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

Thematic (Sector/Industry)

<ul>
<li>Competitors tried to leverage LLM to capture Baidu's search market share;</li>
<li>JD.com is actively seeking new, post-subsidy growth drivers, the latest being Europe while Red Notes launched US expansion. Deliveroo ceded HK market to Meituan;</li>
<li>NetEase competitor announced major layoffs. Weibo disappointed in its C4Q24 earnings. Kingsoft has a winner game in pocket.</li>
</ul>


Competitors tried to leverage LLM to capture Baidu's search market share;
JD.com is actively seeking new, post-subsidy growth drivers, the latest being Europe while Red Notes launched US expansion. Deliveroo ceded HK market to Meituan;
NetEase competitor announced major layoffs. Weibo disappointed in its C4Q24 earnings. Kingsoft has a winner game in pocket.


[Blue Lotus Non-US Internet Weekly, 11/52]: Chinese Internet Making Inroads Overseas

Analyst - Media&Entertainment Sector, Blue Lotus Research Institute

Stan Zhao

Analyst - Media&Entertainment Sector

<ul>
<li>Earnings results have differed in the recently concluded C3Q24. Performance ads in home electronics, 3C, auto, entertainment and travel have benefited from recovery in consumption; </li>
<li>Heading into C4Q24, we expect rebound in real estate to benefit property ads, and the continuing warm up in consumption to spread to e-commerce (apparel and cosmetics);</li>
<li>We expect trade-in subsidies for home electronics and electrical vehicles to renew in C1Q25 and further stimulus to encourage consumption in travel and catering to be announced. </li>
</ul>


Earnings results have differed in the recently concluded C3Q24. Performance ads in home electronics, 3C, auto, entertainment and travel have benefited from recovery in consumption; 
Heading into C4Q24, we expect rebound in real estate to benefit property ads, and the continuing warm up in consumption to spread to e-commerce (apparel and cosmetics);
We expect trade-in subsidies for home electronics and electrical vehicles to renew in C1Q25 and further stimulus to encourage consumption in travel and catering to be announced. 


Stimulus Policies Are Now the Biggest Determinant of Internet Ads Performances

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Equity Bottom-Up

Tencent Music Entertainment Group / Equity Bottom-Up

<ul>
<li>Hong Kong market sectors outperforming since the stimulus in September are Consumer Discretionary and Healthcare as Utilities, Telecom and Energy lag.</li>
<li>
<a href="https://www.smartkarma.com/entities/crrc-corp-ltd-461535b2-37ac-4589-b4d9-8b71c06c43b8" target="_blank" data-smartkarma-citation="entities:124:1" rel="noopener">CRRC Corp Ltd H (1766 HK)</a> gets BUY recommendations as its results point to continued strength in the rail equipment sector with passenger volume surging.
</li>
<li>
<a href="https://www.smartkarma.com/entities/tencent-music-entertainment-group" target="_blank" data-smartkarma-citation="entities:36601:1" rel="noopener">Tencent Music Entertainment Group (1698 HK)</a> reported solid results as it shifts to a pay-to-stream subscription model. <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 HK)</a> had a blowout quarter with EV sales surging.
</li>
</ul>


Hong Kong market sectors outperforming since the stimulus in September are Consumer Discretionary and Healthcare as Utilities, Telecom and Energy lag.

CRRC Corp Ltd H (1766 HK) gets BUY recommendations as its results point to continued strength in the rail equipment sector with passenger volume surging.


Tencent Music Entertainment Group (1698 HK) reported solid results as it shifts to a pay-to-stream subscription model. Xiaomi Corp (1810 HK) had a blowout quarter with EV sales surging.



BUY/SELL/HOLD: Hong Kong Stock Updates (NOVEMBER 18)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/weibo-corp" target="_blank" data-smartkarma-citation="entities:35280:1" rel="noopener">Weibo (9898 HK)</a> is an inexpensive profitable large social media company in China</li>
<li>Weibo generates a large cash flow which it uses to pay a 9% dividend yield</li>
<li>Weibo has synergies with Alibaba's core e-commerce business and fits well within its other media company ecosystem</li>
</ul>



Weibo (9898 HK) is an inexpensive profitable large social media company in China
Weibo generates a large cash flow which it uses to pay a 9% dividend yield
Weibo has synergies with Alibaba's core e-commerce business and fits well within its other media company ecosystem


