Investment Rating - The report assigns a "Buy" rating to Meitu Inc (1357 HK) with a target price of HKD 4 42 [1][2] Core Views - Meitu Inc is a leading player in the aesthetic tools sector with a comprehensive product matrix covering image video and design solutions The company has successfully transitioned to a subscription-based business model which has become the core driver of revenue growth [1] - AI technology is empowering both ToB and ToC businesses with significant room for growth in subscription payment rates The company's MiracleVision visual model supports its productivity tools and has been integrated into workflows across various industries [1][27] - The company's beauty industry solutions including Meide and Meitu Yifu are experiencing rapid revenue growth and contributing to the digital transformation of the industry [1][37] Market Data - Total shares outstanding 4 478 billion Total market cap HKD 16 165 billion [1] - 1-year low high HKD 1 74-4 19 3-month turnover rate 162 8% [1] - 1-month 3-month 1-year relative returns 39 7% -2 8% 55 0% absolute returns 42 1% -1 4% 40 7% [1] Product Matrix - Image and design products include Meitu Xiuxiu Meiyan Camera Wink and Meitu Design Studio These products have maintained a leading position in the image editing sector with Meitu Xiuxiu holding a 54% MAU market share as of January 2024 [1][11] - Beauty industry solutions include Meide and Meitu Yifu which provide ERP and supply chain management SaaS solutions for cosmetics retailers and AI skin analysis for beauty brands and salons [1][11] Financial Performance - Revenue for 2023 reached RMB 2 696 billion a 29 3% YoY increase Adjusted net profit was RMB 368 million a 233 2% YoY increase [1][14] - The company expects revenue to grow to RMB 3 594 billion in 2024 RMB 4 436 billion in 2025 and RMB 5 162 billion in 2026 with adjusted net profit reaching RMB 590 million RMB 798 million and RMB 979 million respectively [1][14] AI and Subscription Growth - The company's subscription user base grew from 5 62 million in December 2022 to 9 11 million in December 2023 with the subscription payment rate increasing from 2 3% to 3 7% [1][26] - AI-driven features such as AI expansion and AI-generated content (AIGC) have significantly contributed to the growth in subscription rates [1][26] Industry Outlook - The image and design industry is expected to grow significantly driven by AI technology and increasing demand from both C-end and B-end users The market size for image digitization in China is projected to reach nearly RMB 16 billion by 2025 [1][20] Valuation - The report values Meitu Inc at 5x PS for 2024 resulting in a target market cap of HKD 19 78 billion and a target price of HKD 4 42 [1][47]
首次覆盖报告：美学工具领军者，AI赋能生产力场景