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

[PDD (PDD US, BUY, TP US$88) TP Change]: Facing Stiff China Competition and Rising Temu Costs

PDD/Shein/Tiktok: Temu Continues to Experience Rapid Growth, a Summary of Our Recent Channel Checks

Pinduoduo (PDD US): Deciphering Massive 1Q Beat

China/Asia TMT

Shawn Yang

Equity Bottom-Up

<ul>
<li>PDD reported CY2Q23 top-line and non-GAAP net profit 28% and 58% vs. our est., and 21% and 44% vs. cons., respectively. </li>
<li>We raised our 2H23 forecasts for PDD because: 1) GMV growth hasn’t been significantly impacted by the current competitive landscape; 2) take rate could maintain a high level due to </li>
<li>Continuous optimization of ad products; and 3) new businesses such as Temu and Kuaituantuan (快团团) have fair growth. We maintain BUY and raise our TP to US$ 107.</li>
</ul>


PDD reported CY2Q23 top-line and non-GAAP net profit 28% and 58% vs. our est., and 21% and 44% vs. cons., respectively. 
We raised our 2H23 forecasts for PDD because: 1) GMV growth hasn’t been significantly impacted by the current competitive landscape; 2) take rate could maintain a high level due to 
Continuous optimization of ad products; and 3) new businesses such as Temu and Kuaituantuan (快团团) have fair growth. We maintain BUY and raise our TP to US$ 107.


[PDD Holdings (PDD US, BUY, TP US$107)]: Raise TP for GMV, Take Rate, Temu and Kuaituantuan