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 Holdings Inc. (PDD US, BUY, TP US$95) Earnings Preview]: BUY on Expected Margin Beat

Pinduoduo(PDD US): The Worst Is yet to Come

Pinduoduo (PDD US, BUY, TP US$95) Earnings Review: A Long Term Buy Amid Challenges in 2Q23

[Pinduoduo (PDD US) Target Price Change]: Cut TP for Higher Losses from Temu

Pinduoduo (PDD US) – Resilient GMV growth to sustain in 2023

China/Asia TMT

Shawn Yang

Equity Bottom-Up

<ul>
<li>PDD reported C4Q22 total revenue and non-GAAP net income (5.1%) and 8.4% higher than cons. Topline miss mainly comes from the deceleration of online marketplace services. </li>
<li>We expect that PDD’s domestic eCommerce will experience slowdown in growth.  Temu is likely to grow GMV rapidly with high losses from branding and subsidies.</li>
<li>PDD still outpaces its peers including JD, BABA and Shein, in both domestic and oversea markets. Maintain BUY rating on PDD with TP of US$95, which implies 24x P/2023E.</li>
</ul>


PDD reported C4Q22 total revenue and non-GAAP net income (5.1%) and 8.4% higher than cons. Topline miss mainly comes from the deceleration of online marketplace services. 
We expect that PDD’s domestic eCommerce will experience slowdown in growth.  Temu is likely to grow GMV rapidly with high losses from branding and subsidies.
PDD still outpaces its peers including JD, BABA and Shein, in both domestic and oversea markets. Maintain BUY rating on PDD with TP of US$95, which implies 24x P/2023E.


[PDD US]: Slowing Growth but Still Best-In-Class, Cut TP Maintain BUY.