Core Viewpoint - Oriental Securities believes that Meitu's (01357) AI features and creative gameplay are frequently iterating, enhancing its global aesthetic appeal, and that the company will continue to benefit from improvements in foundational technology and AI gameplay development efficiency. The firm maintains a "Buy" rating with a target price of HKD 13.33, highlighting the unique value and growth prospects of Meitu's vertical applications [1]. Group 1: Lifestyle Scene - AI features are frequently updated, with global performance proving strong, and the sustainability of aesthetic and creative output is validated. As of October 2025, Meitu Xiuxiu has launched 51 new features, nearing the 55 new features launched in 2024, with AI features (excluding collage and cropping) accounting for nearly 96% (up from 78% in 2024) [2]. - The company's sensitivity to common trends and refined local operations strategies have increased the probability of new features gaining global traction. For instance, in October, the "AI Group Photo" feature topped the iOS download charts in 14 European countries and 30 country category charts, while in November, the "AI Snow Scene" feature topped the overall app store charts in 29 countries and regions, including Germany, Turkey, and South Korea [2]. Group 2: Productivity Scene - Attention is focused on the progress of Meitu Design Studio's collaboration with Alibaba. The Meitu Design Studio has integrated with Alibaba's business management platform, providing "AI Product Image" services for Taobao and Tmall merchants. This collaboration is expected to enhance Meitu's product capabilities by leveraging its traditional image strengths and gaining insights from the e-commerce sector [3]. Group 3: Investment Recommendations - The firm projects adjusted net profits for Meitu to be CNY 9.43 billion, CNY 12.34 billion, and CNY 15.93 billion for the years 2025 to 2027. Using a PE valuation approach, the average valuation level of comparable companies suggests a 45x PE for Meitu in 2026, corresponding to a market value of CNY 55.5 billion. At an exchange rate of 0.911 HKD/CNY, this translates to HKD 60.9 billion, leading to a target price of HKD 13.33 per share, with a "Buy" rating maintained [4].

Core Viewpoint - Oriental Securities expresses optimism about Meitu's (01357) growth prospects, highlighting the company's continuous iteration of AI features and creative applications, which enhance its global aesthetic influence and productivity expansion. The target price is set at HKD 13.33, maintaining a "Buy" rating [1][3]. Group 1: Lifestyle Scene - Meitu's AI features have seen significant updates, with 51 new functionalities introduced by October 2025, nearing the 55 new features launched in 2024. AI functionalities account for approximately 96% of these updates, up from 78% in 2024 [1]. - The company has effectively captured global trends and localized operations, leading to increased visibility. Notably, the "AI Group Photo" feature topped the iOS download charts in 14 European countries, while the "AI Snow Scene" feature led the app store rankings in 29 countries, including Germany and Turkey [1]. Group 2: Productivity Scene - Meitu's design studio has partnered with Alibaba, integrating with the Alibaba Business Manager's QianNiu backend. The "AI Product Image" feature provides AI visual generation services for Taobao and Tmall merchants, leveraging Meitu's traditional image capabilities to gain insights into the e-commerce sector [2]. Group 3: Investment Recommendations - The company is projected to achieve adjusted net profits of CNY 9.43 billion, CNY 12.34 billion, and CNY 15.93 billion for the years 2025 to 2027. A PE valuation approach is applied, with a target valuation of CNY 555 billion for 2026, translating to HKD 609 billion at an exchange rate of 0.911 HKD/CNY, leading to a target price of HKD 13.33 per share and a "Buy" rating [3].

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of HKD 13.33 per share, based on a 45x PE valuation for 2026, corresponding to a market capitalization of RMB 555 billion [3][5]. Core Insights - The company is expected to benefit from the rapid iteration of AI features and creative functionalities, enhancing its global influence and brand effect, particularly in lifestyle applications [8]. - The company has introduced 51 new features in its flagship app, with 96% of these being AI-related, indicating a strong focus on innovation and user engagement [8]. - The collaboration with Alibaba is anticipated to enhance the company's product capabilities in the e-commerce sector, leveraging its image processing strengths [8]. Financial Projections - Adjusted net profit forecasts for the company from 2025 to 2027 are RMB 610 million, RMB 936 million, and RMB 1.314 billion, respectively, with significant growth rates [3]. - Revenue projections for the same period are RMB 3.902 billion, RMB 4.859 billion, and RMB 5.995 billion, reflecting a compound annual growth rate [3][11]. - The gross margin is expected to improve from 61.4% in 2023 to 75.8% in 2027, indicating enhanced operational efficiency [11]. Market Performance - The company's stock price as of November 14, 2025, was HKD 8.38, with a 52-week high of HKD 12.5 and a low of HKD 2.6, suggesting volatility in market performance [5]. - The report highlights the company's relative performance against the Hang Seng Index, showing a significant increase of 181.26% over the past year [6].

