Investment Rating - The report maintains a "Buy" rating for the company, with a target price raised from $90 to $108, indicating a potential upside of 24.6% from the current price of $86.70 [3][4][12]. Core Insights - The company's earnings for Q3 2024 met market expectations, with a net profit of HKD 1.32 billion, reflecting a year-on-year growth of 21% and a quarter-on-quarter growth of 9%. Revenue increased by 30% year-on-year and 10% quarter-on-quarter, primarily driven by brokerage commission income [1][2]. - The brokerage commission income saw significant growth, with trading volume increasing by 75% year-on-year and 17% quarter-on-quarter, reaching the highest level since Q2 2021. The proportion of US stock trading volume rose to 80.5% [1][2]. - The company plans to distribute a special dividend of $2 per ADS, totaling $280 million, which represents 61% of the net profit attributable to shareholders for the first three quarters [2]. Financial Performance Summary - For the fiscal year ending December 31, 2024, the company is projected to achieve revenues of HKD 12.325 billion, a net profit of HKD 4.945 billion, and an EPS of HKD 35.57, reflecting a year-on-year growth of 15.6% [7][9][15]. - The average customer acquisition cost decreased by 6.7% quarter-on-quarter to HKD 2,037, while the customer asset scale approached HKD 700 billion, marking a year-on-year increase of 48% [2][8]. - Wealth management assets grew by 88% year-on-year to HKD 97.3 billion, with 27% of paying users holding wealth management products, up 2 percentage points from the previous quarter [2][8].

Investment Rating - The report maintains a **Buy** rating for Gaotu Techedu (GOTU US) with a target price of **$4.60**, representing a potential upside of **76.9%** from the current price of **$2.60** [1][4] Core Views - Gaotu Techedu's business restructuring and marketing strategy adjustments are expected to show results by **2025**, with potential cost savings of **RMB 100 million** from operational efficiency improvements [1][2] - The company's **K12 business** is expected to maintain a strong growth trajectory, with **70%+ YoY growth** in Q3 2024, driven by strong demand and effective student retention strategies [1] - The **adult education segment** is undergoing strategic downsizing, with revenue expected to remain flat in Q3 2024, a downgrade from the previously expected **10%+ growth**, resulting in a **RMB 30 million reduction** in revenue [1] - The company's **K9 business** is projected to grow by **150%+** in 2024, exceeding previous expectations, while the adult education segment is expected to see a **low single-digit decline** in Q4 2024 [2] - Despite strong revenue growth, the company is expected to face **operating losses** of **RMB 1.27 billion** in 2024, with a **loss margin of 28%**, due to increased marketing expenses and ongoing business adjustments [2] Financial Performance - **Revenue** is expected to grow by **50% YoY** in 2024, reaching **RMB 4.454 billion**, driven by strong performance in the K12 and K9 segments [2][3] - **Net loss** is projected to widen to **RMB 1.075 billion** in 2024, compared to a net profit of **RMB 51 million** in 2023, due to higher operating costs and business restructuring [3] - The company's **gross margin** is expected to decline to **64%** in Q3 2024, down **8 percentage points YoY**, primarily due to the impact of reduced revenue from the adult education segment [1] - By **2025**, the company expects to achieve a **profit margin** of **10-15%**, driven by improved operational efficiency and reduced marketing expenses [2] Valuation - The target price of **$4.60** is based on a **15x P/E ratio** for the online education business, reflecting the company's expected profitability recovery by 2025 [2] - The valuation has been adjusted downward from the previous target of **$6.50** due to ongoing business restructuring and increased marketing investments [2] Market Performance - Gaotu Techedu's stock has experienced a **28.18% decline** year-to-date, with a **52-week high of $8.35** and a **52-week low of $2.35** [6] - The company's **market capitalization** stands at **$386.10 million**, with an average daily trading volume of **0.67 million shares** [6]

