Core Viewpoint - Meituan-W (03690) experienced a significant stock price increase, rising nearly 7% in early trading, with a current price of 104 HKD and a trading volume of 7.823 billion HKD [1] Group 1: Company Developments - Alibaba Group's CFO Xu Hong announced during the Q3 earnings call that investments in Taobao Flash Sales will peak in the September quarter, indicating a potential "temporary truce" in competitive spending [1] - Meituan plans to hold a board meeting on November 28 to approve quarterly results, with expectations that Meituan's food delivery business losses will peak in the current quarter [1] Group 2: Market Analysis - Analysts from CITIC Securities predict that competition in the food delivery sector has eased since Q4, leading to a rationalization of subsidies and a recovery in Meituan's market share in food delivery [1] - Long-term prospects for Meituan's food delivery business overseas are promising, with potential for significant profit growth, which could enhance Meituan's valuation flexibility [1]

中午时分的迪拜商圈，附近停满了挂着各色外卖箱的摩托车。红、黄、蓝、绿——每个颜色背后，都代 表一个试图在这片热土上站稳脚跟的外卖平台。 尽管这里还没有实现"外卖自由"，但外卖已经在逐渐融入迪拜人的生活。在核心商圈附近开了中餐厅的 商家王婷（化名）对第一财经记者表示，她来到迪拜已有5年，在2年前开了餐厅。随着迪拜的外卖平台 逐渐增加，王婷的餐厅也入驻了多个平台，包括Talabat、Noon、COME COME以及美团旗下出海的外 卖平台Keeta。 虽然迪拜的外卖业属于蓝海市场，但当地的文化、消费习惯仍对来自海外的平台带来了挑战。来自中国 的美团旗下Keeta，正试图用"免佣金"和"中国速度"，撬动一个尚未被完全唤醒的外卖市场。 作者 | 第一财经 陆涵之 尚未实现外卖自由 迪拜的外卖生态与中国有许多不同。例如，很多骑手并非本地人，多来自南亚，包括印度、斯里兰卡、 孟加拉国等。他们不像国内同行那样熟练地"批量接单配送"分秒必争，将效率提高到极致——在迪拜， 常见的模式是"一单一送"。这种模式直接影响着整体效率和运力稳定性。 此外，当地的小哥运力没有国内充足。王婷表示，"我们出餐后偶尔会等骑手等很久。"最久的一次 ...

Core Viewpoint - The company expects Meituan's revenue for Q3 2025 to be 97.8 billion yuan, with a year-over-year growth of 4.5%, while operating profit is projected to be -18.5 billion yuan and adjusted net profit at -15.9 billion yuan, primarily due to intense competition in the food delivery subsidy market [1] Delivery Business - In Q3 2025, Meituan's instant delivery order volume is expected to grow by 17.0% year-over-year, and food delivery order volume is projected to increase by 14.3%, driven by enhanced platform subsidies [2] - However, the intense subsidy competition in Q3 has led to a significant decline in Meituan's user experience (UE), with expectations of UE dropping to -2.8 yuan, compared to 1.48 yuan in Q3 2024 and -0.21 yuan in Q2 2025 [2] - The company anticipates a return to rational operations in Q4, which may alleviate the ongoing subsidy competition [2] Dining and Travel Business - Meituan's dining and travel business revenue is expected to grow by 5% year-over-year in Q3 2025, although there is pressure on offline dining consumption due to increased food delivery subsidies [2] - The operating profit margin (OPM) for the dining segment is projected to reach 27.8%, reflecting a decline of 5.7 and 5.2 percentage points compared to previous quarters, attributed to a higher proportion of revenue from lower-tier cities and increased subsidy investments [2] New Business Initiatives - New business revenue is expected to reach 28.4 billion yuan in Q3 2025, with a year-over-year growth of 17.5%, although the operating loss is projected at 2.4 billion yuan [3] - The company is expanding its Xiaoxiang supermarket brand in response to the instant retail trend, leveraging supply chain and brand advantages for competitive growth [3] - Meituan's international food delivery expansion is progressing steadily, with plans to enter the Brazilian market in Q4, indicating long-term potential for growth [3] Financial Forecast and Valuation - Revenue forecasts for 2025-2027 are set at 376.8 billion, 444.8 billion, and 510.2 billion yuan, with adjusted net profits projected at -7.9 billion, 35.4 billion, and 54.4 billion yuan, respectively [3] - The company maintains its valuation despite rising valuations of comparable companies, emphasizing the unsustainable nature of current subsidy competition [4] - A target price of 136.0 Hong Kong dollars is set for Meituan, with a "buy" rating maintained [4]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 136.00 [7]. Core Insights - The company is expected to face significant pressure on revenue growth and profits in Q3 2025 due to intense competition in the food delivery sector, particularly from irrational subsidies [1][2]. - Despite short-term challenges, the report remains optimistic about the company's long-term efficiency advantages and brand strength, anticipating a return to rational operations in Q4 2025 [1][5]. - The company is also making progress in its overseas food delivery business, with plans to expand into the Brazilian market [4]. Revenue and Profit Forecast - For Q3 2025, the company is projected to generate revenue of RMB 978 billion, representing a year-over-year growth of 4.5%, but with an expected operating loss of RMB 18.5 billion and an adjusted net loss of RMB 15.9 billion [1][5]. - The report forecasts revenues of RMB 3,768 billion, RMB 4,448 billion, and RMB 5,102 billion for the years 2025, 2026, and 2027 respectively, with adjusted net profits of RMB -79 billion, RMB 354 billion, and RMB 544 billion [5][10]. Business Segments Performance - The instant delivery segment is expected to see a year-over-year order volume increase of 17.0% in Q3 2025, driven by increased platform subsidies, although user experience (UE) is projected to decline significantly [2]. - The dine-in segment is anticipated to grow by 5% year-over-year in Q3 2025, but faces pressure from offline dining consumption and increased competition from delivery services [3]. - New business revenue is expected to reach RMB 284 billion in Q3 2025, with a year-over-year growth of 17.5%, although it will incur an operating loss of RMB 2.4 billion [4]. Valuation Metrics - The report provides a sum-of-the-parts (SOTP) valuation, assigning PE multiples of 7x for the food delivery business and 18x for the dine-in business for 2026, with a target price of HKD 136.00 per share [5][14]. - The company’s estimated PE ratios for 2025, 2026, and 2027 are projected to be 13.00, 15.85, and 10.31 respectively [10][24].

