2024-06-11 06:12Investment Rating - The report maintains a "Buy" rating for Meituan with a target price of HKD 131, up from the previous target of HKD 119 [3][6][4]. Core Insights - Meituan's Q1 performance exceeded market expectations, with total revenue growing 25% year-on-year to RMB 73.3 billion, surpassing market forecasts by 6% [3][11]. - The company's core local business and new business segments reported year-on-year growth of 27% and 19%, respectively, contributing RMB 54.6 billion and RMB 18.7 billion to total revenue [3][11]. - The adjusted net profit for Q1 was RMB 7.5 billion, exceeding market expectations by 29%, reflecting strong revenue performance and effective cost control [3][11]. Financial Data Summary - Total revenue for the fiscal year ending December 31, 2023, is projected to be RMB 276.7 billion, representing a 26% year-on-year growth [5]. - Adjusted net profit is expected to reach RMB 23.3 billion in 2023, with a net profit margin of 8.4% [5]. - The company anticipates a revenue increase of 21% in 2024, reaching RMB 334.0 billion, with adjusted net profit projected at RMB 36.1 billion [5]. Business Segment Performance - Delivery Services: Q1 saw a 23% year-on-year increase in daily order volume, averaging 51.6 million orders, with revenue growth slightly lagging due to a decrease in average order value [3][12]. - In-store and Travel Services: GTV grew over 60% year-on-year, with revenue expected to increase by 31%. The active user base rose by 37% year-on-year, indicating strong market demand [3][4][12]. - Flash Purchase: Daily order volume reached 8.4 million, benefiting from increased user engagement and higher average order values during holidays [3][12]. Profitability and Efficiency - The adjusted operating profit for the core local business was RMB 9.7 billion, with an operating margin of 17.8%, reflecting improved profitability [3][11]. - The new business segment reported an operating loss of RMB 2.8 billion, which is better than market expectations, indicating a narrowing loss trend [3][13]. Future Outlook - Revenue growth is expected to moderate in Q2, with a forecasted year-on-year increase of 18.5% [4]. - The company plans to focus on user retention and marketing efficiency to enhance profitability across its business segments [4][12].