Core Viewpoint - Nomura maintains a target price of HKD 55 for Kuaishou and a neutral rating, indicating a stable outlook for the company despite market fluctuations [1] Financial Performance - Kuaishou's Q1 2025 revenue increased by 11% year-on-year, aligning with Bloomberg consensus and Nomura's expectations [1] - Adjusted net profit rose by 4% to RMB 4.6 billion, exceeding market consensus by 2% [1] - E-commerce GMV grew by 15% year-on-year, with live-streaming e-commerce (LSE) expected to see annual growth in the mid to high single digits [1] Business Outlook - Kuaishou has raised its annual revenue forecast for its "Keling" model from USD 60 million to USD 100 million, driven by a Q1 revenue of RMB 150 million that surpassed expectations [1]

Investment Rating - The report assigns a "Buy" rating for the company, Kuaishou (1024 HK), with a target price of HKD 64.00, indicating a potential upside of 31.3% from the current price of HKD 48.75 [1][24]. Core Insights - The first quarter performance of Kuaishou met expectations, with total revenue and adjusted net profit reaching RMB 32.6 billion and RMB 4.6 billion respectively, reflecting year-on-year growth of 11% and 4% [5]. - The report highlights that Kuaishou's overseas operations have turned profitable, accelerating commercialization efforts [2]. - The company is expected to maintain growth in e-commerce GMV and advertising revenue, with projections for the second quarter indicating a 14% year-on-year increase in e-commerce GMV and a 12% growth in advertising revenue [5]. Financial Overview - Revenue projections for Kuaishou are as follows: RMB 113.47 billion in 2023, RMB 126.90 billion in 2024, RMB 142.34 billion in 2025, RMB 155.56 billion in 2026, and RMB 168.17 billion in 2027, with year-on-year growth rates of 20.5%, 11.8%, 12.2%, 9.3%, and 8.1% respectively [25]. - The adjusted net profit is forecasted to grow from RMB 10.27 billion in 2023 to RMB 28.50 billion in 2027, with significant growth in the years 2024 and 2025 [25]. - The report notes that the adjusted net profit margin is expected to stabilize around 14% for 2025, maintaining similar levels to 2024 [5]. Segment Performance - E-commerce GMV grew by 15% year-on-year, with the MAU penetration rate at 19% and average spending per user increasing by 7% [5]. - Online marketing revenue growth has slowed to 8% year-on-year, primarily due to high base effects from external advertising and support for merchants [5]. - Live streaming revenue has resumed growth, increasing by 14% year-on-year, with a significant rise in the number of contracted agencies and streamers [5]. Valuation - The report maintains the 2025 profit expectation at RMB 20.3 billion, corresponding to an adjusted net profit margin of 14% [5]. - A valuation premium is applied due to Kuaishou's leading video generation capabilities and commercialization potential, with a target price based on a 13x P/E ratio for 2025 [5].

Investment Rating - The report maintains a "BUY" rating for Kuaishou, with a target price of HK$80.00, indicating a potential upside of 64.1% from the current price of HK$48.75 [3][20]. Core Insights - Kuaishou's 1Q25 results were in line with expectations, showing a total revenue increase of 11% YoY to RMB32.6 billion and an adjusted net profit rise of 4% YoY to RMB4.6 billion [1][2]. - The monetization of Kling AI is accelerating, generating over RMB150 million in 1Q25, and is expected to exceed RMB700 million in FY25E [1][8]. - Revenue growth is forecasted to continue, with an expected 12% YoY increase in total revenue for 2Q25E, driven by online marketing and e-commerce [1][8]. Financial Performance - For FY25E, total revenue is projected at RMB141.85 billion, with adjusted net profit expected to reach RMB20.12 billion [2][9]. - The adjusted net profit margin is anticipated to remain stable at around 14.2% for FY25E [9][18]. - The company is investing heavily in AI, with R&D expenses growing by 16% YoY to RMB3.3 billion in 1Q25, representing 10.1% of total revenue [8][18]. Revenue Breakdown - In 1Q25, online marketing revenue increased by 8% YoY to RMB18.0 billion, accounting for 55% of total revenue [8]. - Other services revenue grew by 15% YoY to RMB4.8 billion, while live streaming revenue rose by 14% YoY to RMB9.8 billion [8][11]. - E-commerce GMV increased by 15% YoY to RMB332.3 billion, supported by growth in both monthly paying users and GMV per user [8]. Valuation Metrics - Kuaishou is currently trading at a non-IFRS PE of 10x for FY25E, which is attractive compared to the sector average of 16x and its 2-year historical average of 15x [1][3]. - The SOTP-derived target price of HK$80.00 is based on valuations of its live streaming, online marketing, and e-commerce businesses, with respective contributions of HK$9.7, HK$23.4, and HK$39.7 per share [12][13][15].

