leading online music platforms, offering music streaming, membership subscriptions, digital music sales, and social entertainment services including live streaming and online karaoke. It provides an interactive content community for music enthusiasts with personalized recommendations. The company is headquartered in Hangzhou, China, and was launched in 2013.

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NetEase Cloud Music (9899 HK)

Cloud Music (9899 HK) – 1H23 Earnings Beat on Strong GPM Expansion

Adjusted net income was RMB332mn in 1H23 (1H22: net loss of RMB217mn), beating consensus estimate of RMB96mn, primarily due to the enhanced GPM...

CMB International

Cloud Music (9899 HK) – 1H23 Preview: Solid Improvement in Profitability

We forecast total revenue to decline by 9% YoY to RMB3.9bn in 1H23, as the Company reduced in-app exposure of live streaming functions and lowered...

CMB International

Cloud Music (9899 HK) – Strong GPM expansion supported the breakeven in 2H22

Cloud Music reported FY22 financial results on 23 Feb. Total revenue was up by 24% YoY to RMB4.7bn in 2H22, largely in line with our/consensus...

CMB International

Cloud Music (9899 HK) – Monetization and margin improvement on the horizon

Compared to the market leader TME, Cloud Music remains at early stage of monetization, with ample room for revenue growth and margin improvement.

CMB International

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