Core Viewpoint - Meituan is facing significant challenges in both domestic and international markets, particularly in Brazil, where it is competing against Didi's 99Food in a rapidly growing e-commerce environment [1][4][14] Group 1: Domestic Market Challenges - In Q2 2025, Meituan reported a nearly 90% drop in adjusted net profit, earning 12.1 billion yuan less than the same period last year, attributed to irrational competition [1] - Meituan's market share in the domestic food delivery sector fell from 74% at the beginning of the year to 65% by August [1] - The company increased its sales and marketing expenses by 7.7 billion yuan compared to the previous year due to the fierce competition [1] Group 2: International Expansion and Competition - Meituan is entering the Brazilian market with its new brand Keeta, planning to invest $1 billion over the next five years [4] - The Brazilian market is seen as a fertile ground for food delivery services due to its high urbanization rate (87.6%) and a projected market size of $12 billion [1][5] - Didi's 99Food previously exited Brazil due to iFood's dominance but has re-entered the market, intensifying competition [2][4] Group 3: Legal Disputes - Meituan's Keeta has initiated legal actions against 99Food for trademark infringement and unfair competition practices [3] - The lawsuits include accusations of 99Food's high-priced advertising tactics and exclusive agreements with merchants [3] Group 4: Market Potential and Infrastructure - Brazil's Q-commerce market is projected to reach approximately $1.05 billion by 2024, with a compound annual growth rate of about 11.45% [5] - The CEP (courier, express, and parcel) market in Brazil is expected to grow from $5.93 billion in 2025 to $7.77 billion by 2030, with a CAGR of 5.56% [5] - Brazil's internet penetration rate is high, with over 90% smartphone ownership, indicating a strong potential for on-demand delivery services [5][6] Group 5: Competitive Strategies - Didi's 99Food has proposed a "fair alternative" plan, including waiving commissions for restaurants for a year and guaranteeing daily income for delivery riders [8] - Meituan's Keeta plans to offer lower rates than iFood and provide incentives for timely deliveries [8] - Both companies are engaging in aggressive spending to capture market share in a highly competitive environment dominated by iFood, which holds over 80% of the market [8][12]

Investment Rating - The report maintains a "Buy" rating for the industry [2] Core Insights - The Middle East and Brazil exhibit significant population dividends, with the food delivery market size continuing to grow [2][3] - The penetration rate and ARPU (Average Revenue Per User) are driving steady growth in the food delivery market in these regions [2][3] - Keeta's entry into the Middle East and Brazil is supported by favorable policies and a strong local market presence [2][3][4] Summary by Sections 1. Market Growth in the Middle East and Brazil - The food delivery market in Saudi Arabia is projected to reach 10.78 billion USD in 2024, growing by 17.8% year-on-year, with user numbers reaching 21.2 million, a 15.2% increase [2][31] - The GCC's food delivery market is expected to exceed 16.5 billion USD in 2024, with a year-on-year growth of 14.3% [2][31] - Brazil's online food delivery market is anticipated to reach 18.6 billion USD in 2024, with a growth rate of 16.9% [2][39] 2. Competitive Landscape in the Middle East and Brazil - In the Middle East, Jahez and HungerStation dominate the Saudi market, holding approximately 70% market share [3][46] - Keeta, a subsidiary of Meituan, entered the Saudi market in 2024 and aims to capture market share through aggressive subsidies and a low commission model [3][4] - In Brazil, iFood leads the market with an 80% share, while Aaiqfome focuses on smaller cities to avoid direct competition [4][56] 3. Keeta's Strategy and Potential for Replication - Keeta's success in Hong Kong is attributed to its localized strategies and technological innovations, which may be replicable in overseas markets [5][6] - The company has implemented a "one billion rewards" subsidy plan to attract price-sensitive users and has optimized its delivery efficiency [5][6] 4. Profitability Potential in Overseas Markets - The report estimates that the overseas profit potential for Keeta in the Middle East and Brazil could exceed 10 billion USD [6][7] - Current profit margins for local platforms in the Middle East suggest a favorable environment for Keeta's expansion [6][7] 5. Policy Support for Market Expansion - Saudi Arabia's Vision 2030 emphasizes economic diversification and digital transformation, providing a conducive environment for foreign investment in food delivery services [2][44] - The government is actively promoting digital services through tax incentives and infrastructure investments, which benefit companies like Keeta [2][44]