Orient Securities released a research report, stating that during the new season of KuaiShou (01024) 818, the platform coordinated efforts across multiple domains to drive an increase in e-commerce GMV year-on-year. The overall GMV of the mass merchandise shelf grew by 45%, the e-commerce influencer business increased by over 24%, the GMV of mid-waist merchants increased by 27%, and the number of active merchants grew by nearly 30%. In September, the company held the 2024 KuaiShou November 11 Merchants Conference, offering 20 billion yuan in traffic subsidies, 2 billion yuan in user red packets, and 1 billion yuan in product subsidies for this year's November 11 event. It will provide targeted support for four groups: top merchants, mid-waist merchants, small and medium-sized merchants, and shelf merchants. In the third quarter of 2024, the bank expects e-commerce GMV to increase by 15% year-on-year to 333.8 billion yuan, with commission income expected to grow by 15.7%.

The bank further mentioned that the company continues to optimize its revenue structure and improve overall operational efficiency through precise cost control. The gross margin for the third quarter of 2024 is expected to reach 53.8%, maintaining a high level above 50%. Incremental subsidies for e-commerce, commercialization, and local businesses in the third quarter of 2024 may increase. Sales expenses are expected to rise in absolute terms (approximately 10.4 billion yuan), with a slight increase in the sales expense ratio. In terms of overseas operations, the company continues to focus on key regional strategies, actively exploring localized business opportunities, and is expected to maintain a trend of narrowing losses. Overall, the company is expected to achieve an adjusted net income of around 3.9 billion in the third quarter of 2024 (profit margin around 12.5%).

The bank maintains its previous forecast, projecting an adjusted net income attributable to the mother of the company for the years 2024 to 2026 to be 17.005/23.602/30.127 billion yuan. Using PE valuation and considering comparable company valuations and recent market fluctuations, the bank maintains its previous 14xPE valuation for the company in 2024. With the company's adjusted net income of 17.005 billion yuan in 2024, the corresponding fair value is 238.1 billion CNY, equivalent to 261 billion HKD (with an exchange rate of 0.912 HKD to CNY), and a target price of 60.47 HKD per share, maintaining a "buy" rating.