BOCOMI highlighted in a report that PDD (PDD.US) 's 1Q24 revenue surged 131% YoY to RMB86.8 billion, beating market expectations by 13%, while adjusted net profit rocketed 202% YoY to RMB30.6 billion, significantly exceeding market expectations by 97%.
The broker estimated that TEMU's gross merchandise revenue (GMV) has reached US$10 billion and expected TEMU's loss ratio to narrow to 9%. The broker is optimistic that PDD's monetisation capacity will continue to improve as the company's China main site continues to expand its market share. Competition will intensify but PDD remains in the lead for popularity over price-sensitive customers, and the platform will attract merchants to continue to invest in advertising, so as to achieve higher growth.
For the full year, BOCOMI expected GMV and revenue on PDD's China main site to grow 22% and 33% respectively. TEMU's GMV is expected to soar over 200% to US$50 billion, with the loss margin narrowing to 8%. The broker lifted its full-year revenue and profit forecasts on PDD by 7% and 24% respectively, with revenue and profit currently expected to spike 91% and 100% respectively.
BOCOMI elevated PDD's target price to US$213 from US$180 and maintained its Buy rating.
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