Guohai Securities·2024-05-26 03:31Investment Rating - The report maintains a "Buy" rating for Kuaishou-W (1024.HK) [1] Core Views - Kuaishou demonstrates strong profitability improvement and continues to enhance shareholder returns, with a focus on user growth strategies and algorithm optimization [1][4] - The company has announced a stock repurchase plan, indicating optimism about future growth prospects and commitment to shareholder value [6] Summary by Sections Operational Performance - In Q1 2024, Kuaishou's platform user base showed steady growth, with MAU reaching 697 million and DAU at 394 million, maintaining high user engagement with an average daily usage time of 129.5 minutes [3][4] - Total user usage time in Q1 2024 increased by 8.6% year-on-year [3] Financial Performance - Kuaishou reported Q1 2024 revenue of 29.408 billion RMB, a year-on-year increase of 16.6% but a quarter-on-quarter decrease of 9.7% [4][6] - The gross margin improved to 54.8%, up 8.4 percentage points year-on-year [4] - Adjusted net profit reached 4.388 billion RMB, significantly better than market expectations, with an adjusted net profit margin of 15%, up 14.7 percentage points year-on-year [4][6] Business Segments - Live Streaming: Revenue from live streaming in Q1 2024 was 8.6 billion RMB, down 8% year-on-year and 14.7% quarter-on-quarter, as the company focuses on building a sustainable live streaming ecosystem [5] - Online Marketing Services: Revenue from online marketing services grew by 27.4% year-on-year to 16.7 billion RMB, with strong growth in both internal and external advertising [5] - Other Businesses: Other business revenue increased by 47.6% year-on-year to 4.2 billion RMB, with e-commerce GMV growing by 28.2% to 288.1 billion RMB [5] Profitability Forecast - The report projects Kuaishou's revenue for FY2024-2026 to be 128.2 billion, 146.0 billion, and 163.6 billion RMB respectively, with adjusted net profits of 19.2 billion, 27.6 billion, and 35.0 billion RMB [6][10] - The target price is set at 74 to 82 HKD, with a projected market value of 321.9 billion RMB for 2024 [6]