MEITUAN(03690) 光大证券·2024-12-01 08:03Investment Rating - The report maintains a "Buy" rating for Meituan-W (3690 HK) with a target price of HKD 168 70 [1] Core Views - Meituan's 3Q2024 performance exceeded expectations driven by improved profitability in core businesses and significant reduction in losses from new businesses [1] - The company's 3Q2024 revenue grew by 22 38% YoY while adjusted net profit surged by 124 00% YoY [1] - Meituan's gross margin increased by 3 99 percentage points and the expense ratio decreased by 4 73 percentage points in 3Q2024 [1] - The company's core local commerce segment saw a 20 25% YoY revenue growth with a 44 44% YoY increase in operating profit [3] - Meituan's new business segment revenue grew by 28 91% YoY although it still reported an operating loss [3] Financial Performance - Meituan's 1-3Q2024 revenue reached RMB 295 85 billion a 22 68% YoY increase with adjusted net profit of RMB 339 24 billion up 154 19% YoY [1] - In 3Q2024 Meituan's revenue was RMB 935 77 billion a 22 38% YoY increase with adjusted net profit of RMB 128 29 billion [1] - The company's gross margin for 1-3Q2024 was 38 67% up 3 12 percentage points YoY while the 3Q2024 gross margin was 39 28% [1] - Meituan's expense ratio for 1-3Q2024 was 28 49% down 3 72 percentage points YoY with the 3Q2024 expense ratio at 28 11% [1] Business Segment Analysis - Meituan's core local commerce segment contributed RMB 69 37 billion in revenue with a 21 02% operating margin in 3Q2024 [3] - Delivery services accounted for 40 05% of core local commerce revenue growing 20 89% YoY while commission income grew 24 27% YoY [3] - Meituan's instant delivery orders increased by 14 5% YoY in 3Q2024 reaching 7 078 billion orders [1] - The company's in-store hotel and travel business saw order volume grow over 50% YoY in 3Q2024 [1] Future Outlook - The report raises Meituan's 2024 2025 and 2026 adjusted net profit forecasts by 18% 7% and 4% respectively to RMB 49 07 billion RMB 54 99 billion and RMB 65 13 billion [1] - Meituan's core competitive barriers remain solid with continued improvement in profitability [1] - The company may increase investment in its overseas Keeta business although core business profitability still has room for improvement [1]