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 ...

Summary of Meituan's 2Q25 Conference Call Company Overview - **Company**: Meituan (3690.HK) - **Industry**: E-commerce & Logistics in China Key Points and Arguments Financial Performance - **2Q25 Results**: Revenue increased by 12% year-over-year, but adjusted net profit fell by 89% year-over-year, missing expectations of 16% revenue growth and a 54% decline in profit [2][25] - **Food Delivery Business**: Experienced significant losses, with an estimated decline in profits of approximately Rmb10 billion compared to competitors JD and Alibaba, which reported losses of over Rmb13 billion and Rmb10 billion respectively [2][25] - **Market Reaction**: Initial market response was negative, with Meituan's stock dropping 9% compared to a 3% decline in the KWEB index [2][25] Competition and Market Dynamics - **Food Delivery Competition**: Intense competition since May has led to wider losses, with expectations of continued losses into 3Q. Estimated EBIT loss per order for 3Q is projected to exceed Rmb2, compared to previous breakeven expectations [2][21] - **Market Share**: Long-term market share is expected to decrease from 75-80% to 50-55% due to increased competition [20][29] Growth and Strategic Initiatives - **Volume Growth**: Food delivery volumes grew by approximately 11% year-over-year in 2Q25, with forecasts of 13% growth for 3Q25 and FY25 [21][23] - **Instashopping Growth**: Instashopping order volume is expected to grow by 31% year-over-year, driven by increased transaction frequency and new user acquisition [21][24] - **Strategic Pivot**: Closure of Meituan Select and a shift towards Ella Supermarket/Instashopping indicate a commitment to core business defense [20][29] Financial Forecasts - **Revenue Forecasts**: Adjusted revenue forecasts for FY25E-FY27E have been cut by 7%, with FY25E adjusted net profit revised to a loss of Rmb14 billion from a previous profit estimate of Rmb29 billion [25][29] - **Valuation**: Target price revised to HK$144 per share from HK$159, reflecting a downward adjustment in long-term market share and profit expectations [25][36] Risks and Challenges - **Downside Risks**: Include worse-than-expected competition, labor cost inflation, and food safety concerns [30][31] Long-term Outlook - **Profit Recovery Potential**: Positive outlook for profit recovery from FY26E-FY27E as competition subsidies are expected to normalize [29][30] - **Investment in New Initiatives**: Continued investment in grocery retail and overseas expansion, with a long-term target of achieving Rmb100 billion in overseas GTV by 2033E [28][29] Additional Important Information - **Market Capitalization**: HK$725.5 billion / $93.1 billion [8] - **Enterprise Value**: HK$553.1 billion / $71.0 billion [8] - **3M Average Daily Trading Volume**: HK$6.8 billion / $861.7 million [8] This summary encapsulates the critical insights from Meituan's 2Q25 conference call, highlighting the company's financial performance, competitive landscape, growth strategies, and future outlook.