Investment Rating - The report maintains a "Buy" rating for Kuaishou with a target price of HK$66, representing an expected return of 35.4% from the current price of HK$48.75 [6][10][22]. Core Insights - Kuaishou's advertising growth is expected to accelerate in the second half of 2025, driven by easier comparisons for non-ecommerce ads and ongoing monetization efforts in various verticals [1][2]. - The company has seen a positive trend in monetization from its Kling platform, with plans to introduce more cost-effective versions to enhance user engagement and revenue [4][22]. - Despite challenges in the live streaming segment due to regulatory pressures, Kuaishou's overall revenue growth remains robust, with a projected 12% revenue growth in 2Q25E [2][12]. Revenue Outlook - Kuaishou's total revenue for 1Q25 was Rmb32.6 billion, reflecting a year-on-year increase of 10.9%, with live streaming revenues up 14.4% and advertising revenues increasing by 8.0% [12][13]. - The company anticipates a GMV growth of 14% year-on-year for 2Q25E, supported by traffic boosts for merchants during the upcoming 618 shopping festival [2][12]. - The full-year revenue growth estimate is maintained at 13% year-on-year, with expectations for continued growth in ecommerce and advertising segments [2][12]. Margin Outlook - Kuaishou's operating profit margin (OPM) is expected to expand year-on-year in 2025, although this may be offset by a higher effective tax rate, leading to a flat net profit margin (NPM) [3][12]. - The adjusted earnings estimates for 2025 are maintained at Rmb20 billion, with a focus on improving margins through higher-margin advertising revenues [3][12]. Updates on Kling - Kling generated Rmb150 million in revenue in 1Q25, with a rapid increase in both individual and enterprise users, indicating strong growth potential [4][12]. - The rollout of Kling AI 2.0 is expected to further enhance monetization efforts, catering to diverse user demands [4][12]. Financial Summary - Kuaishou's financial performance shows a significant increase in net profit from Rmb10.3 billion in 2023 to an estimated Rmb20.1 billion in 2025, with a diluted EPS growth of 15% [5][10]. - The company is projected to maintain a strong return on equity (ROE) of 27.9% in 2025, reflecting effective capital utilization [5][10].

Investment Rating - The report maintains a "Buy" rating for Kuaishou Technology with a revised 12-month price target of HK$63.00, indicating an upside potential of 29.2% from the current price of HK$48.75 [1]. Core Insights - Kuaishou reported in-line results for 1Q25 and maintained its FY25 guidance on advertising, eCommerce, and profitability, with a positive outlook on growth momentum for the remainder of the year [1][19]. - The advertising momentum is expected to improve, with management targeting a 12% year-on-year growth in 2Q25 and further acceleration anticipated in the second half of the year [2][34]. - The eCommerce segment is projected to achieve 13-15% year-on-year GMV growth, supported by stable livestreaming and a focus on enhancing merchant ROI through AI tools [3][37]. - The Kling monetization outlook has been raised significantly, with FY25 revenue expectations increased to US$100 million, reflecting a rapid expansion of paying users [4][22]. Summary by Sections Advertising - Management anticipates a 12% year-on-year growth in advertising for 2Q25, with expectations for high-teens growth in the second half of the year driven by contributions from mini-games and local services [34]. - The advertising target for FY25 remains unchanged at approximately 14% year-on-year growth [34]. eCommerce - Kuaishou aims for 13-14% year-on-year GMV growth in 2Q25, with a stable overall take rate of around 4% for 2025 [37]. - The company plans to start monetizing pan-shelf based eCommerce traffic to improve the take rate from nearly 0% to approximately 1-2% in the second half of 2025 [38]. Kling AI - The revenue outlook for Kling AI has been raised to US$100 million for FY25, driven by a growing base of paying users and enhanced marketing efforts [4][22]. - The revenue mix indicates that 70% of Kling AI revenue comes from subscriptions, primarily from professional content creators, while 30% is derived from API calling revenue [23]. Financial Projections - Revenue estimates for 2025-2027 have been fine-tuned upwards by 0.7% to 1.1%, reflecting better-than-expected performance in livestreaming and other services [19][21]. - The projected total revenue for 2025 is Rmb 140,739 million, with net income expected to be Rmb 19,104 million [17][21].

Group 1 - The Hang Seng Index opened slightly higher but experienced a decline, closing down 0.55% at 23,254.45 points, with a trading volume of 99.948 billion HKD [1] - The technology sector, particularly the performance of Kuaishou, saw a notable increase of 5.03% following its earnings report [1] - Xiaomi Group reported a record high total revenue for Q1, resulting in a 1.36% increase in its stock price [1] Group 2 - The aviation sector showed positive movement, with China Southern Airlines rising by 3.32% [1] - Semiconductor stocks, including SMIC, faced a decline, with SMIC's stock down by 1.01% [1] - The logistics and film sectors led the market, while consumer stocks, semiconductor, and automotive sectors experienced the largest declines [1]