Investment Rating - The report maintains a "Buy" rating for the company [6] Core Insights - The company is expected to leverage AI technology to enhance product payment rates, driving significant revenue growth [1] - The company's revenue for the first half of 2025 reached 1.821 billion RMB, a year-on-year increase of 12.34% and a quarter-on-quarter increase of 5.93% [1] - Adjusted net profit for the same period was 467 million RMB, reflecting a substantial year-on-year growth of 71.3% and a quarter-on-quarter growth of 56.60% [1] - Monthly active users reached 280 million, showing an 8.5% year-on-year increase, with the payment penetration rate rising to 5.5% in the first half of 2025 [2] - The company has formed a strategic partnership with Alibaba to promote new AI productivity products [3] Financial Forecast and Valuation - Revenue projections for 2025-2027 are 4.113 billion, 5.125 billion, and 6.404 billion RMB, with year-on-year growth rates of 23%, 25%, and 25% respectively [4] - Expected net profit for the same period is 843 million, 1.168 billion, and 1.579 billion RMB, with growth rates of 5%, 39%, and 35% respectively [4] - The company is valued at a target price of 11.1 HKD per share, based on a 60x PE ratio, leading to a target market capitalization of 55.1 billion HKD [4]

Group 1: Market Overview - The consumer service, retail, and media sectors in Hong Kong have shown significant performance, with the consumer service sector down by 17.34%, retail up by 94.61%, and media up by 50.98% as of October 24, 2025 [13][10][12] - The strong valuation recovery in Hong Kong stocks is attributed to a combination of global interest rate cuts, inflows of foreign and southbound capital, and the revaluation of core internet assets like Tencent and Alibaba [13][10] - The new consumption leaders in IP toys, tea drinks, and beauty sectors are showing positive fundamentals, leading to structural market trends [13][10] Group 2: IP Economy - The global licensed consumer goods market is projected to reach $307.9 billion in 2024, with a year-on-year growth of 10% [28] - Fashion apparel is identified as the category with the highest growth potential at 70%, followed by toys at 54% and food and beverages at 52% [31] - Disney, Pokémon, and Sanrio are leading in licensed retail sales, with Disney achieving $62 billion in 2024 [29][31] Group 3: Health and Wellness - The ready-to-drink beverage segment is expected to see significant penetration growth globally, with companies like Mixue Group and Guming benefiting from a positive operational cycle [4] - The return of home-cooked meals and increased health awareness are driving demand for traditional and healthy food options [4] Group 4: Beauty Sector - The cosmetics sector in China is experiencing slower growth compared to overall retail, with Douyin (TikTok) emerging as a key player in marketing and sales [4] - New ingredients and concepts are gaining traction, with a rise in oral beauty and health products [4] Group 5: Globalization Trends - The demand for spiritual entertainment in the Middle East is surging, with companies like Red Child City Technology seeing over 60% of their revenue from this region [4] - The cross-border e-commerce landscape is expanding, with companies like J&T Express capitalizing on the growth in Southeast Asia, where parcel volumes increased by 79% year-on-year [4] Group 6: Consumer Behavior Changes - The shift in consumer behavior towards more personalized and experiential consumption is evident, with a focus on self-fulfillment and value realization [4] - The education sector is adapting to changing perceptions, with new products targeting high school and college graduates to address employment challenges [4] Group 7: Entertainment and Leisure - The live music and sports sectors are expected to outperform the broader service consumption market, with companies like Ctrip and Damai Entertainment positioned to benefit [4] - The domestic concert market is maintaining high growth, with ticket sales and attendance showing significant year-on-year increases [73]

Core Points - Xiamen Meitu Network Technology Co., Ltd. has been recognized as a "2025 Artificial Intelligence Technology Innovation Enterprise" at the 2025 International Youth Innovation Conference for its technological innovations and applications in the field of artificial intelligence [2] Group 1 - In 2025, Meitu launched several AI features including AI dressing, AI flash, AI group photo, and image quality restoration, which helped its products like Meitu Xiuxiu, Beauty Camera, and Wink to consistently top overseas app stores [2] - Meitu's AI innovations also extend to productivity scenarios, with tools such as Meitu Design Studio, Kaipai, RoboNeo, WHEE, and Meitu Cloud Repair, effectively assisting related industries in reducing costs and improving efficiency [2] - The 2025 International Youth Innovation Conference serves as a significant platform for gathering global youth innovation forces and showcasing cutting-edge technological achievements, with awards aimed at recognizing outstanding enterprises that drive technological progress and have significant social impact [2]

