Orient Securities·2024-10-16 10:03Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 60.47 per share [1][6][2] Core Views - The company is expected to see a steady increase in daily active users (DAU) and user engagement due to the integration of content and commercial resources, as well as the broadcasting effect of the Paris Olympics [1] - E-commerce GMV is projected to grow by 15% year-on-year to CNY 333.8 billion in Q3 2024, driven by promotional events [1] - Advertising revenue is anticipated to grow by 20.2% year-on-year to CNY 17.66 billion in Q3 2024, with internal advertising growth outpacing GMV growth [1] - The live streaming business is expected to see a decline in revenue by 4.7% year-on-year to CNY 9.26 billion in Q3 2024 [1] - The company aims to optimize its revenue structure and improve operational efficiency, with an expected gross margin of 53.8% in Q3 2024 [1] - The commercialization of AI models is progressing rapidly, with significant improvements in quality and functionality [1] Financial Projections - The adjusted net profit for 2024 is projected to be CNY 170.05 billion, with a PE valuation of 14x, leading to a reasonable market value of CNY 2,381 billion, equivalent to HKD 2,610 billion [2][6][7] - Revenue for FY2024 is expected to reach CNY 126.5 billion, with a year-on-year growth of 11.5% [5] - The company anticipates a net profit margin of approximately 12.5% for Q3 2024, with an adjusted net profit of around CNY 39 billion [1]