Investment Rating - The report maintains a "Buy" rating for the company [4][3]. Core Insights - The company reported strong earnings growth, exceeding previous guidance, with a Non-GAAP net profit of 1.83 billion RMB for Q3 2024, representing a year-on-year increase of 54.5% and a quarter-on-quarter increase of 29.1% [1][2]. - The net income for Q3 2024 increased by 2.1% quarter-on-quarter and 5.1% year-on-year, driven by an increase in the take rate and a reversal of provisions [1][2]. - The company has set a Q4 2024 Non-GAAP net profit guidance of 1.8 to 1.9 billion RMB, indicating a year-on-year growth rate of 57-65%, suggesting that the total Non-GAAP net profit for 2024 will exceed 6.2 billion RMB, with a growth rate exceeding 40% [1][3]. Financial Performance - The company achieved a net take rate of 5.9% in Q3 2024, up from 5.2% in the previous quarter, benefiting from improved risk management and lower funding costs [2]. - The company’s loan facilitation increased by 13% quarter-on-quarter in Q3 2024, with a loan balance growth of 3% [2]. - The proportion of light asset models in ongoing loan facilitation reached 55.1%, reflecting a year-on-year increase of 10.3% [2]. Stock Performance and Valuation - The target price has been raised from $27.5 to $38.4, based on a 6.5x P/E ratio for 2024, indicating an attractive valuation [3][4]. - The company announced a stock repurchase plan of $450 million for 2025, enhancing shareholder returns [3].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 77.36, indicating a potential upside of 48.9% from the current price of HKD 51.95 [1][4][3]. Core Insights - The automotive gross margin exceeded expectations in Q3, with revenue reaching RMB 10.1 billion, a 24.5% increase quarter-on-quarter, and vehicle sales of 46,000 units, up 54.0% quarter-on-quarter [1]. - The company continues to benefit from ongoing revenue from partnerships, particularly with Volkswagen, and has maintained effective cost control, with R&D and sales expenses increasing slightly but decreasing as a percentage of revenue [1][2]. - The forecast for Q4 indicates total revenue between RMB 15.3 billion and RMB 16.2 billion, representing a year-on-year increase of approximately 17.2% to 24.1%, with vehicle deliveries expected to be between 87,000 and 91,000 units, a year-on-year increase of about 44.6% to 51.3% [2][3]. Financial Overview - Revenue projections for the company are as follows: RMB 30.7 billion in 2023, RMB 39.6 billion in 2024, RMB 61.2 billion in 2025, and RMB 67.7 billion in 2026, with respective year-on-year growth rates of 14.2%, 29.2%, 54.5%, and 10.5% [7]. - The company is expected to incur net losses of RMB 10.4 billion in 2023, RMB 4.8 billion in 2024, RMB 2.4 billion in 2025, and RMB 1.3 billion in 2026 [7]. - The gross margin is projected to improve, with a forecasted gross margin of 12.8% in 2024, 13.8% in 2025, and 14.7% in 2026 [14]. Market Position - The company has a significant backlog of nearly 100,000 orders for its popular models, which is expected to support sales in Q4 and Q1 of the following year [2][3]. - The report highlights that the pricing of vehicles has decreased, primarily due to a higher proportion of lower-priced models, yet the gross margin has shown signs of recovery [2][3]. Analyst Commentary - Analysts believe that the product strength and value proposition of the M03 and P7+ models will positively influence the sales of new models set to be released next year [3]. - The market has not yet fully priced in the potential sales boost from the upcoming extended-range models, suggesting there is still room for upward adjustments in sales forecasts for next year [3].

