MEITUAN(03690) 华泰证券·2024-10-11 13:03Investment Rating - The report maintains a "Buy" rating for Meituan-W (3690 HK) with a target price of HKD 235.6, up from the previous target of HKD 169.0 [2][7] Core Views - Policy tailwinds and consumption recovery are expected to boost Meituan's growth, with stronger profit elasticity anticipated [2] - Meituan's local life services leadership is expected to benefit from improved market confidence and operational efficiency [2] - The report forecasts 3Q24 revenue of RMB 92.1 billion (+21% YoY) and non-IFRS net profit of RMB 11.2 billion (+96% YoY) [2] - For 2024-2026, the report projects revenues of RMB 327.3/382.2/442.1 billion and non-IFRS net profits of RMB 40.2/58.8/75.2 billion [2] Business Segment Analysis Food Delivery Business - Meituan's food delivery business continues to deepen supply-side reforms, with 120 million users for its "Pinhaofan" service as of August 2024 [3] - New models like "satellite stores" and "collection stores" are helping merchants reduce costs and improve efficiency [3] - 3Q24 delivery orders are expected to reach 7.1 billion (+15% YoY), with food delivery orders at 6.1 billion (+12% YoY) [3] - Unit economics (UE) for food delivery is projected to improve to RMB 1.32 (from RMB 1.1 in 3Q23) [3] In-store Business - In-store GTV is expected to grow 30% YoY in 3Q24, driven by increased online penetration and category expansion [4] - Revenue from in-store services is projected to increase 23% YoY in 3Q24 [4] - Operating profit margin (OPM) for in-store business is forecasted at 36% for 3Q24 [4] New Initiatives - New business revenue is expected to grow 26% YoY in 3Q24 [5] - Meituan's self-operated Xiaoxiang supermarket is focusing on high-quality growth, with losses narrowing sequentially [5] - Overall operating loss for new businesses is projected to narrow to RMB 1.8 billion in 3Q24 [5] Financial Projections - Revenue growth is forecasted at 18.3%, 16.8%, and 15.7% for 2024-2026 respectively [6] - Net profit attributable to parent company is expected to grow 118.7%, 54.6%, and 31.2% for 2024-2026 [6] - ROE is projected to improve from 17.5% in 2024 to 21.8% in 2026 [6] - PE ratios are estimated at 26.4x, 18.1x, and 14.1x for 2024-2026 [2] Valuation - The target price of HKD 235.6 is based on a SOTP model, with valuations for different business segments [9][10] - Food delivery: HKD 125.0 (22x 2025E PE) - In-store: HKD 90.8 (24x 2025E PE) - New initiatives: HKD 19.8 (1.2x 2025E PS)