Citic Securities: Upgrade Pinduoduo's Target Price to HK$83, Maintaining "Outperform" Rating

Citic Securities published a research report, upgrading Pinduoduo's (01024) target price by 23.9%, from HK$67 to HK$83, maintaining the "Outperform" rating.

Citic Securities expects that Pinduoduo will achieve steady growth in the second quarter of 2025, with online marketing revenue and adjusted EBITDA growing by 12% and 15%, respectively, reaching RMB197 billion/RMB50 billion (same below), mainly driven by the stable growth of gross merchandise value (GMV) and the continuous improvement of its global AI influence. The expansion of its warehousing e-commerce business and the positive impact of upgrading old to new inventory will also contribute to a 13.5% year-over-year increase in GMV.

The firm notes that the growth rate of income from its AI-powered offering, LingAI, has exceeded expectations, with a forecasted revenue of RMB3 billion in the second quarter of 2025. LingAI provides high-quality AI video content at competitive prices to attract global professional users, making it a new growth driver. Given the launch of LingAI and the slowing down of e-commerce growth, the firm is upgrading its target price.