PDD ‘s tumble of nearly 30% last week on disappointing quarterly results is a reminder that China’s consumer has largely moved on from its years of double-digit growth. The slowdown shows few signs of turning around soon. That doesn’t mean it’s a sell across the board. PDD’s revenue grew by nearly 90% from a year ago, while profit more than doubled, pointed out Charlie Chen, managing director, head of Asia research, at China Renaissance Securities. “The reaction of its stock price is out of touch with its fundamentals,” he said in Mandarin, translated by CNBC. “The entire Chinese consumer market is weak, yes, [but] PDD management’s very peculiar comments caused the share price decline,” he said. Chen Lei, chairman and co-CEO of PDD, warned multiple times on the earnings call about future declines in profit. But analysts point out that despite price target cuts, the stock remains attractively valued . Other earnings have painted a less-dire picture. Chinese food delivery company Meituan on Wednesday reported second-quarter revenue and earnings that significantly beat FactSet expectations. Revenue grew by 21%, while adjusted earnings nearly doubled from a year ago. Morgan Stanley upgraded the Hong Kong-listed stock to overweight from equal-weight, while JPMorgan raised its price target to 140 Hong Kong dollars ($17.95) with an overweight rating, according to FactSet. That’s 18% upside from where Meituan shares closed Friday, up by nearly 10% for the week. The delivery company, which also owns China’s version of Yelp, said its in-store, hotel and travel business maintained “strong growth.” Management did not comment much on consumer sentiment, beyond a clear preference on value-for-money. “Under the current macro environment, demand for low-star hotels has increased,” CEO Wang Xing said on an earnings call, according to a FactSet transcript. Chinese booking site Trip.com , listed in the U.S. and Hong Kong, on Aug. 26 reported a mild beat on the top and bottom line, according to FactSet. Trip.com said reservations for travel out of China recovered to 100% of the pre-Covid level in the second quarter of 2019. That’s despite international flight capacity that’s only 75% of pre-pandemic levels, the company said. Trip.com’s Hong Kong-traded shares rose by nearly 12% last week. “I think people also now are switching a little bit more into experience consumption than goods consumption, because goods, you can only have that much,” said Liqian Ren, leader of…
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