Investment Rating - The report maintains a "Buy" rating for the company with a target price adjusted to HKD 24.00, indicating a potential upside of 35.6% from the current price of HKD 17.70 [1][4][12]. Core Insights - The core OTA business is expected to grow faster than the industry average, with revenue projections of RMB 17.2 billion for 2024 and RMB 19.8 billion for 2025, reflecting growth rates of 19% and 16% respectively. The operating profit margin is anticipated to exceed 26%, leading to net profits of RMB 2.7 billion and RMB 3.4 billion for the respective years [1][2]. - The company reported a 51% year-on-year revenue increase in Q3 2024, reaching RMB 5 billion, which surpassed market expectations. The core OTA business revenue grew by 22%, driven by significant increases in both transportation and accommodation segments [2][3]. - The forecast for Q4 2024 anticipates a revenue increase of 29% to RMB 40.5 billion, with the core OTA segment expected to grow by 10% [2][9]. Financial Projections - Revenue forecasts for 2024 and 2025 have been slightly adjusted, with total revenue expected to be RMB 17.2 billion and RMB 19.8 billion respectively, reflecting growth rates of 44.2% and 15.7% [3]. - The adjusted operating profit margin is projected to improve to 16.3% for 2024 and 17.5% for 2025, with net profit margins expected to be 16.0% and 17.0% respectively [3][9]. - The company’s gross profit margin is forecasted to be 64.4% in 2024, slightly down from previous estimates, but still indicating strong profitability [3]. Market Performance - The stock has shown a year-to-date increase of 22.58%, with a market capitalization of approximately HKD 40.4 billion [6]. - The stock's 52-week high and low are HKD 22.30 and HKD 12.70 respectively, indicating significant volatility and potential for growth [6]. Summary of Earnings - The company achieved a net profit of RMB 9.1 billion in Q3 2024, a 47% increase year-on-year, exceeding market expectations by 11% [2][3]. - The operational efficiency is improving, with marketing expenses as a percentage of revenue decreasing to 29%, which is better than the anticipated 33% [2]. Conclusion - The report indicates a positive outlook for the company, driven by strong growth in the core OTA business, improved operational efficiency, and favorable market conditions, supporting the "Buy" rating and the revised target price [1][4][12].

Investment Rating - The report maintains a **Buy** rating for Kingsoft Corporation (3888 HK) with a target price of HKD 33 00, implying a potential upside of 13 0% from the current closing price of HKD 29 20 [1][4] Core Views - Kingsoft's Q3 2024 performance exceeded expectations, driven by strong growth in gaming revenue, with total revenue increasing by 42% YoY to RMB 2 92 billion and adjusted operating profit surging by 168% YoY to RMB 1 20 billion [1] - The gaming segment saw a significant YoY/QoQ growth of 78%/33%, primarily due to the success of *JX3: Infinite* and the October update for *JX3*, which boosted user engagement and revenue [2] - WPS revenue grew by 10% YoY, with personal subscriptions increasing by 17% YoY, while B2B SaaS transformation impacts are gradually diminishing [2] - The report forecasts a 30% YoY growth in gaming revenue for 2024, with new game releases in 2025 expected to sustain healthy growth trends [2] - WPS is expected to focus on AI+ collaboration, with AI product upgrades and feature optimizations enhancing user stickiness and paid conversions [2] Financial Model Updates - Revenue forecasts for 2024E, 2025E, and 2026E have been revised upwards by 6%, 7%, and 6% respectively, with gaming revenue expected to grow by 13%, 16%, and 14% over the same periods [3] - Adjusted operating profit margins are projected to improve, reaching 35%, 36%, and 37% for 2024E, 2025E, and 2026E respectively [3] - Adjusted net profit margins are expected to rise to 26%, 24%, and 25% for 2024E, 2025E, and 2026E, reflecting strong profitability [3] Industry and Peer Comparison - Kingsoft is categorized under the gaming sector, with peers such as Tencent Holdings (700 HK) and NetEase (NTES US) also holding Buy ratings [11] - The report covers a broad range of internet and education companies, with notable Buy ratings for companies like Baidu (BIDU US), Bilibili (BILI US), and Pinduoduo (PDD US) [11] Financial Performance Overview - Kingsoft's Q3 2024 revenue reached RMB 2 92 billion, with gaming and other business revenue contributing RMB 1 71 billion, up 78% YoY, and WPS revenue at RMB 1 21 billion, up 10% YoY [6] - Adjusted operating profit for Q3 2024 stood at RMB 1 20 billion, with an operating margin of 41%, up 19 percentage points YoY [6] - The company's gross margin improved to 84% in Q3 2024, up 3 percentage points YoY, driven by higher gaming revenue and operational efficiencies [6]

