Minsheng Securities·2024-03-20 16:00Investment Rating - The report maintains a "Buy" rating for the company [2][3]. Core Insights - The company reported a total revenue of 32.6 billion RMB for Q4 2023, representing a year-over-year increase of 15.1%. Net profit reached 3.6 billion RMB, marking a return to profitability [2]. - The user ecosystem remains robust, with Monthly Active Users (MAU) surpassing 700 million. Daily Active Users (DAU) reached 382.5 million, showing a year-over-year growth of 4.5% [2]. - Revenue growth was driven by online marketing services and e-commerce, with online marketing service revenue at 18.2 billion RMB, up 20.6% year-over-year, and e-commerce revenue growing over 40% year-over-year, achieving a Gross Merchandise Volume (GMV) of 403.9 billion RMB [2]. - Profitability exceeded expectations, with a gross margin of 53.1%, an increase of 7.6 percentage points year-over-year, and a net profit margin of 11.1% [2]. - Overseas revenue saw significant growth, with a year-over-year increase of 197.5%, while domestic revenue grew by 13.2% [2]. - The company forecasts Non-IFRS net profits of 16.5 billion RMB, 23 billion RMB, and 28.8 billion RMB for 2024, 2025, and 2026 respectively, with corresponding P/E ratios of 16X, 11X, and 8X [2]. Summary by Sections Financial Performance - Q4 2023 total revenue: 32.6 billion RMB, up 15.1% year-over-year - Q4 2023 net profit: 3.6 billion RMB, returning to profitability - Adjusted net profit: 4.4 billion RMB [2]. User Metrics - Q4 2023 DAU: 382.5 million, up 4.5% year-over-year - Q4 2023 MAU: 700.4 million, up 9.4% year-over-year - Daily average user engagement: 124.5 minutes [2]. Revenue Breakdown - Online marketing service revenue: 18.2 billion RMB, up 20.6% year-over-year - E-commerce revenue: over 40% growth year-over-year, GMV of 403.9 billion RMB, up 29.3% year-over-year - Live streaming revenue: 10 billion RMB, up 0.1% year-over-year [2]. Profitability Metrics - Q4 2023 gross margin: 53.1%, up 7.6 percentage points year-over-year - Q4 2023 net profit margin: 11.1%, adjusted net profit margin: 13.4% [2]. Future Projections - Expected Non-IFRS net profits for 2024, 2025, and 2026: 16.5 billion RMB, 23 billion RMB, and 28.8 billion RMB respectively - Corresponding P/E ratios: 16X, 11X, and 8X [2].