国泰君安:乐享集团(06988)借算法技术开辟海外电商业务 首予“买入”评级

Guotai Junan: happy Group (06988) uses algorithmic technology to open up overseas e-commerce business and gives it its first "buy" rating.

Zhitong Finance ·  Sep 21, 2022 08:38  · Ratings

Guotai Junan Securities issued a research report on September 20, using the segment plus total valuation method to value LetterGroup (06988), covering the company for the first time, giving a "buy" rating, with a target price of HK $2.73. The report estimates the company's reasonable market capitalization at HK $6.469 billion and forecasts net profits of HK $127 million, HK $150 million and HK $225 million for 2022-2024, up-48.0, 18.0 and 50.1 per cent, respectively, from a year earlier.

The report analyzes that with the development of Douyin e-commerce ecology, the matching of subdivided products and long-tail user traffic has formed a huge potential value. However, due to the high dispersion of traffic, special algorithm techniques and rich data precipitation are needed to make effective use of the long-tailed user traffic in e-commerce subdivision scenarios.

As one of the earliest technology companies in China to carry out performance marketing services on Wechat and Douyin platforms, Lele Group has advanced algorithmic technology, industry experience and data precipitation, so that it can accurately match subdivided products and medium-and long-tail user traffic. and mainly based on the results of the billing model to charge commission.

The report expects that the overseas e-commerce business and unique algorithmic technology of Lexing Group will exceed market expectations. The competitive advantage of Lexing Group mainly comes from its core algorithmic technology and its own strong algorithmic ability, which has contributed to a long-term cooperation with the big platform. Before the company entered the Douyin platform, Lele Group's main business was the marketing of mutual entertainment products, and it was one of the earliest performance-based marketing service providers active in the Wechat official account platform. In the later stage, with the development of Douyin e-commerce industry, the company began to lay out the marketing business of short video e-commerce in 2019, and achieved remarkable results in two years. Therefore, the report believes that the business innovation ability and strong algorithm ability accumulation of Le Hang Group is the core value of the company.

Guotai Junan covered Le Hang Group for the first time, giving it a target price of HK $2.73 and a "buy" rating. Guotai Junan's analysis believes that the future growth points of Le Hang Group will mainly focus on three aspects: 1) the company will continue to cultivate medium-and long-tail products in short-video e-commerce, which is expected to maintain rapid growth; 2) the layout of overseas e-commerce has begun to achieve remarkable results; 3) with the maturity of overseas e-commerce, gross profit margin will rise steadily after 2023.

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