Investment Rating - The report maintains a "BUY" rating for PDD Holdings with a target price increase to USD 155.4, representing a 21.7% upside from the current price of USD 127.68 [11]. Core Insights - PDD Holdings reported a revenue increase of 123% YoY in 4Q23, reaching RMB 88.9 billion, which was 11% above Bloomberg consensus estimates. This growth is attributed to stronger international expansion and improved domestic monetization [11]. - Non-GAAP net profit for 4Q23 rose by 110% YoY to RMB 25.5 billion, exceeding consensus by 52%, driven by better domestic profit generation and a narrower loss from the Temu business [11]. - The company is expected to continue improving its monetization rate through increased commission rates in its "Ten Billion Subsidy" program and new advertising products [11]. - PDD's international expansion is on track to support long-term revenue and earnings growth, with adjustments made to account for rapid development in international business and domestic monetization improvements [11]. Financial Summary - Revenue projections for FY24E, FY25E, and FY26E are RMB 389.6 billion, RMB 492.4 billion, and RMB 540.1 billion respectively, reflecting significant growth rates of 57.3%, 26.4%, and 9.7% [3][14]. - Adjusted net profit estimates for FY24E, FY25E, and FY26E are RMB 91.7 billion, RMB 127.3 billion, and RMB 136.8 billion, indicating growth rates of 35.1%, 38.8%, and 7.5% [3][14]. - The company's gross profit margin is projected to be 62.5% in FY24E, slightly declining to 62.2% by FY26E [14]. Growth Metrics - PDD's revenue growth rates for FY22A, FY23A, FY24E, FY25E, and FY26E are 39.0%, 89.7%, 57.3%, 26.4%, and 9.7% respectively, showcasing a strong upward trend [8]. - The adjusted net profit growth rates for the same periods are 185.8%, 71.8%, 35.1%, 38.8%, and 7.5% [8]. Profitability Ratios - The gross profit margin for FY22A was 75.9%, expected to decrease to 62.5% in FY24E and further to 62.2% in FY26E [8]. - The operating margin is projected to be 23.4% in FY24E, increasing to 27.1% in FY25E before slightly declining to 26.8% in FY26E [8]. Valuation Metrics - The P/E ratio for FY24E is estimated at 14.8, decreasing to 10.5 by FY25E and further to 9.7 by FY26E, indicating a potentially attractive valuation [3][8].

Investment Rating - The report maintains a "BUY" rating for Kuaishou, with a target price of HK$97, implying an upside of 85.6% from the current price of HK$52.25 [2][3]. Core Insights - Kuaishou is expected to see margin improvement driven by gains in advertising and e-commerce. The company reported solid 4Q23 results, with revenue growth of 15% YoY and a net profit of RMB4.4 billion, which was 34% above consensus estimates [2][3]. - For FY24E, total revenue is projected to grow by 10.6% YoY, with specific segments showing varied performance: livestreaming revenue is expected to decline by 8%, while advertising and other services are forecasted to grow by 20% and 24% YoY, respectively [2][3]. - The adjusted net profit margin (NPM) improved to 13.4% in 4Q23, exceeding estimates, primarily due to a higher-than-expected gross profit margin (GPM) and reduced losses from overseas operations [2][3]. Financial Summary - Revenue for FY23A was RMB113.47 billion, with a YoY growth of 20.5%. For FY24E, revenue is expected to reach RMB125.54 billion, reflecting a growth of 10.6% [3][16]. - The adjusted net profit for FY23A was RMB10.27 billion, with projections for FY24E at RMB16.03 billion, indicating a significant growth of 56.1% YoY [3][16]. - The report highlights a projected GPM of 53.1% for FY24E, with an expected operating profit of RMB13.17 billion, marking a substantial recovery from previous losses [3][16]. Segment Performance - In 4Q23, the revenue breakdown showed online marketing services growing by 24% YoY, while live streaming remained flat at 0% growth. Other services and e-commerce saw significant growth of 36% and 31% YoY, respectively [2][7]. - For 1Q24E, advertising revenue is expected to increase by 26% YoY, while e-commerce GMV is projected to grow by 29% YoY, indicating strong momentum in these segments [2][3]. Valuation Metrics - The report provides a SOTP-based valuation, with the target price set at HK$97, based on a P/E ratio of 24x for FY24E and 17x for FY25E [2][3]. - The current market capitalization is reported at HK$2.27 billion, with a P/S ratio of 1.7 for FY24E, indicating a favorable valuation compared to historical performance [4][16].

