"Da Xing" Dahua Ji Xian: the introduction of mainland policies will promote consumer consumption and drive the valuation repair of the internet industry. The top priority is Tencent (00700.HK), Ctrip (09961.HK), and Meituan (03690.HK).

AASTOCKS · 14:12

Dahua Jixian released a report stating that considering the stronger-than-expected implementation of mainland government policies, the bank believes that improved consumer sentiment will benefit e-commerce, local lifestyle services, and online travel agency (OTA) companies. Looking ahead to the second half of the year, the bank expects the undervaluation of internet companies to be restored through shareholder returns, cross-border expansion, and competition easing. They also believe that the development of generative artificial intelligence (AIGC) and upgrades in advertising technology will drive monetization trends.

In terms of e-commerce, the bank points out that compared to Amazon (AMZN.US) with a market cap of 2 trillion USD, the combined market cap of the four major Chinese e-commerce companies - Alibaba-W (09988.HK), JD.com-SW (09618.HK), PDD Holdings (PDD.US), and Kuaishou (01024.HK) - is only 566 billion USD, indicating a significant undervaluation. The upcoming Singles’ Day shopping festival may become a key moment to boost consumption. Additionally, benefiting from government policies such as the old-for-new program and consumer vouchers, it is believed that this will stimulate consumer sentiment. The bank expects that Alibaba and JD.com will regain momentum in total commodity trade volume (GMV) in the second half of the year through increased investment and commission rates.

The bank's top picks in the internet industry are Tencent (00700.HK), Tongchengtravel (09961.HK), and Meituan (03690.HK) in order of preference.

Stock | Investment Rating | Target Price (HKD)

Alibaba (09988.HK) | Buy | 130 yuan

JD.com Group (09618.HK) | Buy | 190 yuan

Tencent Holdings (00700.HK) | Buy | 570 yuan

NetEase (09999.HK) | Buy | 180 yuan

Baidu Group (09888.HK) | Hold | 99 yuan

Meituan (03690.HK) | Buy | 235 yuan

Kuaishou (01024.HK) | Buy | 70 yuan

Ke Holdings (02423.HK) | Buy | 67 yuan

Trip.com Group (09961.HK) | Buy | 630 yuan

Tongcheng Travel (00780.HK) | Hold | 18 yuan

Kingsoft (03888.HK) | Buy | 38 yuan

Weimob Inc (02013.HK) | Sell | 1.3 yuan

The translation is provided by third-party software.

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《大行》大華繼顯：內地政策推出將促進消費並推動互聯網行業估值修復 首選優先次序為騰訊(00700.HK)攜程(09961.HK)美團(03690.HK)

"Da Xing" Dahua Ji Xian: the introduction of mainland policies will promote consumer consumption and drive the valuation repair of the internet industry. The top priority is Tencent (00700.HK), Ctrip (09961.HK), and Meituan (03690.HK).

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《大行》大華繼顯：內地政策推出將促進消費並推動互聯網行業估值修復首選優先次序為騰訊(00700.HK)攜程(09961.HK)美團(03690.HK)