Market Overview - A-shares opened higher on May 28, with the three major indices experiencing fluctuations. The sectors of autonomous driving and nuclear power were active, while aviation and communication equipment also saw gains [1] - As of the report, the Shanghai Composite Index fell by 0.03%, the Shenzhen Component Index decreased by 0.12%, and the ChiNext Index dropped by 0.02% [1] Hong Kong Market - The Hang Seng Index declined by 0.23%, and the Hang Seng Tech Index fell by 0.06% [2][3] Bond Market - The bond market saw a decline across the board, with the 30-year main contract dropping by 0.14%, the 10-year contract down by 0.03%, and the 5-year contract decreasing by 0.02% [4] Pharmaceutical E-commerce Sector - The A-share pharmaceutical e-commerce sector fell by 1%, with notable declines in stocks such as First Pharmaceutical down by 4.7% and Yibai Pharmaceutical down by 1.28% [5][6] - A new procurement platform rule in Guangdong province aims to unify drug pricing across the country, potentially impacting pharmacies and e-commerce platforms [7] Fast Food and Beverage Sector - Kuaishou's Q1 revenue increased by 10.9% year-on-year to 32.6 billion yuan, with an adjusted net profit of 4.6 billion yuan, reflecting a net profit margin of 14% [9][10] - The beverage manufacturing sector remained strong, with companies like Huaiqishan and New Dairy seeing significant gains [16] Autonomous Driving Sector - The autonomous driving sector continued to be active, with stocks like Tongda Electric and Yunnei Power seeing substantial increases [18] Nuclear Power Sector - Nuclear power stocks surged, with China National Nuclear Corporation International rising nearly 8% and China General Nuclear Power Corporation Mining up 7.43% [15]

Group 1 - The Hong Kong stock market has shown significant strength this year, with the Hang Seng Index and Hang Seng Tech Index both rising over 10% year-to-date, ranking among the top global market indices [2] - The Hong Kong Technology 30 ETF (513160) closely tracks the performance of mainland companies engaged in technology business and listed in Hong Kong, with notable gains in stocks like Kuaishou-W and Xiaomi Group-W [1][2] - Nearly 30% of the top 100 equity funds have a Hong Kong stock allocation exceeding 30%, with some funds reporting year-to-date net value increases of over 50% [2] Group 2 - Analysts suggest that the Hong Kong stock market has upward potential due to a favorable external environment and strengthening internal fundamentals, with three main investment themes: technology assets, consumer sectors supported by policy, and stable dividend-paying assets [3] - The sectors expected to benefit from policy support include automotive, consumption, electronics, and technology, as well as undervalued state-owned enterprises [2][3] - The market outlook remains positive, with expectations of continued capital inflow driven by multiple favorable factors [2]

Market Overview - The Hang Seng Index opened up 0.01%, while the Hang Seng Tech Index rose by 0.52%. Kuaishou increased by over 6%, and Xiaomi Group rose by over 2% [1] Capital Flow Analysis - Recent statistics from Guotai Junan International indicate that southbound funds have primarily flowed into the banking sector, with net inflows exceeding 16.5 billion HKD, while the information technology sector faced net outflows exceeding 20.5 billion HKD [2] - The strategy team noted that profit-taking in tech stocks is influenced by market behavior of "buying expectations, selling realities," alongside uncertainties regarding tariff prospects [2] Structural Changes in the Hong Kong Market - Sell-side institutions believe that the Hong Kong market is undergoing structural changes, with technology and consumer sectors now representing a significant portion of the market, shifting away from the previous dominance of finance and real estate [3] - Huatai Securities emphasizes the importance of strategic allocation in the Hong Kong market, highlighting that the market is well-positioned to attract long-term foreign capital [3] Valuation and Investment Opportunities - Morgan Stanley analysts suggest that the recent capital inflow is positively impacting the valuation recovery of Hong Kong assets, which still hold high allocation value in the medium to long term [4] - The Hang Seng Index's price-to-earnings ratio has increased from approximately 7.5 times to 10.5 times, aligning with the ten-year average, indicating room for further valuation recovery [4] IPO Market and Future Prospects - The Hong Kong IPO market is expected to see a significant revival in 2025, providing a crucial window for domestic companies to raise foreign capital [4] - The Hong Kong market is transitioning and presents substantial investment opportunities moving forward [4] Role of Hong Kong in Global Capital - The Hong Kong market is evolving into a key hub for global tech capital, connecting thriving mainland tech companies with international investors [5] - CITIC Securities reports that the influx of A-share companies going public in Hong Kong is driven by strategic overseas expansion, regulatory advantages, and improved liquidity [5] Government Support and Market Stability - The Hong Kong government has implemented several supportive policies for the stock market, including lowering stamp duties and optimizing trading mechanisms to enhance market liquidity and attractiveness [6] - The anticipated reform in dividend taxation, combined with improved international liquidity, is expected to make dividend strategies more appealing to long-term investors [6]

恒指高开0.01%，报23385.18点；恒生科技指数涨0.52%。快手财报过后涨6.5%，哔哩哔哩、小米涨超 2%；理想汽车跌1.6%，美团跌0.9%。 ...