Investment Rating - The report maintains a BUY rating for Kingdee with a target price of HK$15.50, reflecting a potential upside of 66.3% from the current price of HK$9.32 [4]. Core Insights - Kingdee reported a revenue of RMB5.7 billion for 2023, representing a 17% year-over-year growth, and a net loss of RMB210 million, which is a significant reduction from a loss of RMB389 million in 2022 [2][12]. - The company is well-positioned to benefit from the domestic substitution trend, supported by strong product capabilities and an enhanced partner ecosystem [2]. - The cloud segment contributed 79% of total revenue, with cloud revenue growing 21% year-over-year to RMB4.5 billion [2]. Financial Performance - Revenue growth is projected to continue with a compound annual growth rate (CAGR) of 15-20% from 2023 to 2026 [2]. - The annual recurring revenue (ARR) grew by 34% year-over-year, indicating a solid SaaS growth outlook for 2024 [2]. - Kingdee's core SaaS product, Galaxy, achieved revenue of RMB2.0 billion, up 16.3% year-over-year, with a stable dollar retention rate of 97.2% [2]. Business Segments - The Galaxy product line recorded over 39,000 customers by the end of 2023, with a net addition of over 8,000 customers year-over-year [2]. - The Cosmic & Constellation (C&C) segment saw a revenue increase of 40.9% year-over-year, and management expects revenue growth to reaccelerate in 2024 due to strong project pipelines [2]. Financial Guidance - Management has guided for a subscription ARR CAGR of 30% from 2023 to 2026 and aims for at least RMB900 million in operating cash flow in 2024, indicating a growth of at least 38% year-over-year [2].

Investment Rating - Maintain BUY rating for WuXi AppTec with a target price of RMB67.53, down from the previous target price of RMB116.01, indicating a potential upside of 32.9% from the current price of RMB50.81 [2][3]. Core Insights - WuXi AppTec reported a revenue of RMB40.3 billion in 2023, reflecting a year-on-year growth of 2.5%. The attributable recurring net income was RMB9.7 billion, up 16.8% YoY, and the attributable adjusted non-IFRS net income reached RMB10.9 billion, up 15.5% YoY. Excluding COVID-19 related revenue, the company achieved a remarkable revenue growth of 25.6% YoY [2][3]. - For 2024, management expects reported revenue to range between RMB38.3 billion and RMB40.5 billion, representing a decline of 5.1% YoY to growth of 0.4% YoY. Excluding COVID-19 related revenue, growth is anticipated to be between 2.7% and 8.6% YoY [2][3]. - The company has shown solid business development in 2023, particularly in TIDES revenue, which grew by 64.4% YoY, and drug safety assessment and SMO business, which grew by 27.3% and 26.1% YoY, respectively [2][3]. - WuXi AppTec is actively working on commercial projects and has started receiving royalty income in 2023, with several customers discussing long-term contracts for advanced-stage projects [2][3]. Financial Summary - Revenue for FY23 was RMB40,341 million, with a YoY growth of 2.5%. For FY24E, revenue is projected at RMB39,126 million, reflecting a decline of 3.0% YoY, followed by growth of 10.2% in FY25E and 11.1% in FY26E [3][8]. - Adjusted net profit for FY23 was RMB10,854 million, up 15.5% YoY, with projections of RMB10,260 million for FY24E (down 5.5% YoY), RMB11,364 million for FY25E (up 10.8% YoY), and RMB12,828 million for FY26E (up 12.9% YoY) [3][8]. - The company’s P/E ratio for FY23 was 13.7, with projections of 14.5 for FY24E, 13.1 for FY25E, and 11.6 for FY26E [3][8]. Shareholder Actions - WuXi AppTec has demonstrated confidence in its business by canceling RMB1.2 billion H-shares under its 2023 H-share Award Scheme and is in the process of repurchasing another RMB1 billion A-shares [2][3].

