Introduction to this report:
The company's performance is in line with expectations. Under current supervision, higher requirements are placed on the company's business. As a leading company in the industry, the company will continue to provide greater value to society.
Summary:
Investment advice: The company's performance is in line with expectations. Considering the continuing negative impact of the epidemic, we lowered Meituan-W's 2021-2023 revenue to 1786 (-12), 2484 (-34), and 345.1 billion yuan respectively. The net profit of the mother was -250 (-105), -159 (-123), and 151 (-93) billion yuan respectively. Considering the company's long-term competitiveness, Meituan-W maintained a target price of HK$383.73 and maintained its holdings growth rating.
Overall financial situation: 2021Q3 revenue of 48.8 billion yuan/ +38%; total gross profit of 10.8 billion yuan/ -0.4%, gross profit margin of 22.1% /-8.5pct, loss of 9.99 billion yuan, adjusted loss of 5.527 billion yuan. The loss was mainly due to increased investment in Meituan Preferred. As of 2021/Q3, the number of trading users was 668 million/ +40.1%, and the number of active merchants was 8.3 million/ +27.7%. The average number of transactions per trading user per year is 34.4 /+28.4%.
① Food and beverage takeaway business: 2021Q3's revenue was 26.49 billion yuan/ +28%, operating profit was 876 million yuan, the average number of daily transactions in Q3 was 43.62 million/ +25%; the customer unit price was 49.1 yuan/+1.7 yuan, with a monetization rate of 13.4% /-0.2pct. ② In-store, hotel and travel business: 2021Q3's revenue was 8.6 billion yuan/ +33%, and operating profit was 3.78 billion yuan/ +35.8%. The operating profit margin was 43.9% /+0.9 pct, higher than market expectations. The number of nights in 2021Q3 domestic hotels was 120 million/ +5.2%. ③ New business:
2021Q3's revenue was 13.72 billion yuan/ +66.7%; operating profit was -10.9 billion yuan. Losses continued to increase compared to Q2. Mainly due to the rapid expansion of Meituan's Preferred business, it continued to invest heavily to improve product supply, supply chain and compliance capabilities. Due to the government's current strong supervision of community group buying, low price dumping is prohibited, while Meituan Preferred, as the industry leader, has obvious advantages on the supply chain and distribution side. As the market becomes more regulated, it is expected that future losses will be controlled at a reasonable level.
As a leading company in the local lifestyle service industry, the company provides greater value to consumers, merchants, takeaway riders, business partners and society as a whole. The company will continue to comply with regulations, create value for all participants in the ecosystem, and fulfill its social responsibilities.
Risk warning: The overall growth rate of the takeaway industry is lower than expected; competition in the local lifestyle service industry intensifies; labor costs continue to rise; continued losses in new businesses, etc.