Summary of Meituan's Conference Call Company Overview - **Company**: Meituan (3690.HK) - **Industry**: China Internet and Other Services Key Points and Arguments Financial Performance - **Price Target Adjustment**: Price target reduced from HK$150.00 to HK$135.00 due to ongoing losses and competitive pressures [1] - **3Q Loss Expectations**: Anticipated on-demand operating profit (OP) loss of Rmb15 billion for 3Q, with a CLC OP loss of Rmb10 billion [3][5] - **2Q Performance**: Total revenue increased by 12% YoY, but missed estimates; adjusted EBITDA was Rmb2.8 billion, significantly below expectations [27] - **Core Local Commerce (CLC)**: CLC revenue grew by 8% YoY, but OP fell by 76% to Rmb3.7 billion, missing estimates due to intensified competition [27] - **New Initiatives**: Revenue from new initiatives rose by 23%, but operating loss was Rmb1.9 billion, better than expected due to overseas investments [27] Market Dynamics - **Competition**: Increased competition since May, particularly during the 618 festival, has led to significant losses in the on-demand segment [2][3] - **Subsidy Impact**: Anticipated acceleration in on-demand volume to high teens due to increased subsidies, but profitability is expected to decline due to price competition [3] - **Market Share**: Despite aggressive subsidies, Meituan maintains a solid GTV share of over 70% in high-quality orders [4] Long-Term Outlook - **Cost Efficiency**: Long-term competitiveness is believed to be intact due to cost efficiency, with per-order losses only one-third of competitors [4] - **Future Projections**: Long-term estimates for food delivery GTV margin projected at 2.3% and user efficiency (UE) at Rmb1.08 [54] - **Investment Strategy**: Focus on high-quality orders and effective investment in new initiatives expected to expand the addressable market [63] Risks and Challenges - **Earnings Pressure**: Near-term uncertainties and competitive pressures pose risks to earnings, making it difficult for Meituan to control competition pace [5][54] - **Market Fragmentation**: The quick commerce market is expected to split among multiple players, impacting Meituan's market share [54] Valuation and Recommendations - **Valuation Methodology**: Price target of HK$135 implies a target P/E of 17x for 2026 estimates, comparable to Tencent's 19x [31] - **Investment Rating**: Maintained an Overweight (OW) rating despite short-term challenges, with some earnings pressure already priced in [5] Additional Important Information - **Share Repurchase**: Meituan repurchased HK$391 million worth of shares in 2Q [27] - **Market Capitalization**: Current market cap is approximately US$92.66 billion [7] This summary encapsulates the key insights from Meituan's recent conference call, highlighting the company's current challenges, competitive landscape, and long-term strategies.

Market Overview - On August 27, the Hang Seng Index fell by 1.27%, with southbound trading totaling HKD 191.17 billion, comprising HKD 103.27 billion in buying and HKD 87.90 billion in selling, resulting in a net buying amount of HKD 15.37 billion [1] Southbound Trading Details - Southbound trading through the Stock Connect (Shenzhen) recorded a total transaction amount of HKD 72.79 billion, with buying at HKD 39.58 billion and selling at HKD 33.21 billion, leading to a net buying of HKD 6.37 billion [1] - Southbound trading through the Stock Connect (Shanghai) had a total transaction amount of HKD 118.38 billion, with buying at HKD 63.69 billion and selling at HKD 54.69 billion, resulting in a net buying of HKD 9.01 billion [1] Active Stocks - The most actively traded stock on August 27 was SMIC, with a total transaction amount of HKD 121.55 billion, followed by Alibaba-W and Tencent Holdings with transaction amounts of HKD 78.33 billion and HKD 62.70 billion, respectively [1] - The top net buying stocks included the Tracker Fund of Hong Kong with a net buying amount of HKD 55.50 billion, followed by Hang Seng China Enterprises with HKD 30.43 billion and Alibaba-W with HKD 21.78 billion [1] Continuous Net Buying and Selling - Three stocks experienced continuous net buying for more than three days, with Tencent Holdings leading at nine days, followed by Meituan-W at five days and Alibaba-W at four days [2] - The highest net buying amounts during this period were Tencent Holdings at HKD 69.24 billion, Meituan-W at HKD 47.04 billion, and Alibaba-W at HKD 44.96 billion [2] - The stocks with the highest net selling included Xiaomi Group-W and SMIC, with net selling amounts of HKD 28.00 billion and HKD 24.53 billion, respectively [2]

恒指低开0.68%，恒生科技指数跌0.99%。科网股延续调整，美团大跌近10%，Q2经调整净利同比骤降 89%，理想汽车、小鹏汽车跌4%；医药股多数反弹，信达生物涨超4%；携程集团绩后高开5%，二季度 营收同比升16%。 ...

每经AI快讯，8月28日，港股科网股多数走低，截至发稿，美团-W（03690.HK）跌9.20%、阿里巴巴- SW（09988.HK）跌3.37%、京东集团-SW（09618.HK）跌1.81%、贝壳-W（02423.HK）跌1.06%。 ...