Advertisements

Earnings First Take: 3Q21 revenue largely in line with market expectations

• Revenue in 3QFY21 increased by 38% y-o-y to Rmb48.8bn, in line with consensus. 
• Adjusted net loss was Rmb5,527m in 3Q21, largely in line with market expectations
• Operating margin of food delivery segments decreased slightly, while new initiatives segment operating loss is smaller than market expectation
• Maintain BUY with TP of HK$338 under review

Advertisements

What’s New

– Meituan announced its 3Q21 results last Fridy after market close.
– Revenue increased by 38% to Rmb48.8bn, in line with consensus.
– Adjusted net loss was Rmb5,527m, largely in line with market expectations of c.Rmb5.2bn loss.
– Segment-wise, food delivery revenue increased by 28% y-o-y to Rmb26,485m, driven by 30% increase of gross transaction volume. In-store, hotel and travel segment revenue increased by 33% to Rmb8,621m; New initiatives revenue increased by 67% to Rmb13,723m.
-Transacting users increased by 40.7% to 667.5m, reaching record high. Daily average number of food delivery transactions increased by 24.9% to 43.6m.

Advertisements

Our View:

– Overall results were in line with market expectations.

– Operating loss of new initiatives segment (including Meituan Select) was well managed and better than market expectations at around Rmb11.2bn loss.

– Operating margin of food delivery decreased slightly to 3.3% from 3Q20’s 3.7%, due to increased welfare expenses for riders. 

– We currently rate BUY with TP of HK$338 under review.