Core Insights - The National Federation of Industry and Commerce has released the list of the top 100 private service enterprises in China for 2025, highlighting significant players in the service industry [1]. Group 1: Top Companies - JD Group ranks first with a total revenue of 115.88 billion yuan [2]. - Alibaba (China) Limited follows in second place with a revenue of 98.18 billion yuan [2]. - Tencent Holdings Limited is third, generating 66.03 billion yuan in revenue [2]. - Meituan (Beijing Sankuai Online Technology Co., Ltd.) is fourth with a revenue of 33.76 billion yuan [2]. - The fifth position is held by Taikang Insurance Group Co., Ltd. with 32.71 billion yuan [2]. Group 2: Additional Notable Companies - SF Holding Co., Ltd. ranks sixth with a revenue of 28.44 billion yuan [2]. - Didi Chuxing (Beijing Didi Infinity Technology and Development Co., Ltd.) is eighth, reporting 20.68 billion yuan [2]. - Ant Group (Ant Technology Group Co., Ltd.) is ninth with a revenue of 17.78 billion yuan [2]. - The tenth position is occupied by Zhongsheng (Dalian) Group Co., Ltd. with 16.81 billion yuan [2]. Group 3: Revenue Distribution - The list includes companies from various provinces, with a significant concentration in Beijing and Zhejiang [2][3]. - The revenue figures reflect the growing importance of private enterprises in China's service sector, indicating a robust economic landscape [1].

Core Insights - Meituan-W has seen continuous net buying from southbound funds for five consecutive days, with a total net buying amount of HKD 4.704 billion, while its stock price has decreased by 3.73% [2] Trading Activity - On August 27, the total trading volume of active stocks through the Hong Kong Stock Connect reached HKD 56.5 billion, with a net buying amount of HKD 13.439 billion [2] - Meituan-W's trading volume on the same day was HKD 43.88 billion, with a net buying amount of HKD 17.83 billion [2]

Core Insights - Meituan reported Q2 2025 revenue of 91.8 billion RMB, a year-on-year increase of 11.7%, but adjusted net profit fell by 89% to 1.49 billion RMB, a decrease of 12.1 billion RMB compared to the same period last year [1][2] - Following the earnings report, Meituan's stock price dropped over 9% in early trading on August 28 [1][2] Financial Performance - The core local commerce segment, which includes food delivery, saw operating profit decline by 75.6% from 15.2 billion RMB in Q2 2024 to 3.7 billion RMB in Q2 2025, with operating profit margin dropping from 25.1% to 5.7% [8] - Sales and marketing expenses surged by 51.5% year-on-year, increasing by 7.7 billion RMB to address intense competition in the food delivery and instant retail sectors [8][9] Competitive Landscape - Meituan's management acknowledged that the significant drop in profits was primarily due to intensified competition, necessitating higher incentives to maintain service quality and reliability [1][3] - CEO Wang Xing emphasized the company's commitment to defending its market position amidst ongoing competition, stating that Meituan opposes "involution" and aims to ensure quality supply and stable service [9] International Expansion - Meituan's new business segment generated 26.5 billion RMB in revenue, a 22.8% year-on-year increase, but losses expanded by 43.1% to 1.9 billion RMB, largely due to costs associated with international expansion [11] - The international brand Keeta has made significant strides, covering 20 cities in Saudi Arabia and recently launching in Qatar, with plans to enter Brazil [11][12] - Wang Xing set a long-term goal for Keeta to achieve a run rate GMV of 100 billion USD within ten years, indicating a cautious approach to international market entry [12]