Investment Rating - The report maintains a "Buy" rating for the company [4][3]. Core Views - The company is expected to benefit from improved risk indicators and an acceleration in loan facilitation growth, with a projected 11% quarter-on-quarter profit growth in Q4 2024 [3]. - The target price has been raised from $6.30 to $7.20, indicating a potential upside of 19.4% [3][10]. Summary by Sections Financial Performance - In Q3 2024, the company's net profit attributable to shareholders reached 624 million RMB, marking a 10% year-on-year increase and a 13% quarter-on-quarter increase [1]. - The net income for Q3 grew by 2.5% year-on-year and 3.4% quarter-on-quarter, while expenses increased by 2.7% year-on-year and 4.1% quarter-on-quarter [1]. Loan Facilitation Growth - Loan facilitation in Q3 grew by 1.8% year-on-year, with domestic and international markets growing by 0.8% and 22% respectively [2]. - The company maintains its annual guidance for loan facilitation growth at 5-10% for the domestic market and 20-40% for the international market [2]. International Business Expansion - The international business accounted for 5.2% of loan facilitation in Q3, with revenue contribution rising to 19.4%, up 1.1 percentage points year-on-year [2]. - The company aims for international business to represent 50% of revenue by 2030 [2]. Risk Indicators - The 90-day delinquency rate improved to 2.5%, a decrease of 15 basis points quarter-on-quarter, while the collection rate increased to 88.5%, up 50 basis points [2]. Financial Projections - The company forecasts a 2.3% year-on-year profit growth in 2024, with net income expected to reach 2,394 million RMB [7]. - The projected revenue for 2024 is 13,019 million RMB, reflecting a 3.8% year-on-year growth [7].

Investment Rating - The report maintains a "Buy" rating for the company, Trip.com Group (9961 HK), with a target price raised to HKD 605.00, indicating a potential upside of 26.5% from the current price of HKD 478.20 [1][5][12]. Core Insights - The company's hotel business has performed better than expected, and the transportation segment is returning to normal growth, leading to an upward revision of revenue forecasts for 2024 and 2025 by 4% and 6% respectively. Trip.com is expected to continue contributing to revenue growth, with manageable investments and losses [1][2]. - The company reported a revenue of RMB 15.9 billion for Q3 2024, a year-on-year increase of 16%, surpassing market expectations. The growth was driven by accommodation (+22%), transportation (+5%), vacation (+17%), and business travel (+11%) segments [2][6]. - Adjusted net profit for Q3 2024 reached RMB 6 billion, a 22% increase year-on-year, exceeding expectations due to optimized cross-selling and effective cost control [2][6]. Financial Forecasts - Total revenue projections for 2024E have been updated to RMB 52.93 billion, reflecting an 18.8% growth rate, while 2025E revenue is forecasted at RMB 60.6 billion, a 14.5% growth rate [4][17]. - The adjusted operating profit for 2024E is expected to be RMB 16.08 billion, with an operating profit margin of 30.4% [4][17]. - The adjusted net profit for 2024E is projected at RMB 17.84 billion, with a net profit margin of 33.7% [4][17]. Performance Metrics - The company has shown a strong recovery in its hotel and transportation segments, with the average daily rate (ADR) pressure easing and outbound travel bookings recovering to 120% of 2019 levels [2][6]. - Marketing expenses have increased by 23% year-on-year, but remain stable as a percentage of revenue at 21% [2][6]. - The company’s gross profit margin is projected to be 81.5% for 2024E, slightly down from 81.7% in the previous forecast [4][17].