BABA's Babies: They're All Grown Now! Weibo the Twitter of China

<ul>
<li>The conglomerate sector continues to show momentum in Hong Kong while the materials and energy sectors lag</li>
<li>
<a href="https://www.smartkarma.com/entities/weibo-corp" target="_blank" data-smartkarma-citation="entities:35280:1" rel="noopener">Weibo (9898 HK)</a><a href="https://www.smartkarma.com/entities/weibo-corp-adr" target="_blank" data-smartkarma-citation="entities:3826:1" rel="noopener">Weibo Corp (WB US)</a> was rated a BUY as valuations and potential catalysts from parent <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group Holding (9988 HK)</a> could support a higher stock price.
</li>
<li>
<a href="https://www.smartkarma.com/entities/china-east-education-holdings" target="_blank" data-smartkarma-citation="entities:27843:1" rel="noopener">China East Education (667 HK)</a> was upgraded to BUY with higher higher price target due to profit increase. <a href="https://www.smartkarma.com/entities/dongfang-electric-corporation-limited" target="_blank" data-smartkarma-citation="entities:1251:1" rel="noopener">Dongfang Electric (1072 HK)</a> was initiated with a BUY with strong upside.
</li>
</ul>


The conglomerate sector continues to show momentum in Hong Kong while the materials and energy sectors lag

Weibo (9898 HK)Weibo Corp (WB US) was rated a BUY as valuations and potential catalysts from parent Alibaba Group Holding (9988 HK) could support a higher stock price.


China East Education (667 HK) was upgraded to BUY with higher higher price target due to profit increase. Dongfang Electric (1072 HK) was initiated with a BUY with strong upside.



BUY/SELL/HOLD: Hong Kong Stock Updates (September 21)

China

Weibo Corp is a social media platform for people to create, distribute and discover Chinese-language content.  The Company offers users public self-expression in real time with a powerful platform for social interaction, as well as content aggregation and distribution.

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Weibo Corp (WB US)

[Blue Lotus Non-US Internet Weekly, 11/52]: Chinese Internet Making Inroads Overseas

Competitors target Baidu's search market, JD.com seeks new growth in Europe, Weibo disappoints in earnings, Kingsoft has successful game.

Blue Lotus Research Institute

Stimulus Policies Are Now the Biggest Determinant of Internet Ads Performances

C3Q24 earnings show ad performances are highly correlated with stimulus spending. We expect continuing stimulus to sustain the benefit and...

Blue Lotus Research Institute

BUY/SELL/HOLD: Hong Kong Stock Updates (NOVEMBER 18)

Hong Kong has seen its Consumer Discretionary and Healthcare sectors perform well since the stimulus in September. CRCC has had several buy...

David Mudd

BABA's Babies: They're All Grown Now! Weibo the Twitter of China

WB is up 60% over the past few days. Citi put the company on its "90-day positive catalyst watch list" with a US$12 price target. The upcoming...

David Mudd

BUY/SELL/HOLD: Hong Kong Stock Updates (September 21)

Conglomerate stocks in Hong Kong have outperformed this month. Weibo target price is upgraded and Dongfang Electric is intiated BUY. CEE saw a...

David Mudd

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Blue Lotus Non-US Internet Weekly, 11/52]: Chinese Internet Making Inroads Overseas

​Competitors target Baidu's search market, JD.com seeks new growth in Europe, Weibo disappoints in earnings, Kingsoft has successful game.

Blue Lotus Research Institute

Stimulus Policies Are Now the Biggest Determinant of Internet Ads Performances

​C3Q24 earnings show ad performances are highly correlated with stimulus spending. We expect continuing stimulus to sustain the benefit and...

Blue Lotus Research Institute

BUY/SELL/HOLD: Hong Kong Stock Updates (NOVEMBER 18)

Hong Kong has seen its Consumer Discretionary and Healthcare sectors perform well since the stimulus in September. CRCC has had several buy...

David Mudd

BABA's Babies: They're All Grown Now! Weibo the Twitter of China

WB is up 60% over the past few days. Citi put the company on its "90-day positive catalyst watch list" with a US$12 price target. The upcoming...

David Mudd

BUY/SELL/HOLD: Hong Kong Stock Updates (September 21)

Conglomerate stocks in Hong Kong have outperformed this month. Weibo target price is upgraded and Dongfang Electric is intiated BUY. CEE saw a...

David Mudd

Competitors target Baidu's search market, JD.com seeks new growth in Europe, Weibo disappoints in earnings, Kingsoft has successful game.

C3Q24 earnings show ad performances are highly correlated with stimulus spending. We expect continuing stimulus to sustain the benefit and...