20230830-招银国际-Consumer_wallet_share_gain_strategy_boosted_revenue_and_earnings_growth_5页_991kb

PDD Holdings (PDD US) 2Q23 Analysis Summary

Financial Highlights:

• 2Q23 Revenue: RMB52.3bn, +66.3% YoY, exceeding Bloomberg consensus estimates by 22/21 percentage points, primarily driven by robust GMV growth and higher average selling prices.
• 2Q23 Non-GAAP Net Income: RMB15.3bn, +42% YoY, beating consensus by 41%, attributed to operating leverage and disciplined spending.
• Key Revenue Components:
  • Online Marketing Services: YoY growth of 50.4% to RMB37.9bn (73% of total revenue), strong beat due to higher GMV and ASP.
  • Transaction Services: YoY growth of 130.8% to RMB14.3bn, driven by Duoduo Grocery business expansion.
• Margin Improvements: Non-GAAP Gross Margin declined to 64.3%, while Operating Margin improved to 27.9%, better than estimates at 26.6%.

Growth Strategy and Outlook:

• PDD targets consumers wallet share gain, with proactive strategies to boost GMV and monetization rate, supported by better ROI compared to peers.
• Plans to strengthen domestic and international infrastructure and supply chain capabilities for sustainable merchant operations.
• Maintain BUY rating with target price US$109.00, projecting a 36.4% upside from current US$79.91 price.

Financial Ratios and Metrics:

• ROE: 27.5% for 2023E.
• P/E Ratio: 18.8x for 2023E.
• Revenue Growth Projection: Steady increase from 34.3% in 2023E to 15.9% in 2025E.

Risk and Disclosure:

• The research maintains CMB International Global Markets BUY rating, subject to market risks and uncertainties in the e-commerce sector.