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<Research>CCBI Trims MEITUAN-W's TP to HKD157.4; Defensive Measures to Pressure Food Delivery Biz in ST
According to a CCBI report, MEITUAN-W (03690.HK) delivered better-than-expected results for 1Q25. Since new entrant JD-SW (09618.HK) sparked a price war in April, investors have be...
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<Research>CCBI Trims MEITUAN-W's TP to HKD157.4; Defensive Measures to Pressure Food Delivery Biz in ST
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According to a CCBI report, MEITUAN-W (03690.HK)  +6.500 (+4.947%)    Short selling $1.22B; Ratio 20.856%   delivered better-than-expected results for 1Q25. Since new entrant JD-SW (09618.HK)  +1.200 (+0.949%)    Short selling $88.72M; Ratio 10.626%   sparked a price war in April, investors have been closely watching MEITUAN-W's food delivery strategy.

During the earnings call, management pledged to take all necessary measures to defend its market share. It also warned that core local commerce revenue growth may slow in 2Q25, with operating profit set to decline significantly.

Related NewsCLSA Slashes MEITUAN-W's TP to HKD185; Delivery Competition & Global Expansion Heap Pressure on Profit Margins
Given the intensifying competition and MEITUAN-W's determination to defend its market share, CCBI estimated that heavy subsidies and heightened sales and marketing spending will heap pressure on food delivery revenue and unit economics in the short term, although a prolonged price war is unlikely to be sustainable.

CCBI cut its target price for MEITUAN-W from HKD199 to HKD157.4. The broker also kept the Outperform rating unchanged despite the impact of fiercer competition on short-term share price performance.
(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2025-05-29 12:25.)

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