2025-09-11 12:11Summary of Meituan's Conference Call Company Overview - Company: Meituan (3690.HK) - Event: Asia Leaders Conference 2025 - Date: September 5, 2025 - Focus: Food delivery competitive landscape, Instashopping growth, AI strategies, and financial outlook Key Points Industry and Competitive Landscape - Food Delivery Competition: Increased competition since June-July has significantly impacted unit economics due to elevated subsidy levels and higher delivery costs [5][7] - Market Share: Meituan aims to maintain its GTV market share leadership in the meal category, focusing on core users and extensive merchant coverage [5][7] - Order Volume Growth: Forecasted order volume growth of 13% for 3Q25 and 11% for FY25E, driven by industry-wide subsidies [5][7] Financial Performance and Projections - EBIT Loss: Expected food delivery EBIT loss of -Rmb22 billion for 2025E due to user subsidies [5][7] - Instashopping Growth: Anticipated order volume growth of 31% for 2025E, with an EBIT loss of -Rmb1.7 billion due to investments [6][7] - Revenue Growth: Projected IHT revenue growth of 13% year-over-year for 3Q25, with a 15% growth estimate for 2025E [8][7] Strategic Initiatives - Instashopping and Xiaoxiang Supermarket: Long-term GTV targets reiterated for both models by 2030E [5][7] - AI and New Initiatives: Focus on AI applications and expansion of Keeta, with expected losses from new initiatives of -Rmb2.3 billion for 3Q25E [8][7] Risks and Challenges - Downside Risks: Potential risks include intensified competition, labor cost inflation, food safety concerns, and larger-than-expected investments in Keeta [8][7] - In-store Competition: Stable competitive landscape, but impacted by macro factors and food delivery competition affecting margins [8][7] Market Outlook - Long-term Confidence: Despite near-term profit pressures, confidence remains in Meituan's local services leadership and recovery in profitability by 2026-27E [7][8] - Price Target: Buy-rated with a 12-month price target of HK$144, representing an upside of 39.8% from the current price of HK$103 [11][7] Financial Metrics - Market Capitalization: HK$642.5 billion / $82.4 billion [11][7] - Revenue Projections: Expected revenue of Rmb 337.6 billion for 2024, growing to Rmb 438.9 billion by 2027 [11][7] - EBITDA and EPS: Projected EBITDA of Rmb 49.1 billion for 2024, with EPS expected to be Rmb 7.03 in 2024 [11][7] Conclusion Meituan is navigating a challenging competitive landscape in food delivery while focusing on growth in Instashopping and leveraging AI strategies. The company remains optimistic about its long-term market position and profitability recovery, despite facing significant near-term challenges and risks.