Core Insights - On August 27, SenseTime-W made its debut on the Hong Kong Stock Connect active trading list for the first time in a month [1] - The total trading volume of active stocks on the Hong Kong Stock Connect reached HKD 565.00 billion, accounting for 29.55% of the day's total trading amount, with a net buying amount of HKD 134.39 billion [1] - Among the active stocks, SMIC had the highest trading volume at HKD 121.55 billion, followed by Alibaba-W and Tencent Holdings with trading volumes of HKD 78.33 billion and HKD 62.70 billion, respectively [1] Trading Activity Summary - The most frequently listed stocks in the past month were Alibaba-W and Tencent Holdings, each appearing 23 times, indicating strong interest from Hong Kong Stock Connect investors [1] - SenseTime-W recorded a trading volume of HKD 31.58 billion on its first appearance, with a net selling amount of HKD 0.86 billion, and closed the day with an increase of 8.90% [1] Active Stocks Overview - The following table summarizes the trading activity of the top active stocks on August 27: | Stock Code | Stock Name | Trading Amount (billion HKD) | Net Buying Amount (billion HKD) | Recent Listings | Latest Closing Price (HKD) | Daily Change (%) | |------------|------------------|-------------------------------|----------------------------------|------------------|----------------------------|-------------------| | 01810 | Xiaomi Group | 51.06 | -2.97 | 23 | 53.200 | -0.56 | | 00700 | Tencent Holdings | 62.70 | 0.41 | 23 | 599.000 | -1.72 | | 00981 | SMIC | 121.55 | -6.59 | 23 | 56.250 | 0.09 | | 09988 | Alibaba-W | 78.33 | 21.78 | 23 | 121.500 | 0.16 | | 03690 | Meituan-W | 43.88 | 17.83 | 19 | 116.300 | -3.08 | | 02800 | Tracker Fund | 56.61 | 55.50 | 16 | 25.700 | -1.23 | | 01347 | Hua Hong Semiconductor | 35.22 | 3.59 | 13 | 52.750 | -0.85 | | 02828 | Hang Seng China Enterprises | 32.06 | 30.43 | 11 | 92.300 | -1.28 | | 03033 | Southern Hang Seng Technology | 10.02 | 9.54 | 11 | 5.595 | -1.41 | | 09926 | CanSino Biologics | 41.98 | 5.74 | 9 | 157.000 | -7.10 | | 00020 | SenseTime-W | 31.58 | -0.86 | 1 | 2.080 | 8.90 | [1]

Group 1 - The Hong Kong stock market experienced a collective decline on August 28, with the Hang Seng Tech Index dropping nearly 1.5% [1] - Meituan reported a revenue of 91.84 billion yuan for Q2, a year-on-year increase of 11.7%, but adjusted net profit fell by 89% [1] - Ctrip Group's stock surged over 8% following its earnings report, while major players like Meituan and Alibaba faced significant declines [1] Group 2 - Guotai Junan Securities indicated that Hong Kong tech stocks benefiting from the AI cycle may become the main line of the market [2] - The latest valuation of the Hang Seng Tech Index ETF (513180) is at 22.3 times P/E, which is below 74% of the time since its inception [2] - The current valuation of the Hang Seng Tech Index is considered historically low, suggesting potential upward momentum amid improving external liquidity and Fed rate cut expectations [2]

Core Insights - Meituan reported a revenue of 91.8 billion RMB for Q2 2025, reflecting a year-on-year growth of 11.7%, indicating a robust development trend [1] - The Meituan app surpassed 500 million monthly active users in Q2, with user transaction frequency reaching a historical high [1] - The CEO emphasized the commitment to enhancing technology innovation and ecosystem development to create more value for partners and promote sustainable industry growth [1] Financial Performance - The core local business segment achieved a revenue of 65.3 billion RMB in Q2, a year-on-year increase of 7.7% [2] - Adjusted EBITDA for Q2 was 2.78 billion RMB, with adjusted net profit reaching 1.49 billion RMB [1] - New business segment revenue was 26.5 billion RMB, showing a year-on-year growth of 22.8%, with losses narrowing to 1.9 billion RMB [3] User Engagement and Market Position - In July, Meituan's instant retail daily order volume peaked at over 150 million, setting a new record [2] - The average delivery time for all orders was 34 minutes, showcasing operational efficiency [2] - Meituan has partnered with over 800 leading restaurant brands to open more than 5,500 satellite stores, with plans to exceed 10,000 by year-end [2] Initiatives for Sustainable Development - Meituan has implemented measures to enhance rider experience, including full coverage of work injury insurance for riders in 17 provinces and cities starting July 1 [4] - The company plans to eliminate overtime penalties for crowd-sourced riders by the end of 2025 [5] - Meituan has introduced cash subsidies and innovative models to support over 300,000 restaurant merchants, with nearly half reporting significant order volume increases [6] Technological Advancements - R&D investment reached 6.3 billion RMB in Q2, marking a year-on-year increase of 17.2% [6] - Meituan has established 64 drone delivery routes across major cities, completing over 600,000 orders [6] Strategic Vision - The CFO stated that the core local business has demonstrated strong resilience through multiple cycles, and new businesses continue to achieve breakthroughs, reflecting confidence in long-term growth potential [7]