M N 20 Mar 2024 CMB International Global Markets | Equity Research | Company Update Akeso (9926 HK) Expect another fruitful year in 2024 In FY23, Akeso recorded RMB4.53bn in revenue, including RMB1.63bn from Target Price HK$59.61 product sales and RMB2.92bn from license income relevant to AK112 (PD- (Previous TP HK$51.23) 1/VEGF). Cadonilimab/AK104 (PD-1/CTLA-4) achieved RMB1.36bn in sales in Up/Downside 19.3% FY23, surpassing the Company’s initial guidance of RMB1.2-1.3bn. In 2H23, Current Price HK$49.95 A ...

Investment Rating - The report maintains a "BUY" rating for China Lilang with a target price raised to HK$5.75, reflecting a 29.2% upside from the current price of HK$4.45 [2][4]. Core Insights - China Lilang is expected to outperform in FY24E due to operational efficiency improvements and product quality upgrades, with a robust retail sales growth target of 15%, including 20% growth for e-commerce [2][6]. - The company reported FY23 results that slightly beat expectations, with sales and net profit increasing by 15% and 18% year-over-year, respectively [2][9]. - The report highlights a significant improvement in working capital, with inventory and receivable days reduced to 170 and 42 days, respectively [2][9]. Financial Performance - FY23 revenue was RMB 3,544 million, with a gross profit margin of 48.2% and a net profit of RMB 530 million, reflecting a year-over-year growth of 15% and 18% [3][9]. - For FY24E, revenue is projected to reach RMB 4,047 million, with a net profit of RMB 626 million, indicating a year-over-year growth of 14% [6][9]. - The company declared a dividend per share (DPS) of HK$0.36 for FY23, resulting in a payout ratio of 74% and an 8% yield based on the current market capitalization [2][4]. Segment Performance - Sales growth rates for key segments in FY23 were 10% for the core brand, 35% for smart casual, and 18% for e-commerce [2][9]. - The smart casual segment is expected to continue its rapid growth, with sales per store already exceeding that of the core brand [2][6]. Valuation Metrics - The report indicates a P/E ratio of 8x for FY24E, which is considered attractive compared to the target P/E of 10x [2][4]. - The projected sales and net profit CAGR for FY23-26E is 11% and 14%, respectively, supporting the valuation [2][6].

M N 21 Mar 2024 CMB International Global Markets | Equity Research | Company Update Huya (HUYA US) Margin improvement to continue Target Price US$6.80 Huya delivered upbeat 4Q23 results, with revenue 2% above consensus and adj. (Previous TP US$6.80) NPM at -12.4% (vs. consensus of -13.9%). Looking into FY24E, we suggest to focus Up/Downside +54.5% on its margin improvement and game monetization from more titles cooperation. We Current Price US$4.40 forecast stable topline YoY in FY24E, with advertising & ot ...

M N 21 Mar 2024 CMB International Global Markets | Equity Research | Company Update Geely Automobile (175 HK) Most businesses are trending up Target Price HK$14.00 Maintain BUY. We are of the view that Geely’s FY23 earnings quality was better (Previous TP HK$14.00) than FY21-22. We believe most of its businesses are poised to enjoy higher Up/Downside 58.6% profits in FY24E. Some investors may overlook Geely’s recent assets disposal Current Price HK$8.83 to ease its lingering D&A burden by leveraging its par ...

M N 20 Mar 2024 CMB International Global Markets | Equity Research | Company Update Xiaomi (1810 HK) Raise TP and estimates on 4Q23 beat; All eyes on EV official launch on 28 March Target Price HK$20.25 Xiaomi’s 4Q23 revenue/net profit of 11%/236% YoY growth beat our/consensus (Previous TP HK$19.54) estimates, driven by stronger margins, improving mix and investment gains. Up/Downside 36.3% Looking ahead, mgmt. is positive on smartphone recovery, premiumization Current Price HK$14.86 strategy and EV busines ...

M N 21 Mar 2024 CMB International Global Markets | Equity Research | Company Update Li Ning (2331 HK) Expectations reset with positive initiatives Target Price HK$24.86 We do find Li Ning’s FY23 results and FY24E guidance are inline, even though the views from the market are quite mixed. Anyhow, we do appreciate (Previous TP HK$32.93) management’s efforts to fix the bugsell and the branding power issues, as well Up/Downside 15.9% as resetting investors’ expectation with a prudent guidance. With all the prog ...