Investment Rating - The report maintains a "Buy" rating for Alibaba (BABA US) with a target price of $111.00, indicating a potential upside of 25.3% from the current price of $88.59 [1][5]. Core Insights - Alibaba's e-commerce segment has shown a recovery with double-digit growth in order volume, and there are optimistic long-term opportunities for improving monetization rates [1][2]. - The company reported total revenue of 236.5 billion RMB for the second quarter of FY2025, reflecting a year-on-year increase of 5.2%, aligning closely with market expectations [1][6]. - Adjusted earnings per share (EPS) for the quarter were 15.06 RMB, a decrease of 4% year-on-year, slightly below expectations [1][6]. Summary by Sections Performance Highlights - Taobao's order volume increased by double digits year-on-year, with a stable conversion rate [2]. - International business revenue grew by 29% year-on-year, driven by AliExpress and Trendyol [2]. - Cloud revenue accelerated with a 7% year-on-year increase, supported by public cloud and AI-related products [2]. - Local services saw a 14% revenue increase, with significant growth in orders from Ele.me and Gaode [2]. Future Outlook - The report anticipates an overall revenue growth of 8.6% for the December quarter, with adjusted EBITA expected to reach approximately 573 billion RMB, a year-on-year increase of 8% [3]. - The report highlights the potential for long-term improvement in monetization rates, supported by increased user engagement and the integration with WeChat [3]. Valuation - The current price corresponds to a 10x price-to-earnings ratio for the calendar year 2025, which is considered attractive [3]. - The target price is based on a 13x price-to-earnings ratio for the same period, reinforcing the "Buy" recommendation [3]. Financial Projections - Revenue projections for the fiscal years 2024 to 2027 show a steady growth trajectory, with expected revenues of 941.2 billion RMB in FY2025 and 1,187.1 billion RMB in FY2027 [4]. - Net profit is projected to reach 180.7 billion RMB by FY2027, with an EPS of 77.96 RMB [4]. Segment Performance Forecast - The report provides detailed forecasts for various segments, indicating growth in e-commerce, cloud services, and local life services, while also addressing challenges in profitability for certain divisions [10][12].

Investment Rating - The report assigns a "Neutral" rating to the company with a target price of HKD 5.80, indicating a potential upside of 13.0% from the current closing price of HKD 5.13 [1][4][9]. Core Insights - The company experienced significant pressure in its business segments during Q3 2024, with revenues and net profits declining by 17.8% and 50.4% respectively. The decline was attributed to various factors, including a 20% drop in the pharmaceutical segment, particularly a 31% decrease in the oncology sector due to competitive pricing pressures and inventory adjustments [1][2]. - The management anticipates a recovery in 2025, driven by the launch of six new products by the end of 2024, which is expected to restore positive growth in operating income outside of business development (BD) [1][2]. - The company has entered a significant business development phase, with a global rights deal for an Lp(a) inhibitor with AstraZeneca potentially worth up to USD 1.65 billion, including a USD 100 million upfront payment expected to be recognized in Q4 2024 [2][5]. Financial Model Updates - Revenue forecasts for 2024-2026 have been adjusted downward by 17-26%, and net profit forecasts have been reduced by 28-37% due to the disappointing Q3 performance [2][3]. - The updated financial projections indicate a revenue of RMB 29,632 million for 2024, down from the previous estimate of RMB 35,518 million, with a corresponding net profit of RMB 4,966 million, reflecting a significant decrease from the prior forecast [3][11]. Business Development Potential - The company is expected to generate at least two external licensing deals annually, with the potential for each deal to exceed the scale of the AstraZeneca transaction. This includes ongoing development in various innovative platforms such as ADC, siRNA, and mRNA vaccines [2][5]. - The management is actively exploring collaborations in early product development with AI drug discovery and gene therapy technologies, indicating a strategic focus on innovation and partnerships [2][5].