Core Viewpoint - The Hong Kong stock market is experiencing a downturn, particularly in the tech sector, influenced by shrinking profits and competitive pricing wars among major internet companies [1][5]. Group 1: Company Performance - Meituan reported a 11.7% year-on-year revenue growth to 91.8 billion yuan for Q2, but its adjusted net profit fell by 89% to 1.493 billion yuan due to the "takeout subsidy war" [1]. - Alibaba's stock dropped over 3% ahead of its earnings report, while Tencent, Kuaishou, and others showed minor declines, with Xiaomi and Bilibili seeing slight gains [1]. - The Hong Kong Internet ETF (513770) saw a 1% drop in price, indicating a potential buying interest as the premium rate reached 0.58% [1]. Group 2: Market Trends - Since June, the Hong Kong stock market has underperformed compared to the A-share market, despite an increase in capital inflow, with the Hong Kong Internet ETF attracting a net inflow of 872 million yuan over the past 10 days [3]. - The liquidity tightening and the price war among major internet companies are identified as primary factors suppressing the performance of the Hong Kong tech sector [5]. - The expectation of a rate cut by the Federal Reserve in September may signal an approaching liquidity turning point for the Hong Kong market [5]. Group 3: AI Sector Focus - The AI sector in Hong Kong is gaining attention, with local chip support and a shift towards looser overseas liquidity expected to boost AI market expansion [6]. - The Hong Kong Internet ETF is positioned as a core investment in the AI sector, with the fund manager highlighting the potential for internet leaders to play a significant role in the AI era by enhancing productivity and profitability [6]. - The China Securities Hong Kong Internet Index has shown a cumulative increase of over 35% from the beginning of the year to the end of July, outperforming the Hang Seng Tech Index [6].

Group 1 - The Hong Kong stock market opened lower on August 28, with mixed performance among tech stocks and notable movements in the innovative drug and gold sectors [1] - Meituan reported Q2 revenue of 91.84 billion yuan, a year-on-year increase of 11.7%, but adjusted net profit fell by 89%, leading to a drop of over 9% in its stock price post-earnings [1] - Trip.com Group reported Q2 net revenue of 14.843 billion yuan, a year-on-year increase of 16.22%, with net profit rising by 26.43%. The company highlighted strong growth in international business segments, with total international OTA platform bookings up over 60% year-on-year [1] Group 2 - As of August 27, the latest valuation of the Hang Seng Tech Index ETF (513180) was 22.3 times, which is below 74% of the time since its inception on July 27, 2020, indicating a relative undervaluation [2] - The Hang Seng Tech Index is currently in a historically undervalued range, with potential upward momentum due to expectations of Federal Reserve interest rate cuts and improved external liquidity [2] - Investors without a Hong Kong Stock Connect account can access Chinese AI core assets through the Hang Seng Tech Index ETF (513180) [2]

Group 1 - The Hong Kong stock market opened lower on August 28, with mixed performance in tech stocks and active trading in gold stocks [1] - Meituan's Q2 revenue reached 91.84 billion yuan, a year-on-year increase of 11.7%, while adjusted net profit fell by 89% to 1.49 billion yuan [1] - Meituan's app monthly active users surpassed 500 million, and the average annual transaction frequency per user hit a historical high [1] Group 2 - The latest valuation of the Hang Seng Tech Index ETF (513180) is 22.3 times P/E, indicating it is currently undervalued compared to 74% of the time since its inception [2] - The Hang Seng Tech Index remains in a historically undervalued range, with potential upward momentum due to expectations of improved external liquidity and interest rate cuts by the Federal Reserve [2] - Investors without a Hong Kong Stock Connect account can access core Chinese AI assets through the Hang Seng Tech Index ETF (513180) [2]

August 27, 2025 09:04 AM GMT Meituan | Asia Pacific M Update 2Q25 Significant profit decline on competition Reaction to earnings Weakens our thesis Meaningful shortfall Meaningful revision lower Impact to our thesis Financial results versus consensus Direction of next 12-month consensus EPS Source: Company data, Morgan Stanley Research Key Takeaways Total Rev +12% YoY, slightly missed; Adj. EBITDA Rmb2.8bn, missed MSe/cons at Rmb6.5/Rmb11.4bn. CLC rev +8%, missed MSe/cons by 2-4%; CLC OP Rmb3.7bn, -76%, mis ...