Group 1 - The core viewpoint of the article emphasizes the transition of service consumption into a "smart era," driven by advancements in artificial intelligence (AI) and digital technologies [1][4][3] - The Ministry of Commerce and nine other departments have jointly released policies to expand digital service consumption, encouraging e-commerce platforms to innovate and integrate online and offline services [1][2] - The article highlights the application of AI in various sectors, particularly in tourism and healthcare, showcasing examples like the AI travel assistant "Xiao Qi" and smart hospital solutions [4][5] Group 2 - Digital service consumption is defined as the integration of technologies like AI, virtual reality, and augmented reality into service scenarios, enhancing experiences in sectors such as tourism and healthcare [4] - The article notes that the global digital service market is projected to reach several trillion dollars by 2025, indicating significant market potential [5] - AI is reshaping both online and offline consumer interactions, with examples of improved efficiency in e-commerce and retail environments, such as smart checkout systems [7] Group 3 - Despite the advancements, challenges remain in expanding digital service consumption, particularly concerning consumer trust and the maturity of technology [9] - Issues related to data security and privacy are highlighted as significant barriers to consumer acceptance of digital services [9] - Recommendations include enhancing policy guidance, supporting innovation, and promoting collaboration between tech companies and traditional service industries to develop new service consumption scenarios [10]

Core Insights - The rise of Nano Banana has sparked discussions about general models "consuming" vertical applications, highlighting the need for specialized tools in certain scenarios [2] - Meitu's management emphasizes that their products will continue to evolve with the development of large models, focusing on end-to-end solutions in vertical markets where general models may fall short [2] - Meitu's financial performance shows promising growth, with a revenue of 1.8 billion yuan in the first half of 2025, a year-on-year increase of 12.3%, and a net profit of 397 million yuan, up 30.8% [2] Company Performance - In the first half of 2025, Meitu achieved a global monthly active user count of 280 million, reflecting an 8.5% year-on-year growth, with nearly 100 million users from overseas, growing over 15% [2] - Despite strong performance, Meitu faces challenges from international giants like Adobe and Canva, which are expanding their market presence in design tools, necessitating continuous breakthroughs in technology and market depth for Meitu [3]

Core Insights - The article discusses the integration of artificial intelligence (AI) and digital technologies into service consumption, highlighting a shift towards a more intelligent and digitalized service landscape in various sectors such as healthcare and tourism [1][2][5] Group 1: Digital Service Consumption - Digital service consumption refers to the application of technologies like AI, virtual reality, and augmented reality in service scenarios, enhancing experiences in sectors such as tourism and healthcare [2][5] - The Chinese government has introduced policies to expand digital service consumption, encouraging e-commerce platforms to innovate and integrate online and offline services [1][2] Group 2: Healthcare Innovations - Companies like Dineike are leading the development of smart hospitals, providing a range of products and services that enhance hospital operations and patient experiences [3] - Dineike has successfully assisted over 2,000 hospitals in upgrading to smart systems, indicating a significant market opportunity in the healthcare sector [3] Group 3: AI in Consumer Services - AI technologies are transforming both online and offline consumer interactions, improving efficiency and service capabilities for businesses [4][5] - For instance, AI-driven retail systems can process transactions significantly faster than traditional methods, enhancing customer experience and reducing labor costs [4] Group 4: Market Potential - The global digital service market is projected to reach several trillion dollars by 2025, indicating vast potential for growth and investment in this sector [3] Group 5: Challenges Ahead - Despite the advancements, challenges remain in consumer trust and technology maturity, particularly concerning data security and privacy [6] - There is a need for stronger policy support and innovation funding to address these challenges and promote the development of digital service consumption [6]

Core Viewpoint - Cathay Securities has raised the EPS forecast for Meitu Inc. for 2025-2027 to 0.21, 0.30, and 0.39 CNY respectively, with a target price of 11.59 HKD, maintaining a "Buy" rating [1] Financial Performance - In the first half of 2025, Meitu's total revenue increased by 12.3% year-on-year to 1.8 billion CNY, with a gross margin of 73.6%, up by 8.7 percentage points [2] - The net profit attributable to shareholders grew by 30.8% to 397 million CNY, while the adjusted net profit increased by 71.3% to 467 million CNY [2] - The overall Monthly Active Users (MAU) reached 280 million, a year-on-year increase of 8.5%, with MAU outside mainland China growing by 15.3% to 98 million [2] Product Development and Market Position - Meitu's image and design product revenue rose by 45.2% to 1.351 billion CNY, accounting for 74.2% of total revenue [2] - The flagship products, Meitu Xiuxiu and Meiyan Camera, maintained the top positions in MAU rankings for mobile image beautification and licensed photography in China [2] - The introduction of AI features has significantly contributed to the company's success, with Meitu Xiuxiu achieving top rankings in multiple countries' App Stores [3] Innovation and AI Integration - The company launched various AI-driven features, such as "AI Flashlight" and "AI Dressing," which have gained significant traction in international markets [3] - The productivity tool, Meitu Design Studio, focuses on AI workflows for e-commerce design, while the video production tool, Kaipai Video, emphasizes AI-driven video creation [3] - In the first half of 2025, MAU for productivity tools outside mainland China saw over 90% year-on-year growth [3]